Anthony Albanese accused of ‘humiliating backflip’ on Kurri Kurri gas power station
In a major play for Hunter Valley voters, Anthony Albanese has announced Labor now support a new taxpayer-funded gas power station in NSW.
NSW
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Labor’s plan to accelerate the transition of a new taxpayer-funded gas power station in NSW to green hydrogen has been ridiculed as a “humiliating backflip” and economically unviable.
In a major play for Hunter Valley voters, Labor leader Anthony Albanese has announced he supports the $600 million Kurri Kurri project going ahead, having previously opposed it.
However Labor would require the 660 megawatt gas plant, which is to be built by Snowy Hydro, start with 30 per cent green hydrogen and transition to 100 per cent when feasible — expected to be by 2030.
Energy and Emissions Reduction Minister Angus Taylor criticised Labor’s cynical “backflip” and argued green hydrogen technology would not be ready in time to make the project viable.
“It’s time for Labor to come clean about who is going to pay for their policies,” he said.
According to the Coalition, having 30 per cent green hydrogen at Kurri Kurri would initially make fuel costs about five times higher.
Under the federal government’s plan, the plant was always going to convert to hydrogen once it was commercially viable, which is considered to be $2 a kilogram or less.
Currently green hydrogen costs about double and is not being produced on a commercial scale anywhere in Australia.
“We want to see hydrogen going into this generator but in a way that is economically, commercially and technically feasible,” Mr Taylor said.
“But forcing it in any way is going to cost other taxpayers for electricity consumers. It doesn’t make economic sense.”
If elected, Labor would put an extra $700 million in equity investment into Snowy Hydro to complete the project, which would then “make money” for the Commonwealth.
Mr Albanese said Labor’s plan to equip the gas plant with green hydrogen potential from the start would have “no impact” on household power prices.
“This is a practical plan. It’s one that ensures that we don’t have a stranded asset with workers losing their jobs down the track,” he said.
“It’s one that’s about actually looking at the problems that would have been created with the government’s proposal and how we make sure that it is turned into something that actually works.”
Instead he said over time the cost of producing green hydrogen would fall “substantially” and Australia would be well-placed to benefit from global demand for the fuel.
“All those solar panels on the roofs of businesses and homes are built in China … that’s the tragedy here,” he said.
“We have an opportunity here of first mover advantage in green hydrogen.”
GREEN HYDROGEN EXPLAINED
Despite green hydrogen being tipped as a “fuel of the future“ it is almost a decade away from price-competitiveness with other options.
Currently fossil fuels like coal are used to extract hydrogen from water, which emits significant amount of CO2.
The technology to make the extraction process “green” using renewable energy sources does already exist, but is much more expensive.
There is also “blue hydrogen,” which is produced from natural gas with carbon capture and storage.
Conventional hydrogen and blue hydrogen cost about $2 per kilogram, while green is about twice as much.
The cost of green hydrogen is steadily falling however, with an Australian National University report last year estimating it would be possible to currently make it at about $3.18 to $3.80 per kg, and get to $2 per kg by 2030.
One planned use for cheap hydrogen is to power turbines that could generate electricity at time of peak demand to help firm the grid.
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