Plans to build a large-scale hydrogen electrolyser and power plant near Whyalla in South Australia’s north are in tatters after the state government announced the standalone body that had been in charge of delivering the $593 million ($381.65 million) project has been dissolved.
In a statement to parliament, state Energy Minister Tom Koutsantonis said the Office of Hydrogen Power South Australia would “cease to function” and that its responsibilities would be transferred to the Department for Energy and Mining.
The office was established in 2022 to coordinate the state’s green hydrogen initiatives with the Whyalla project, being funded by the SA government under its Hydrogen Jobs Plan program, chief among its priorities.
The project, that was to comprise 250 MW of electrolysers and a 200 MW green hydrogen-fired power plant to help power GFG Alliance’s Whyalla steelworks, was shelved earlier this year following the financial collapse of the steelworks.
The state government opted to redirect the $593 million funding package set aside for the green hydrogen project to support the steelworks.
Koutsantonis told parliament the green hydrogen power plant has been “deferred” but the project was last month officially withdrawn from the Australian Energy Market Operator’s pipeline of projects.
Despite the shelving of the hydrogen plant and the disbanding of the Office of Hydrogen Power, Koutsantonis said the long-term need for a hydrogen production facility had not changed.
“Ultimately, one day you will need to have a hydrogen facility to decarbonise steel,” he said.
“That’ll depend entirely on who purchases the steelworks, what their time frames are for investment in direct iron reduction and electric arc furnace.”
It is understood the Port Bonython Hydrogen Hub, being developed by the state government with support from the federal government, will still be pursued.
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