Hydrogen Industry

Mr PATTERSON (Morphett) (15:17): The Malinauskas Labor government has been totally distracted by their green hydrogen promises over the last four years, while South Australian working families are paying the highest electricity bills on record. Today, we find out that the Premier has scrapped the only energy policy that he took to the 2022 election. It is not surprising, as his flagship hydrogen project has been taking on water for years and has now sunk.

Let's remind South Australians what was promised next to a big picture of Premier Malinauskas. It stated

Labor will build hydrogen storage capacity of 3,600 tonnes of liquefied hydrogen storage, two months of hydrogen power generation for $31 million. Labor will build a 200-megawatt combined cycle turbine running on green hydrogen for $342 million. Labor will build 250 megawatts capacity of hydrogen electrolysers for $220 million. Labor will ensure all projects will be operational by the end of 2025 and cost $593 million.

The first of these promises to go was back in December 2022, when Labor slashed the amount of hydrogen storage from the 3,600 tonnes to 100 tonnes. That is less than 3 per cent of what was promised. Then all of a sudden this hydrogen power project was not providing two months of power generation, and it needed an offtaker to justify such a large bank of electrolysers. At that time, the Premier was starting to make things up as he went along.

In 2023, we had it confirmed by both the Minister for Energy and the CEO of the Office of Hydrogen Power SA that Labor's hydrogen power station was not going to bring down power bills for South Australian families, with the minister stating in parliament, 'It's commercial and industrial customers we are targeting.'

With South Australians paying record electricity bills, the Malinauskas Labor government started changing the commentary around this project. They began talking up green steel, tying their green fantasy to GFG and Mr Gupta. Remember, Labor's 2021 hydrogen policy was all about hydrogen electricity generation to supply, and I quote, 'secure power to South Australian-based factories and mining companies'. In their 20-page document, there was only one mention of green steel.

In 2024, the Premier broke another promise when he gave up on the promise to construct a base load combined-cycle turbine, instead opting for a GE LM6000 aeroderivative open-cycle turbine, which is effectively just a jet engine that usually hangs off a plane wing. South Australians thought they were getting base load power, but instead they were getting a power station that would be a peaker. Then in May 2024, South Australians found out from AEMO that the hydrogen power plant would not be operational until late 2026, as opposed to December 2025 as promised, so the government was then forced to admit that they would not be meeting their December 2025 deadline—the third broken promise.

During this time, South Australia was also experiencing major construction cost escalation, but the government clung to the illusion their project would still be a $593 million one. The CSIRO's draft 2024-25 GenCost report showed that electrolyser costs have increased by more than three times per megawatt than the Premier's initial promise. Using these CSIRO costings for electrolysers, the 250-megawatt electrolyser that Labor promised would cost $676 million and not the $220 million that they stated. This is a massive cost blowout—$456 million to be exact—taking the project to well over $1 billion for a hydrogen power plant that is not meant to bring down power prices for struggling South Australian households.

Of course, the government knew the writing was on the wall back in September 2024. They broke their electrolyser promise by going out to tender to run it using gas, but this gas was going to be trucked in by B-double trucks. We find out today these turbines are now going to be sold—probably on the Trading Post. So the Premier and his Labor government have now broken all of their major promises—all four—from their hydrogen plan. These promises were all broken before the issues at the Whyalla Steelworks escalated, yet we have the Malinauskas government using the major crisis at the Whyalla Steelworks to break their hydrogen promise.

Remember: fixing the ramping and this hydrogen promise were their two centrepiece election commitments. Now we know that their hydrogen election promise is scrapped—and ramping? It is the worst it has ever been. So it is clear you cannot trust anything that Premier Malinauskas says, and it turns out his election hydrogen promises have been revealed as a hydrogen hoax.