Opposition Leader Vincent Tarzia challenges Premier Peter Malinauskas over $593m Whyalla hydrogen plant

Plans for a government-owned, $593m hydrogen power plant are being questioned after major energy firms abandoned the technology.

Premier Peter Malinauskas is being challenged over whether hundreds of millions of taxpayer dollars will be squandered on “a hydrogen vanity project” at Whyalla after major energy firms abandoned the technology.

Speaking during a visit to Whyalla on Friday, Opposition Leader Vincent Tarzia said respected industry leaders like Origin Energy and Andrew “Twiggy” Forrest’s Fortescue were exiting hydrogen due to cost and complexity.

He accused Labor of gambling $593m on a government-owned and operated hydrogen power plant on Whyalla’s outskirts, without lowering electricity bills.

The world's biggest hydrogen production facility, power plant and storage planned for Whyalla. Supplied.

But Energy and Mining Minister Tom Koutsantonis carpeted a “pathetic stunt from a pathetic Opposition” taking its “whingeing roadshow to Whyalla”.

Billed as a “world-leading hydrogen power station”, the project is touted as priming South Australia to “become a first-mover, low-cost hydrogen supplier” and start operations by early 2026.

Asked whether the Liberals would abandon the project if elected, Mr Tarzia urged full transparency over the project’s costings, which have remained fixed since first announced in early 2021.

“We want to see the updated costings, the updated modelling. What does Peter Malinauskas think that he knows better than Twiggy and Origin?” he said.

“We know that these are respected industry leaders that are exiting hydrogen due to the cost, but also the complexity.

“We’ve got real concerns about the hundreds of millions of dollars of taxpayer funds that are going to be spent on what effectively might become a hydrogen vanity project. We don’t want this to be a white elephant.”

Opposition energy and net zero spokesman Stephen Patterson, Opposition Leader Vincent Tarzia and GFG Alliance managing director Tony Swiericzuk in Whyalla on Friday. Picture: Supplied

Origin Energy on Thursday declared it was abandoning ambitious plans to develop hydrogen, scuttling a proposed $207m Hunter Valley Hydrogen Hub project because of uncertainty around the “pace and timing of development of the hydrogen market” and the risks associated with developing capital-intensive projects of this nature.

It came after billionaire Andrew Forrest earlier this year scaled back his own green hydrogen targets at his firm, Fortescue.

Mr Koutsantonis cited an independent report by the Australian Energy Market Operator, which he argued showed the hydrogen power plant would be “a critical part of the future energy supply mix in South Australia”.

“While we’ve seen Fortescue has cancelled some of its projects, it is still going ahead with its hydrogen plans in South Australia. Rather than an indictment on hydrogen, that is testament to the competitive advantage we have for hydrogen development in SA,” he said.