A new green hydrogen project being developed in the Mid-West region of Western Australia will scale up to 1,000 megawatts (MW) of electrolyser capacity. 

MercurHy is an export scale project which aims to supply green hydrogen whilst leveraging economies of scale, particularly regarding the supply and purchase of renewable energy. Investor engagement is underway as Xodus targets equity funding for the project from experienced capital and infrastructure partners interested in commercial green hydrogen progressing.

The project provides for a total electrolyser capacity of 1,000MW being installed over three phases: 150MW in Phase 1; 500MW in Phase 2; and 1,000MW by the end of Phase 3. The intent behind scaling the project in this way is two-fold, initially to allow the market for green hydrogen sufficient time to develop and then to capitalise on future electrolyser price reductions.

Western Australia, particularly the Mid-West region, is an ideal location to site the project with strong opportunities to decarbonise nearby local industrial loads. It also has world class renewable energy resources (with existing wind farms in the area achieving up to 50% capacity factors), excellent access to export markets via local ports, access to electrical infrastructure, available land, as well as strong government support.

Xodus continues to progress the commercial strategy for the project, having entered into a memorandum of understanding for hydrogen supply with ASX-listed VRX Silica, a company with long-life, high quality silica sand projects in Western Australia and plans for the manufacture of solar panels locally to supply national and international demand. Xodus has also advanced discussions with other potential offtakers and has the support of local landowners and the Western Australian Government.

Project MercurHy provides a strong economic development opportunity for the region by helping to unlock and decarbonise new industries, which in the case of VRX Silica would see the opening up of domestic capacity for local net zero glass and solar panel manufacturing.

Stephen Swindell, Managing Director at Xodus said: “As we accelerate the global transition to a low carbon economy, the investment landscape is becoming more and more complex as markets, policies and regulations also undergo rapid change. Upscaling of the hydrogen sector is still in its infancy and the local supply chains must be developed further to maximise opportunities.

“Xodus has built its reputation as an energy consultancy committed to delivering a responsible energy future. We believe the world needs high quality, scalable renewable energy projects such as MercurHy to bridge the gap between the size of the currently operational projects and the future gigawatt-sized developments. The aim of this project is to push the supply chain forward, reduce technology risks and achieve cost reductions.

“It’s an exciting project. We have led it from its infancy and have attracted partners to achieve joint success. With the expertise and knowledge to be architects of this opportunity, our aim is to have an active role in energy transition with the high quality, low carbon, economically viable projects that Australia and the world desperately needs.”