Peter Malinauskas’ hydrogen hopes and dreams are in tatters today, as a new State Government tender reveals the truth about his hydrogen hoax.
The Office of Hydrogen Power has put out a tender asking for private sector support to provide two years’ worth of compressed natural gas, or 1,100 TJ per annum, to Labor’s expensive ‘hydrogen plant’ on the Upper Spencer Gulf.
This tender calls for a ‘virtual pipeline’, which is window dressing for what the reality is – diesel powered B-Double road trains trucking gas from one location to the ‘hydrogen plant’ to power the turbines.
According to publicly available information, on the low end of the transport capacity of the B-Double trucks it may require anywhere up to around 90 B-Doubles to supply the required 7.2 TJ of gas requested each day – however the Labor Government must clarify the daily number of B-Double trucks required.
This stands in stark contrast to the clean, green hydrogen powered turbines Peter Malinauskas promised prior to the 2022 State Election – in actual fact, these turbines will be gas powered, supplied via carbon emitting diesel B-Double trucks.
The tender reveals that from 1 November 2025, the ‘hydrogen plant’ will in fact be running on natural gas for up to two years, not 100% hydrogen as claimed.
“We do not know how much this tender will cost taxpayers, but we do know their hydrogen plans have already blown out in cost and are on track to set-back taxpayers over $700 million,” said Shadow Minister for Energy and Net Zero Stephen Patterson.
“Tom Koutsantonis has tried to claim that gas will only be required to start the turbines, however, now it has been revealed that they will need to run on gas for up to four hours a day while Labor wanted South Australians to believe that it would be fully powered by green hydrogen produced on site.
“It is clear the Labor Government would not contract this amount of gas -1,100 TJ a year – if they were confident both in their timings for the electrolyser to come online, and for the amount of hydrogen they are able to produce.
“The fact that the Labor Government is seeking up to two years of gas supply surely means that there is a delay in their procurement of electrolysers, which also begs the question – how long will they be delayed, and will there be further cost blow outs?
“The trucking in of gas to run the turbines is required because of a lack of foresight in relation to gas pipelines, with the Whyalla gas pipeline already at capacity and unable to provide gas to Labor’s expensive ‘hydrogen plant’.
“This is not to mention their lack of confidence in being able to produce the requisite amount of hydrogen to power the turbines within the first two years.
“The cost of electrolysers has increased significantly since Labor’s hydrogen policy was announced in 2021, and production issues to supply 250MW electrolysers are set to hinder the Labor Government’s already delayed timelines.
Just last week we saw Origin Energy abandon its hydrogen venture in the Hunter Valley as the ‘economics of clean hydrogen projects increasingly fail to stack up’ and that ‘it has become clear that the hydrogen market is developing more slowly than anticipated’. Origin Energy chief executive Frank Calabria, when talking about hydrogen, said ‘there remain risks and both input cost and technology advancements to overcome’.
Senior energy analyst Saul Kavonic has said that the exit of Origin Energy from hydrogen ‘shows how green hydrogen economics are so uncompetitive that even with generous government subsidies, and a captive buyer, it still struggles to work’.
The architect of the first national clean hydrogen strategy, former chief scientist Alan Finkel has said ‘using renewable electricity to make green hydrogen, then store it, then feed it to a converted gas generator is expensive and inefficient’. Mr. Finkel was also quoted as saying that it was ‘increasingly clear that green hydrogen is too expensive’ and Australia was ‘unlikely to use hydrogen for storage of electricity’.
“Peter Malinauskas needs to come clean on if the Government will still be providing 250MW electrolysers for $220 million and how many MW of electrolyser, if any, will be available by December 2025?
“Peter Malinauskas promised a clean, green hydrogen plant, instead South Australians are getting gas powered turbines propped up by diesel fuelled B-Double trucks.”