Andrew “Twiggy” Forrest, the founder of Fortescue Metals Group, remains one of the most vocal global supporters of green hydrogen, despite multiple setbacks.
In 2021, Forrest announced plans to manufacture 15 million tonnes of green hydrogen per year by 2030.
He saw green hydrogen as a critical solution for decarbonising industries such as steel, shipping, and heavy transportation that are difficult to abate.
Fortescue Future Industries (FFI), the company’s green energy division, was expected to spearhead this transformation with projects in Australia, the United States, and other continents.
However, Fortescue has since scaled back its hydrogen ambitions, citing challenging market conditions, limited technological adoption, and high energy costs.
The corporation announced 700 job cuts and cancelled important projects, including:
- Gladstone, Queensland’s PEM50 electrolyser plant
- The Arizona hydrogen project in the United States
The Australian government is now pursuing repayment of grants associated with the abandoned Gladstone project.
Despite the setbacks, Forrest remains committed to green hydrogen.
“Our vision for Fortescue has not changed. I truly believe in the power that green hydrogen will unlock for decarbonising hard-to-abate industry”, Forrest said in 2024.
Forrest reiterated its support for green hydrogen, telling investors this week that green hydrogen remains “key” to Fortescue’s future, despite having walked away from several much-hyped projects and cutting jobs in the sector over the past year.
Forrest’s green hydrogen ambitions were always pure fantasy.
EnergyQuest noted in March that Forrest’s and the government’s 15 million tonne green hydrogen target would literally require twice as much electricity to create as Australia produces in a year:
“A key drawback of the existing green hydrogen production process is that a considerable portion of the renewable energy used to produce the hydrogen is lost in the production process,” EnergyQuest said.
“It takes around 45 kilowatt hours to produce one kilogram of green hydrogen, but that one kilogram can only be used to generate 30kWh of electricity, and production of green ammonia involves a further 13-25% energy loss.”
EnergyQuest estimates the electricity required to generate 15 million tonnes of green hydrogen—the federal government’s target by 2050—requires more than double Australia’s total annual electricity generation.
Indeed, the poor economics of green hydrogen have led to the widespread cancellation of projects across Australia and the world, including in China.
According to The AFR, “more than 130 projects linked to hydrogen have received federal taxpayer money going back to 2017, according to the government’s grants register. While many pre-date this government, easily the largest came after the 2023 budget frenzy”.
In March, The Australian revealed that the development of 99% of the announced hydrogen capacity had not progressed beyond the idea stage.
Despite the repeated failures, Minister for Climate Change and Energy Chris Bowen promised to waste more taxpayer money on the green hydrogen fantasy, pledging $432 million to revive the Hunter Valley Hydrogen Hub, promising “long-term, high-quality jobs for the region, while decarbonising industries that are vital to our economy”.
The reality is that green hydrogen is totally uneconomic. It is expensive to produce, costly to transport, expensive to store, expensive to distribute, and expensive to use.
“Converting electricity to hydrogen and back to usable energy wastes a substantial portion of that original energy”, reported Clean Technica in March. “Essentially, it’s a leaky bucket scenario—by the time you’re done transporting and converting hydrogen, you’ve lost around two-thirds of your initial energy input”.
“Advocates often fall victim to the “appeal to future possibilities” fallacy, painting a glowing image of a hydrogen economy without honestly confronting today’s technical and economic realities”, Clean Technica wrote.
I highly recommend the interview with former CSIRO Divisional Chief (minerals and energy) Tom Biegler on the Baseload Podcast.
Biegler dispels the myth that green hydrogen is a viable technology for Australia.
Neither Chris Bowen nor Twiggy Forrest seems to consider the realities or the costs to consumers and taxpayers associated with renewable energy.
