Fortescue Metals Group Limited (ASX: FMG) signed a green hydrogen energy deal with AGL Energy Ltd (ASX: AGL) this week.
Fortescue is not just an iron miner any more. It has a green hydrogen and renewable energy business called Fortescue Future Industries (FFI).
Green hydrogen plan
Fortescue Future Industries and AGL have agreed to do a feasibility study to repurpose infrastructure at the Hunter Valley’s Liddell and Bayswater coal-fired power stations to generate green hydrogen from water, using renewable energy.
FFI says that the Liddell and Bayswater power stations currently account for over 40 per cent of New South Wales’ carbon dioxide emissions, according to 2019 National Greenhouse and Energy Reporting data.
NSW currently has a goal of halving its emissions by 2030. Being able to repurpose these sites will help prove how important green hydrogen is for decarbonising and demethaning energy and industry in Australia.
The Hunter Valley Industrial Clean Energy Hub is expected to create thousands of jobs, whilst also creating a regional domestic and export industry.
Initial renewable electricity production through new wind and solar could be 250MW, generating 30,000 tonnes of green hydrogen per year.
Eventually, due to the scalability of electrolysers, FFI estimates suggest production will be in the gigawatts. Power for the electrolyser will come from new wind, solar, and supported by new pumped hydro and batteries, generated by Fortescue Future Industries, AGL and other parties.
The feasibility study will also look at whether green hydrogen can be used to fuel co-located industries, in addition to export options.
Management comments
FFI Founder and Chair, Dr Andrew Forrest said:
“FFI’s goal is to turn regional Australia into the global green energy heartland and create thousands of jobs now and so many more in the future.
“Repurposing existing fossil fuel infrastructure with forward looking companies like AGL to create green hydrogen to help power the world, is the solution we have been looking for.
“Green hydrogen is the only true zero-carbon, zero-methane fuel – every other type of hydrogen requires the burning of fossil fuels.
“It is a practical, implementable solution that can collapse emissions and create strong economies worldwide if leaders like [AGL CEO] Graeme are fully supported by global investors and local government alike.”
