Latest news with #HydrogenProductionTaxIncentive
Sky News AU
a day ago
- Business
- Sky News AU
Labor's 'dead horse' green hydrogen gamble slammed by energy expert Jude Blik as the govt urges Fortescue to repay funds
Labor's 'attempt to appear fiscally prudent' by urging Fortescue to repay handouts for a failed green hydrogen plant has come under fire, as the Albanese government continues to 'bet our future' on the fuel which has been labelled a 'dead horse'. Industry and Innovation Minister Tim Ayres has urged the energy and mining giant to reimburse the government for the millions of dollars it gave Fortescue for the defunct Gladstone plant. The Queensland operation received about $60m in federal and state government support and was canned about 12 months after it opened. The recent shift is a blow to Labor's net-zero plans, which include a Hydrogen Production Tax Incentive as part of its Future Made in Australia Act. More than $6.5 billion will go toward the scheme, which provides $2 per kilogram of renewable hydrogen produced between 2027-28 and 2039-40. Centre for Independent Studies energy analyst Jude Blik said the latest failure was 'no surprise given green hydrogen was never feasible'. 'Green hydrogen is the panacea that Australia's Net Zero hopes and dreams have been pinned on,' Mr Bilk told 'Yet it has never been economic – even for the most basic use cases in chemical manufacturing, let alone for hare-brained green energy export schemes. 'Labor's attempt to appear fiscally prudent in recovering funds is odd given they are still throwing good money after bad with billions still committed to green hydrogen projects. 'Green hydrogen is a dead horse - yet the government continues to bet our future on it.' He said that Fortescue, in principle, should return the taxpayer funds as the funds 'should be used to deliver public benefit'. However, Mr Blik acknowledged that it was not clear whether Fortescue should repay the funds without knowing the terms of the grant. A Fortescue spokeswoman said the company has been 'upfront with the government and will return funds where required under the grant agreement". Creating green hydrogen has proved extremely difficult for local industry despite massive government subsidies. Mr Blik said analysis from the CIS showed a 'realistic price' of green hydrogen was $10/kg – well above the $2/kg price for hydrogen from natural gas. 'This means that for any project to be successful it will either need to find a buyer at $10/kg, or achieve subsidies of $8/kg – both of which are completely unrealistic,' he said. 'The notion that there is a 'technology curve' that we need to be ahead of is naively optimistic, which would be forgivable if we weren't betting our nation's future on it.' The failure of the Gladstone project, alongside another US plant in Arizona, will blow a US$150m ($227m) hole in Fortescue's financial results. On the US project's failure, Fortescue chief executive of growth and energy Gus Pichot told analysts the shift away from green energy under US President Donald Trump hurt the project's viability. 'A shift in policy priorities away from green energy has changed the situation in the US,' Mr Pichot said. 'The lack of certainty and a step back in green ambition has stopped the emerging green energy markets, making it hard for previously feasible projects to proceed. 'As a result, we cannot proceed with our investments as they stand, and will explore future opportunities for our site in Arizona.'
Sky News AU
4 days ago
- Business
- Sky News AU
Labor Minister Tim Ayres calls on Fortescue to repay $60m of taxpayer funds for failed green hydrogen project in Gladstone
Labor is seeking back the tens of millions of dollars of taxpayer funds it injected into Fortescue's failed green hydrogen project after the major company flipped on the beleaguered energy source. The Andrew Forrest-owned energy and mining giant on Thursday revealed it was scrapping green hydrogen projects in Queensland's Gladstone and the United States' Arizona. The Queensland plant has received about $60m in federal and Queensland government support and was opened 12 months before Fortescue canned the operation. While the company blamed the collapse of the Arizona facility on the shift in policy from the Trump administration, the Albanese government has earmarked billions of taxpayer dollars into green hydrogen in Australia. The recent shift is a blow to Labor's net-zero plans, which include a Hydrogen Production Tax Incentive as part of its Future Made in Australia Act. More than $6.5 billion will go toward the scheme, which provides $2 per kilogram of renewable hydrogen produced between 2027-28 and 2039-40. A spokesperson for Industry and Innovation Minister Tim Ayres said the government was hoping Fortescue would return the taxpayer funds it provided to fuel green hydrogen production in Australia. Labor has called on Fortescue to repay the millions of dollars it was given for a now-failed green hydrogen project. Picture: Getty Images A spokesperson for Mr Ayres said Labor would like Fortescue to repay the public funds. Picture: NCA NewsWire / Martin Ollman 'The decision not to proceed the PEM50 Hydrogen plant in Gladstone is a commercial matter for Fortescue,' the spokesperson said. 'However, if Fortescue does not proceed with the delivery of the MMI-funded Gladstone Electrolyser facility project it would be reasonable for the government to seek reimbursement for where the grant agreement hasn't been fulfilled.' Fortescue has not committed to ruling out repaying the taxpayer funds as it continues discussions with both the Queensland and federal governments. 'We are in active discussions with both governments on the future use of the land and the assets that have been invested in. As these are confidential discussions, it would be inappropriate to disclose details,' a spokesman said. The failure of the two projects will blow a US$150m ($227m) hole in the energy and mining giant's financial results. On the US project's failure, Fortescue chief executive of growth and energy Gus Pichot told analysts the shift away from green energy under US President Donald Trump hurt the project's viability. 'A shift in policy priorities away from green energy has changed the situation in the US,' Mr Pichot said. 'The lack of certainty and a step back in green ambition has stopped the emerging green energy markets, making it hard for previously feasible projects to proceed. 'As a result, we cannot proceed with our investments as they stand, and will explore future opportunities for our site in Arizona.'
