The WA large-scale green hydrogen production dream has been given new life with a Danish investment firm securing $814 million in backing from the Commonwealth government.
Energy and Climate Change Minister Chris Bowen was in Kwinana on Thursday to announce the Murchison Green Hydrogen project as the first successful bidder in the $2 billion hydrogen headstart fund established in 2023.
Chris Bowen, Roger Cook and Madeleine King announced four big batteries for WA that can together power 600,000 households.
The project, based 20 kilometres north of Kalbarri, by Copenhagen Infrastructure Partners will receive $814 million in production incentives if it successfully builds and begins operating the facility.
Stage one is expected to produce 900,000 tonnes of green ammonia per year.
Green hydrogen is hydrogen derived from water using electricity supplied through green energy. Green ammonia is a further production of that hydrogen to turn it into a transportable state – which is why it shows promise to replace fossil fuels as an alternative source of exportable energy.
This technology is not proven at scale however with the globe only currently able to produce about 100,000 tonnes of green hydrogen annually.
The Commonwealth’s green hydrogen ambitions were dealt a blow in January with BP pausing its hydrogen headstart bid to build a $1 billion hydrogen facility in Kwinana at its old petroleum refinery.
Bowen admitted the industry would be tough to establish, but it was important to do.
“Australia is one of the few places in the world which can be home to a serious green hydrogen industry,” he said.
“There are some people who celebrate and luxuriate in the difficulties in setting up a green hydrogen industry. It is tough. The economics do need work. This is early stages. There will be setbacks and delays. But that doesn’t make it unimportant.
“It makes it more important that governments work together to make these projects a reality.”
Under the hydrogen headstart program companies can secure production credits over a decade to “bridge the gap between the cost of producing renewable hydrogen and the market price.”
CIP partner Karsten Uhd Plauborg said the company was honoured to receive the funding which reinforced their shared vision to establish a leading hydrogen industry in Australia.
The project was expected to create 3600 jobs during construction and 600 ongoing jobs and would be fed green electricity through six gigawatts of onshore wind and solar projects.
Once fully operational CIP said it would project up to 1.8 million tonnes of green hydrogen annually.
Smart Energy Council acting chief executive Wayne Smith said announcing the project in WA made sense.
“A critical ingredient needed to make Australia a renewable energy and critical mineral superpower is green hydrogen,” he said.
“This will unlock more of the country’s world-class hydrogen potential and pave the way for new, large-scale clean energy exports.”
Bowen also announced four successful tenders for big batteries in Boddington, Merredin, Muchea and Waroona that will collectively have the stored electricity to power 600,000 homes on the South West energy grid for four hours from October 2027.