Whyalla’s blue steel plant on track for $2bn green glow-up

A hydrogen power plant at Whyalla is ready to snare a share of $2bn in budget funds to produce green steel, among the major wins for cash splashes in SA.

A Whyalla hydrogen power plant is poised to snare a slice of $2bn in funding to help produce green steel under plans to make Australia “a renewable energy superpower”.

Declaring the nation’s biggest opportunity for growth and prosperity was the global shift to clean energy, Treasurer Jim Chalmers unveiled a Hydrogen Headstart program to fund large-scale projects.

The planned Whyalla hydrogen power plant, electrolyser and storage facility is being pitched to overseas governments and investors by Premier Peter Malinauskas during a four-day trip to Germany and the Netherlands.

Dr Chalmers said the $2bn Hydrogen Headstart program would put Australia on course for up to a gigawatt of electrolyser capacity by 2030 through two to three flagship projects.

The hydrogen program is part of a $4bn budget allocation to realise Australia’s “future as a renewable energy superpower”, which Dr Chalmers said brought the government’s total funding to more than $40bn.

Premier Peter Malinauskas and Federal Minister Ed Husic (left) talk to steelworker Matt Rogers at the Whyalla steel plant on April 4. Picture: GFG ALLIANCE/Brenton Edwards

In an apparent endorsement of state Labor’s centrepiece Whyalla project, Dr Chalmers said the Hydrogen Headstart program was designed to make Australia “a world leader in producing and exporting hydrogen power” while reducing “emissions in heavy industry here at home”.

“Hydrogen power means Wollongong, Gladstone and Whyalla can make and export everything from renewable energy to green steel,” he said in his budget speech.

“Seizing these kinds of industrial and economic opportunities will be the biggest driver and determinant of our future prosperity.

“The government is making the biggest-ever investment in Australia’s energy transformation.”

A global market call for the Whyalla power plant, which would fuel the nearby steelworks plans for green steel production, has attracted 29 proposals from across the globe. An evaluation process is underway with a view to awarding contracts in the second half of 2023.

Green hydrogen is produced using renewable energy. So-called green steel would be produced using energy from this hydrogen fuel.

Hydrogen can be combusted for industrial fuel, used as a chemical input for green manufacturing, a fuel for heavy transport or liquefied and compressed for export.

A further $38.2m in budget funding was for a Guarantee of Origin scheme, to certify, track and verify emissions from clean energy products, in particular hydrogen.

During his trade mission, Mr Malinauskas will deliver the opening keynote address at the World Hydrogen Summit, in the Dutch port city of Rotterdam, which brings together the biggest global government and industry players.

In other major wins for SA in the federal budget …

Billions to be spent on nuclear subs

Billions of dollars will be spent on preparing the country for the construction of nuclear-powered submarines in Adelaide, as latest budget papers lay bare the Australian Defence Force’s grim challenge to recruit nearly 20,000 extra people by 2040.

In attempts to address a looming skills crisis, the federal government will spend more than $127m to fund 4000 additional university places over the next four years to boost participation in STEM disciplines.

At least 800 places will be allocated to South Australian universities, while the remaining spots will be distributed through a “competitive process”, likely sparking a fierce contest between state governments.

It’s clear the battle to train future skilled workers will be fought primarily in tertiary institutions, as the budget includes just $1.1m of extra funding for the federal Education Department to develop “skills and training initiatives” for the nuclear-powered submarine program.

Defence is facing a struggle to grow its civilian and military workforce to meet complex national security challenges and to operate nuclear-powered submarines.

Treasurer Jim Chalmers MP on board USS Asheville … the federal government will spend more than $127m to fund 4000 additional university places over the next four years to boost participation in STEM disciplines.

In its portfolio budget statement, Defence revealed plans to grow its workforce by 18,500 to 101,000 by 2040, with a focus on developing intelligence, space and cyber skills to support a “significant transformation of Defence’s capabilities” through the AUKUS partnership.

A high rate of people leaving the military and “lower than expected” recruitment has ADF’s workforce projections well below the 101,000 target.

In a trial scheme next year, military personnel will be offered $50,000 to re-enlist after their mandatory service period.

A new Australian Submarine Agency, costing $4.2bn over the next decade, will be created on July 1 to oversee all aspects of the nuclear-powered submarine program. This funding will be complemented with more than $100m provided to various government agencies and departments over the next two years.

This includes $25.2m for the Australian Radiation Protection and Nuclear Safety Agency to conduct “nuclear licencing activities”, and $5.2m for the Australian Radioactive Waste Agency to develop a nuclear waste site, the location of which will be revealed later this year.

New nuclear non-proliferation and safeguard arrangements will be designed with the International Atomic Energy Agency, costing $21.9m over the next two years.

Details of a new “equity injection” for Australian Naval Infrastructure to construct a new submarine shipyard at Osborne has been kept secret due to “commercial sensitivities”. It was previously revealed, however, that about $2bn would be invested in new shipyard infrastructure over the next four years.

$60m for SA’s local roads

South Australia can expect a $60m injection from the federal government to supplement state funding to build local roads.

After already receiving $20m this financial year, SA will continue to receive $20m each financial year for the next three years.

This is part of a larger $1.8b national infrastructure investment over the next 10 years including New South Wales receiving $361.9m over eight years from 2023-24 for infrastructure projects including safety upgrades on the Bells Line of Road and Nowra Bypass planning.

Existing road maintenance and safety programs will receive $1.1b in 2032-33.

SA cancer patients get boost

South Australia has multiple grants for specific health-related projects and trials including $27.3m for the proton beam laboratory to treat inoperable cancers in the building now under construction next to SAHMRI on North Tce, and $5m over two years towards the genomics laboratory on North Tce to improve treatment of cancers.

The budget includes $8m over two years to establish an adult mental health centre in Adelaide, as well as $3.7m over five years for a SA-only trial to “assist vulnerable priority groups”.

There is $1.6m over two years to improve access to palliative care for residents in SA aged care homes as well as $7.3m over three years for a SA-only pilot to increase overall access to palliative care.

The budget also continues a five-year commitment of $140m to expand Flinders Medical Centre which will result in 136 extra beds at FMC and 24 extra beds at the Repat.

Originally published as Whyalla’s blue steel plant on track for $2bn green glow-up