SA Energy Minister Tom Koutsantonis announces turbine sell off as $593m hydrogen plan deferred

Two generators being built for the $593m hydrogen project will be sold off to the highest bidder, but the government still claims hydrogen ‘has a future’ in SA.

Two generators being built for the $593m hydrogen project will be sold off to the highest bidder as the state government’s key election promise to build a world-leading power plant falls apart.

As $593m funding earmarked for the hydrogen plan is redirected to the Whyalla Steelworks rescue plan, Energy and Mining Minister Tom Koutsantonis claimed the turbines currently being made in the United States would help claw back already spent taxpayer dollars.

The General Electric “hydrogen capable gas turbines” would be sold for their “original price or higher” under condition they were used in SA to help with local power production, he told parliament on Thursday.

Tom Koutsantonis addressing the media during a visit to the Whyalla Steelworks. Picture: NewsWire / Tim Joy

However, Mr Koutsantonis said the government remained committed to hydrogen and “it is important that we maintain the office, why? Because hydrogen has a future”.

His statement followed Premier Peter Malinauskas announcing the government’s flagship project would be “deferred” and the Office of Hydrogen Power SA scaled back, the move expected to trigger redundancies among its 55 staff.

“The work continues, it will be significantly curtailed, in light of the announcement we have made,” Mr Malinauskas said.

Just last month, Mr Malinauskas assured that ground works at the Whyalla project site continued, generators were being built, and the government remained committed to its hydrogen plan.

Federal opposition leader Peter Dutton called on the government and Prime Minister Anthony Albanese to further step away from the plan saying he was concerned prospective buyers could be turned away from buying the Whyalla Steelworks, now under administration.

“We need to make sure that the Prime Minister explains to Australians how green hydrogen is going to work because the electricity cost is much higher than what Whyalla would be paying now, when nowhere else is commercially operating in this way,” Mr Dutton said.

“So, steel is an essential part of production in this country. We need to make sure we have a strong sector, but we can’t have the Prime Minister pretending that somehow green hydrogen is going to be prospective.”

News of the state government stepping away from the hydrogen plant comes less than a month after Queensland leaders pulled funding from a $12.5bn hydrogen project in Gladstone.

Woodside Energy and Origin also shelved hydrogen plans and Andrew Forrest-led Fortescue pulled back from its projects across the country.

SA Opposition Leader Vincent Tarzia at the empty SA Hydrogen plant site in Whyalla this morning. Picture: Supplied

Opposition leader Vincent Tarzia said the heralded hydrogen power plant site in Whyalla is virtually empty despite promises of a world-leading project meant to bring down power prices.

“The government has taken its eye off the ball, you can’t have green steel when you haven’t got steel at all and we have been calling out this hydrogen hoax for a long time,” he said.

Originally published as SA Energy Minister Tom Koutsantonis announces turbine sell off as $593m hydrogen plan deferred