Sky News AU
20-05-2025
- Business
- Sky News AU
Former party president Michael Kroger slams Labor government's green hydrogen plan as ‘waste' of billions of taxpayer dollars
Former Victorian Liberal Party president Michael Kroger has fiercely scorned the Labor government's green hydrogen plan as a 'waste' of billions of taxpayer dollars. A Hydrogen Production Tax Incentive is included in Labor's net-zero plans as part of its Future Made in Australia Act, and more than $6.5 billion will go towards the scheme. It is set to provide $2 per kilogram of renewable hydrogen produced between 2027-28 and 2039-40. Mr Kroger and former Labor Senator Stephen Conroy joined Sky News host Andrew Bolt on Monday night, where the pair were asked about whether the Opposition should be doing more to push back against the government's 'green hydrogen dream'. 'The nuclear power was a good cover that kept everybody, Nationals and Liberals, in the same cart, and until the opposition can fundamentally resolve the direction they want to go, they're going to not be able to prosecute this case,' the former Labor Senator said. Mr Kroger meanwhile slammed the country's investment into green hydrogen, which he said required an 'enormous amount' of water, land and regulation to get up and running. 'It's very expensive and no one's buying it in Australia,' Mr Kroger said. He said the pursuit of green hydrogen over other energy sources should be a matter for the private sector rather than the government. 'We used to have a thing in Australia that governments shouldn't pick winners,' Mr Kroger said. Since coming to power in 2022, he said the government's mentality had been that they can 'fix everything'. 'Let's wait and see green hydrogen develop to commercial levels around the world and save our money, and then we can just copy them rather than waste billions of dollars of the Australian government's money, where potentially this may not work at commercial scale,' he said. The government's renewables agenda has already faced criticism across the sector, with leading energy and environmental experts slamming Energy Minister Chris Bowen's plans. In an article published by The Australian last week, Mr Bowen had stated there had not been much evidence to support the 'noise' against renewables. However, Centre for Independent Studies energy program director Aidan Morrison claimed 'there's just not a chance' the Energy Minister's renewable energy agenda could be implemented according to Labor's 2050 timeline. 'It's like we're kicking around ice on the deck of the Titanic thinking: 'Oh, that was fun to brush up against that'. We haven't taken seriously how badly things are shaping up' Mr Morrison told Sky News last week. Meanwhile, one of Australia's largest green hydrogen backer, metal mining giant Fortescue, slashed about 90 jobs working on the energy source last week. The move sparked further criticism from Mr Morrison, who told that green hydrogen was 'hopelessly impractical" as an alternative fuel. 'It's extremely difficult to store and move. There's limited demand for hydrogen as a chemical feedstock, which is economically met by methane reformation from coal or gas,' Mr Morrison said.
Sky News AU
14-05-2025
- Business
- Sky News AU
Fortescue axes 90 green hydrogen jobs as Centre for Independent Studies' Aidan Morrison slams 'hopelessly impractical' energy source
Australia's largest green hydrogen backer has axed about 90 jobs working on the energy source, sparking criticism there is "no future" for the energy source as it is "hopelessly impractical" as an alternative fuel. Metal mining giant Fortescue, spearheaded by green hydrogen promoter Andrew 'Twiggy' Forrest, on Tuesday laid off staff members who worked on hydrogen projects across the nation. The workers at Fortescue's hydrogen unit in Western Australia and its electrolyser facility, where hydrogen is separated from water to produce green energy, in Queensland were offered redundances or redeployment within the company. Fortescue's move sparked criticism from the Centre for Independent Studies' energy director Aidan Morrison who said efforts to prop up the energy source, many which are driven by the Albanese government, were futile. "This is what it looks like to see a concerted effort at consensus-farming slowly getting unwound: paper projects being quietly scrunched up and binned at politically convenient moments,' Mr Morrison told 'Green hydrogen never was a thing. It won't be in the future either. It was built on hopeful hand-waving from the outset. 'It's hopelessly impractical as an alternative fuel. It's extremely difficult to store and move. There's limited demand for hydrogen as a chemical feedstock, which is economically met by methane reformation from coal or gas. 'There's no evidence that demand at the volumes that renewables enthusiasts have been spruiking will emerge and there's no way that wind and solar could meet that demand at a reasonable price if it did." A Fortescue spokesperson said the mining giant was focused on developing a green iron industry in Australia with 'green hydrogen playing a critical part in making it a reality'. 'To ensure we can produce the large amounts of green hydrogen we need to make green iron, we are refocusing our efforts into the research and development of new technologies that will deliver green molecules at scale, efficiently and cost-effectively,' the spokesperson said. 'Fortescue has rapidly advanced its electrolyser technology capabilities. The science has now evolved, and we are moving with it.' It is understood the sackings come as Fortescue is looking to its Gladstone, Queensland, facility - called PEM50 - for the research and development efforts. The recent sackings come after Fortescue revealed 700 redundancies in July 2024 in a sweeping restructure of the company that consolidated its mining and energy arms into one division. Mr Forrest has spent years promoting the benefits of green hydrogen, with the company originally planning on producing 15 million tonnes per year by 2030. Labor's net-zero plans include a Hydrogen Production Tax Incentive as part of its Future Made in Australia Act. More than $6.5 billion will go toward the scheme, which provides $2 per kilogram of renewable hydrogen produced between 2027-28 and 2039-40. The policy came a year after Labor announced $2b towards its Hydrogen Headstart program, which looked to invest in large scale hydrogen projects.
