Back in February 2020, the traditional coal and gas hub of Gladstone, Queensland, put its hand up to become Australia’s hydrogen mecca. The city was selected to host two ambitious projects – a gigawatt-scale green hydrogen-ammonia installation and a gas injection facility – in order to blend green hydrogen into the city’s natural gas network.
This week, Japan’s Sumitomo announced that it has signed a front-end engineering and design contract with JGC Holdings Corp. for a solar-powered green hydrogen production plant in Gladstone. The plant will produce 250-300 tons of hydrogen per year, and could scale up in the future.
It is perhaps not surprising that Sumitomo is turning to green hydrogen, considering the company’s stunning US$250 million loss on its Western Australian Bluewaters coal-fired power station. The loss ensured that 2020 was the company’s worst-ever annual performance.
The 434 MW Bluewaters coal-fired power station is Western Australia’s newest coal power station, completed in 2009 and generates approximately 15% of the state’s energy. Interestingly, it is the state’s only privately owned coal-fired power station. According to a report from the Institute for Energy Economics and Financial Analysis (IEEFA), the rapidly accelerating transition to renewables has ensured that Sumitomo is now left holding a stranded asset.