08/05/2021

(AU ABC) Green Hydrogen Electrolysers To Be Built In Regional Australia With Government Backing

ABC Rural - Eliza Borello | Laura Birch

Power company Engie will receive $42.5m Federal funding to produce hydrogen in Yara Pilbara fertiliser's ammonia facility. (Supplied: Engie)
Key Points
  • $100m ARENA funding will go to Engie Renewables in the Pilbara, ATCO in WA's Mid West and AGIG's Hydrogen park in Wodonga, Victoria.
  • The three projects will produce green hydrogen, using renewable energy
  • Federal Minister Angus Taylor says the hydrogen produced by ATCO and AGIG will be blended with LNG for use in gas networks
Three new green hydrogen plants have been approved in regional Australia and will share in more than $100 million worth of conditional Federal Government funding.

The Australian Renewable Energy Agency (ARENA) has awarded Engie Renewables up to $42.5 million towards a 10 megawatt (MW) electrolyser project which would produce hydrogen in Yara Pilbara Fertiliser's existing ammonia facility in Karratha in Western Australia.

Further south, at Warradarge in WA's Mid West, ATCO has won up to $28.7 million towards a 10 MW electrolyser for gas blending at its Clean Energy Innovation Park.

Australian Gas Networks Limited (AGIG) was set to receive up to $32.1 million towards a 10 MW electrolyser for gas blending at AGIG's Murray Valley Hydrogen Park in Wodonga, Victoria.

While all of the electrolysers would produce green hydrogen, the type preferred by environmentalists, Energy Minister Angus Taylor said the ATCO and AGIG produced hydrogen would eventually be blended with non-renewable liquefied natural gas.
Energy and Emissions Reduction Minister Angus Taylor. (ABC News: Jess Davis)
"This is about blending hydrogen into our gas network, so the purpose of this is to actually bring the carbon emissions of our gas network down," he said.
"The key here is for us to build the infrastructure and to get the R & D [Research and Development] done so we can get the costs down, we can provide the supporting infrastructure and then the private sector can invest on the back of that."

The Government said the projects were expected to create more than 210 jobs during construction.

The project proponents must satisfy a number of conditions, including achieving financial close, before Commonwealth funding is provided.

A comparison of production process for the "blue" and "green" types of hydrogen. (Supplied: Woodside) 

Good energy policy needs to match investment Australian Hydrogen Council chief executive Fiona Simon welcomed the funding and said building some of the biggest electrolysers in the world would put Australia on the global hydrogen map.

"This type of investment is the boost that the industry needs to progress commercial, large-scale projects," Dr Simon said. 
"This investment should be matched with good policy to encourage demand and improve the economics of producing hydrogen, which will ultimately increase supply of hydrogen."
 While the funding has been approved, ATCO said it would wait until December 2022 before making a final investment decision on its Warradarge project.
AGIG's general manager Craig de Lane said his company planned to reach a financial close for its Wodonga project and start construction by early 2022.

A Yara Pilbara Fertiliser spokesman said he expected a final investment decision to be made within months, construction starting by the end of 2021 and the plant to be operational by 2023.


Green hydrogen is billed as the new climate friendly fuel in town but will it work?

Potentially bigger than LNG The news of Engie's successful bid for an electrolyser in the Pilbara was welcomed by the Karratha and District Chamber of Commerce and Industry President, Tony Simpson, who said he believed hydrogen had the potential to be bigger than LNG.

"One of the key issues for around Karratha and the Pilbara in general is [having] another industry."

"We're known for iron, we're known for mining nickel, gold, and LNG and now we're going into hydrogen which is another whole project and another economy in itself," he said.

"The spinoff back to the town will be huge in terms of job opportunities and what we're trying to do in Karratha is make it a liveable city."

Woodside and BHP miss out Gas giant Woodside missed out on its bid for funding for its proposed H2TAS hydrogen project at Bell Bay in Tasmania.

BHP's funding application for a 10 MW green hydrogen electrolyser at its Kwinana Nickel Refinery was also unsuccessful.

A Woodside spokeswoman congratulated the successful proponents and said the company remained committed to H2TAS.

"We have had a longstanding target of final investment decision for H2TAS Phase 1 in the second half of 2021," she said.

"Today's announcement from ARENA does not mean the end of the H2TAS opportunity, and we will now undertake further review of the concept and schedule."

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