AGL Energy has signed a Memorandum of Understanding (MOU) with Fortescue Future Industries to explore the development of a green hydrogen facility in line with its vision for an industrial energy hub at the site of the Liddell and Bayswater power stations in the Hunter Valley.
As part of its plans to develop the ‘Hunter Energy Hub’, this project would be powered by clean energy, delivered through grid-scale batteries, solar thermal storage, wind, pumped hydro and the co-location of industry.
AGL chief executive officer and managing director Graeme Hunt said this was the first major step in identifying the potential demand for green hydrogen in the Hunter Valley, including domestic and export pathways.
Hunt said: “We have a long history of supporting the development of new technology as early investors in wind and other renewables and we want to do the same in partnerships with Australia’s emerging hydrogen industry.
“Fortescue is leading the charge on the development of green hydrogen in Australia and abroad, and we are excited to bring our site and expertise in large-scale renewable generation to the fold.
“We believe this project, along with the others in our Hunter Energy Hub, could drive the development of around 1,000 permanent jobs across energy production, advanced manufacturing, recycling and the production of chemicals.
“Over the next 12 months we will undertake a feasibility study which will map key operational and commercial plans for the project and enable the development of a production timeline.
“Early estimates suggest the site can ultimately support a hydrogen facility of GW scale, but we will also test critical inputs including renewable energy costs, firming requirements, electrolyser capital costs, logistics and utilisation.”
AGL chief operating officer Markus Brokhof said that upon completion the Hunter Energy Hub would be the first of its kind in Australia and set a model for other sites and industry in Australia.
Brokhof continued: “Our aim for the hub is to develop strong partnerships that enable an efficient ecosystem and create a circular economy.
“Liddell and Bayswater benefit from unique energy infrastructure, positioned with strong grid connectivity, established transport links, workshops and proximity to water supply and industrial activity.
“As we move towards Liddell’s closure, I want to reaffirm our strong commitment to supporting our workforce and the Hunter region.
“The site and people who have worked here have been the backbone of the electricity grid and we’re committed to seeing it continue its legacy in the next phase of its life.
“The future is bringing the best in low-carbon technologies together to shape a cleaner energy future to ensure customers have sustainable, secure and affordable electricity.”
FFI founder and chair Andrew Forrest AO said FFI’s goal was to turn regional Australia into the global green energy heartland and create thousands of jobs now and many more in the future.
Forrest added: “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.
“I wish to thank my forward-looking friend AGL managing director and CEO Graeme Hunt, who was the first iron ore industry leader to declare my then embryonic iron ore company, Fortescue Metals Group, as a very real future player in the highly competitive iron ore industry – thank you Graeme for exercising the same vision today.
“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 Graeme are fully supported by global investors and local government alike.
“This is another important step in turning the corner once and for all, to implement the technologies carbon emitters, like us, to reach net zero.”