After granting the Port Kembla power station Critical State Significant Infrastructure classification, the NSW government will expedite planning permissions for what may become one of Australia’s first gas-hydrogen co-fired power stations.
The $1.3 billion project is being constructed by Andrew Forrest-backed Squadron Energy and is part of the company’s larger plans to build a gas import facility at Port Kembla, New South Wales.
The Port Kembla project will, at least initially, rely on fossil gas sources and will be located in the Illawarra region’s large industrial district, which already houses the BlueScope steelworks.
According to Squadron Energy, the proposed 635MW power station will be able to co-fire with hydrogen, up to 30% hydrogen by volume during the stages of operation, with the ability to switch the plant to run exclusively on hydrogen by 2030.
Such a commitment would significantly increase demand for hydrogen in Australia, making the Port Kembla project the first in the country to utilise hydrogen as a fuel on a broad scale, while EnergyAustralia is also trying to do the same with its expanded Tallawarra gas generator.
Squadron Energy, a subsidiary of Andrew Forrest’s Tattarang group of companies, is developing the Port Kembla Gas Terminal Project, which is estimated to bring in approximately 100PJ of gas into New South Wales, enough to provide almost 70% of the state’s current gas usage.
The Port Kembla project has been designated for federal government financing through the Underwriting New Generation Investments program; however, despite being shortlisted for this funding support in March 2019, no formal agreement has been signed.
The power station is planned to be built by 2024, which means it will likely begin operations after the closure of the Liddell power station.