Partners named for South Australian's world-biggest hydrogen plant near Whyalla before it is put on ice
Concepts for the South Australian government's shelved $600 million plant to produce hydrogen near Whyalla on upper Spencer Gulf. The plant was to be connected to the South Australian electricity grid and to play a role in soaking up the state's excress production of renewable energy from wide and solar.
Images courtesy South Australia government
International gas and engineering giants ATCO Australia and BOC Linde were announced in 2023 as preferred consortium partners in the South Australian government $600 million plant to produce hydrogen near Whyalla on upper Spencer Gulf – a project that was put on ice in early 2025.
The shelving of the major project, touted as the world's biggest of its type, was triggered by the switching of funding to rescue debt-ridden Whyalla steelworks in early 2025.
The proposed hyddogen plant included building a 250MW (megawatt) electrolyser and a 200MW hydrogen gas generator. Its 100% hydrogen-operated fast-startup turbines was to be be a world first. ATCO and BOC Linde were chosen from 29 proposals. Epic Energy, a gas pipeline company branching into large solar projects, would provide a dual storage and transmission pipeline for the plant.
The Whyalla hydrogen plant would said to be crucial in helping the state and energy market operator manage the growing share of wind and solar in the grid that regularly delivered more than 100% of South Australian energy demand. The electrolyser would help soak up excess renewable energy, particularly in the middle of the day when rooftop solar output alone met all state demand on occasions, while the hydrogen gas generator would operate as a “peaking” plant to meet demand peaks in the evening and other times. The state government pointed to the possibilities of the green hydrogen produced being used for a major push into “green iron” at Whyalla steelworks.
South Australian premier Peter Malinauskas called the hydrogen vision a “a world-leading opportunity for South Australia, that has the potential to rival Victoria’s gold rush, the coal boom in Queensland, or Western Australia’s development of iron ore and gas.” Malinauskas said South Australia had all the things the world would need to decarbonise: abundant copper and magnetite, the world’s best coincident wind and solar resources, world-leading renewable energy penetration and soon, the ability to harness this abundant clean energy in the form of hydrogen: “We can use this clean hydrogen to firm our electricity grid, but more than that, we can use it to help reindustrialise the upper Spencer Gulf, creating thousands of jobs.”
State energy minister Tom Koutsantonis says the green hydrogen would also be used by other customers, helping decarbonise the state’s industry, and for potential exports. The state also was looking to develop a huge green hydrogen and green ammonia export hub at Port Bonython, near Whyalla. Koutsantonis said the Whyalla hydrogen power plant would continue South Australia’s leadership, with exceptional sun and wind resources, towards 100% net zero carbon emissions. The hydrogen power plant at Whyalla would use hydrogen to store renewable energy, “enabling us to ship the sun beyond our shores.”
The Whyalla electrolyser and generator were both be owned and operated by the state government. The demand created by the electrolyser will mean the large output from state’s wind and solar would have to be less curtailed while also helping the Australian Energy Market Operator deal with its big headache: significant drops in operating demand. Koutsantonis told RenewEconomy website the Whyalla power generator would bid into the energy market at the marginal generation cost to help moderate wholesale electricity prices in the demand peaks.
Koutsantonis said that, while some people might be cautious about this, South Australia’s overproduction of renewable energy was either being exported interstate or turned off: “That’s just a completely unjustifiable solution”. Koutsantonis said the government’ vision was to “invest our money to try and prove up electrolysis at grid scale can be done effectively and cheaply with the overproduction of renewable energies … You can use that energy to firm renewable energy into the grid. What we’re all paying for, through higher power prices, isn’t renewable energy: it’s the gap.”
