Iberdrola Australia, a subsidiary of Spain-headed renewable power major Iberdrola Group (Iberdrola), and Power-to-X (PtX) project developer ABEL Energy Pty Ltd, have announced plans to build a green hydrogen and green methanol production plant at Bell Bay in northern Tasmania.
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Called Bell Bay Powerfuels, the project is backed by the Australian government and will involve an investment of EUR 1.1 billion by Iberdrola.
Green hydrogen and e-methanol
Bell Bay Powerfuels will use Tasmania’s renewable hydro- and wind power capacity to produce green hydrogen via electrolysis of water at a site in the Port of Bell Bay.
The project will incorporate one of the largest electrolyzer units – over 100 MW – to be installed in Australia.
The green hydrogen from the plant will be available for domestic customers. The hydrogen will also be reacted onsite with biogenic carbon dioxide (CO2) to produce green methanol.
Iberdrola Australia’s investment in the Bell Bay Powerfuels Project demonstrates our commitment to helping Australian businesses reduce their carbon emissions in sectors where historically, both technically and economically, it has been more difficult to make this transition, said Ross Rolfe, CEO and Managing Director of Iberdrola Australia.
Bell Bay Powerfuels will produce 200 000 tonnes of green methanol per year in its first phase of development, rising to 300 000 tonnes in its second phase making the project one of the largest in the world.
The first production is scheduled for 2025.
We are delighted to be able to combine Iberdrola’s global expertise in green hydrogen technologies with ABEL Energy’s local knowledge and commercial drive, said Ross Rolfe.
The green methanol will be used to supply the maritime market as well as for other applications.
ABEL Energy is also planning a small dimethyl ether (DME) plant that will be built either onsite or at another location, producing renewable DME from methanol for local industry.
The construction of the Bell Bay Powerfuels plant, which combines investment in renewable generation with investment in green hydrogen capacity, is characterized by a collaborative approach to creating long-term value for the Tasmanian community.
It will rely on the best technology in the world and will create 500 jobs. Of these, 200 direct and indirect jobs will be locally recruited.
Together with Iberdrola, we look forward to driving green hydrogen to commercial scale in Australia and establishing a new climate technology industry that will benefit the Tamar Valley community and its future generations. We are delighted to have the support of Iberdrola as a financial partner and as an expert in building and operating large-scale renewable energy in Australia and around the world, said Michael van Baarle, Co-Founder and CEO of ABEL Energy.
Commitment to green hydrogen
For its part, Iberdrola is developing 60 renewable and green H2 initiatives in eight different countries. Its goal is to reach 35 000 tonnes of hydrogen per year by 2025 and more than 350 000 tonnes per year by 2030.
To this end, the company has a project portfolio of 2.4 GW in different regions, mainly in Spain, the United States, and Australia.
As it did with renewables 20 years ago, the company has become a ‘first mover’ in this new technological challenge of producing and supplying green hydrogen.
According to Iberdrola, the use of green hydrogen should be focused on applications where there are no other alternatives.
In other words, to replace grey hydrogen (produced from fossil fuels) with green hydrogen (produced by renewables) in sectors where it is currently used, such as fertilizers, methanol, or refineries.
Investing in REPowering Australia
Iberdrola has made a strong commitment to the Australian energy market with the acquisition 2020 of Infigen Energy, Australia’s leading renewable energy company.
The company will invest between EUR 2-3 billion in Australia with the aim of boosting the switch to renewables in the country and reaching 4 GW installed capacity in the coming years.
The commitment is in addition to the EUR 2 billion invested by Iberdrola Australia so far in projects such as the Avonlie solar farm and the Flyers Creek wind farm in New South Wales (NSW), and the Port Augusta renewable energy farm in South Australia (SA), the largest hybrid wind-solar farm in the southern hemisphere.
In the first half of this year, Iberdrola Australia acquired the rights to the world’s largest wind farm at Mount James, with 1 GW of capacity, the 360 MW Broadsound photovoltaic plant in Queensland (QLD), and has invested in a smart solutions business, Autonomous Energy, which offers tailored energy products for commercial and industrial companies.
The company has currently installed 1 122 MW of renewables (wind, solar, and batteries). In addition, it is building two new facilities with a combined capacity of 391 MW, which is scheduled for commissioning in 2023.
Earlier this year, Iberdrola set up its networks business in Australia, as the country’s electricity grids, mainly transmission infrastructure, will need to be dramatically expanded to capture wind and solar resources and transport power to coastal population centres.
Federal and state government initiatives have created a climate of confidence for foreign investment to develop new renewable generation and transmission projects.