I travelled to Whyalla last week with the Leader of the Opposition and the Shadow Treasurer to meet with some of the many contractors that are impacted by the crisis at the Whyalla Steelworks and are owed money by GFG.
It was clear that the people of Whyalla are over the promises, the grand visions and they simply want to get back to work and produce steel.
They have lost faith in GFG. There is a major trust deficit which can only be overcome if GFG pay their debts.
It is also clear they have also been misled by the Premier and a Labor State Government that has been totally distracted by green hydrogen promises over the last 4 years.
In 2021, the Premier promised a green hydrogen power station.
Since then we have seen that hydrogen plan delayed and downgraded with the Premier making changes on the go.
Worse, we have seen global energy companies walk away from their hydrogen plans, while the Premier arrogantly pushes on regardless of the cost to South Australian tax payers.
Twiggy Forrest announced Fortescue will pull back on their hydrogen plans because of how expensive hydrogen is.
Woodside Energy has backed away from plans for hydrogen
Origin Energy abandoned its hydrogen venture with Chief Executive Frank Calabria, saying
‘there remain risks and both input cost and technology advancements to overcome’.
A major element of the input costs for hydrogen projects is the electrolyser equipment that produces the hydrogen.
Credible organisations such as:
have each released reports showing the cost of electrolysers has surged since 2021.
In 2021, next to a big picture of the now Premier, Labors Hydrogen policy document promised:
“Labor will build 250MWe capacity of hydrogen electrolysers”,
and will be operational by the end of 2025 for a cost of $220 million
That’s $880 000 per MW.
Recently Australia’s CSIRO released their latest draft 2024-25 GenCost report which shows electrolyser costs have increased by over 41 per cent in the last year alone and now have a unit cost of $2.7 million per MW.
That’s over 3 times more per MW than Labors costing promise.
Using the CSIRO’s costings for hydrogen electrolysers a 250MWe alkaline electrolyser would cost $676 million - not the $220 million as promised by Labor in 2021
with the cost of the electolysers alone exceeding the original $593 million budget Labor is still clinging to.
This massive $456 million blowout sends the project surging past $1 billion for a hydrogen power plant that is not aimed at delivering cheaper electricity bills for struggling South Australian households.
The Malinauskas Government has repeatedly withheld the costs of its plans over the last three years – citing the process is in procurement.
But they know about these massive cost increases for electrolysers and are lying to South Australians about the true cost.
But their actions reveal this lie - they certainly don’t have any intention of running the power station on hydrogen to start with because in September last year they went out to tender to run the turbines on gas.
Gas that is trucked in by diesel powered B-Double road trains.
That was never part of their plan but again shows Premier Malinauskas making things up as he goes.
No wonder we have record electricity prices in South Australia.
Note also that this B-Double trucking gas tender was put out before the issues at the Whyalla steelworks escalated.
But now we have the Government using the very major crisis at the Whyalla Steelworks to back away from their hydrogen promise
Let’s be clear the Government’s Hydrogen Plan was a government initiative to generate electricity using hydrogen.
There was no mention of GFG in their 2021 announcement and only one mention of green steel in their 20 page policy document.
The State Government is desperately trying to create a scape-goat to blame for their own pre-election idea.
The State Government knows their green hydrogen dream is now becoming a green nightmare.
The nail in the coffin was the Queensland State Government abandoning its hydrogen venture - again because of surging input costs.
The Premier’s hydrogen promise is in disarray and he now needs to come clean with South Australians about the true cost of his hydrogen hoax.
