Fortescue Future Industries signs hydrogen production deal in US
Andrew Forrest’s Fortescue Future Industries has entered a deal to convert an old coal-fired power plant to hydrogen production in Washington.
Fortescue Future Industries has taken another step in its plan to enter the hydrogen industry in the US, cutting a deal to study the feasibility of converting a US coal-fired power plant and mine in Washington into a hydrogen production facility.
Fortescue chairman Andrew Forrest first flagged his plan to move to repurpose US coal-fired power stations into hydrogen production facilities in April, telling The Australian he was eyeing the acquisition of as many as 22 power stations in West Virginia.
FFI said on Friday it had signed a deal to study a feasibility study at the Centralia mine and power station in Washington with the Industrial Park at TransAlta (IPAT) – a group formed to look at options for redeveloping the industrial site when the power station closes in 2025. If the feasibility studies were successful, the company said, it would look to use the facility’s existing workforce to build and run a hydrogen plant.
FFI did not release any details of the planned size of the facility, nor put an estimate on its cost.
But the company said it planned to tap the US government‘s Hydrogen Hub Program for a grant to help develop the project, which FFI says is part of a plan to turn the site into a regional hydrogen production hub.
Paul Browning, the chief executive of FFI’s US operations, said the hub could eventually act as an energy source for the region’s heavy industry. “The electric power grid of the Pacific Northwest is one of the lowest carbon power grids in the world and can be used to produce green hydrogen, and could extend the region’s low carbon leadership to hard to electrify sectors like long-haul trucking, ports, aviation, and heavy industry,” he said.
The coal-fired plant is owned by Canada’s TransAlta, and has been running since 1971. The first of its two 670 megawatt generating units closed in 2020, with the second due to close in 2025.
FFI said it is also working with local stakeholders, including the Lewis County Energy Innovation Coalition, to develop other projects in the region, including the potential rollout of hydrogen-fuelled buses and heavy trucks.
FFI’s move on Centralia mirrors its deal in late 2021 with Australian utility AGL, which could see a hydrogen production plant built on the site of AGL’s Liddell and Bayswater power stations in the Hunter Valley.
AGL is set to close its Liddell coal-fired power station in the Hunter Valley in 2023, with the nearby Bayswater plant due to close by 2035. The two companies are studying the feasibility of building a hydrogen production plant that would produce 30,000 tonnes of the fuel each year.
As with Centralia, Dr Forrest has pitched the transformation of Liddell and Bayswater – both which sit in the heart of NSW coal country – as an important way to retain high value jobs in the region when coal fired power stations are phased out of the grid.
Although the initial proposed development at Liddell is relatively small, FFI has said the initial feasibility study would also give an indication of whether production could be scaled further at Liddell, potentially establishing the site as a hydrogen production hub.
While FFI has been relatively quiet on its activities in the US, the green hydrogen arm of Dr Forrest’s iron ore company has been undergoing rapid expansion in the county after signed on Mr Browning as its chief executive in October 2021. FFI is currently advertising for a chief financial officer for its US business, with a job advertisement for the role saying the company has opened offices in Texas and in Florida.