Backer of Australia’s two biggest green hydrogen projects claims “breakthrough” on costs

The backer of Australia’s two biggest green hydrogen projects – totalling more than 96 gigawatts (GW) of wind and solar capacity – says a breakthrough in the design of such installations could reduce the costs by between 10 and 20 per cent.

The cost of producing green hydrogen is one of the thorny problems facing proponents of the new industry, and has already killed some of the assumed uses for green hydrogen. But the technology is still considered critical to cut emissions in hard to abate industry sectors.

Intercontinental Energy says a standardised design for the huge production nodes promises to deliver a cost breakthrough for the technology.

“The Node is an architecture that creates a repeatable Lego building block to enable large scale projects, but the detail of the node itself has a level of flexibility,” the company said in a statement sent to Renew Economy.

Scaling up means building a new node. The 70 GW Western Green Energy Hub (WEGH) is expected to need about 35 nodes.

The company is a shareholder in two massive projects located in Western Australia – WEGH around Eucla in the south east of the state, and the 26 GW Australian Renewable Energy Hub in the Pilbara in the north.

But the cost of green hydrogen has not come down as quickly as expected – BloombergNEF said in 2023 that it would be on par with grey hydrogen made with gas by 2030 – and upfront costs for green hydrogen, which currently doesn’t have a market, are still high. 

The production tax credit passed in February offers a tax incentive of $2 per kilogram of renewable hydrogen, but produced between 2027/28 and 2039/40.

All of which means every little bit counts. 

The Intercontinental Energy template was developed in Perth. Over four years that team built a standardised design of solar and wind surrounding a green hydrogen production “node”, as a way to streamline giga-scale projects.

The modular design takes the shortest possible route for each process, before shipping hydrogen out directly to customers via pipelines. Image: Intercontinental Energy

The company says it could cut capex (capital expenditure) by 10 per cent by cutting out bespoke designs, extra electrical infrastructure and reducing storage thanks to pipeline networks to take product to where it’s needed.

Efficiency gains of up to 10 per cent come from finding the most sensible way to get electrons to electrolysers and hydrogen to storage and pipelines. 

“The P2(H2)Node architecture is a breakthrough in clean hydrogen production,” said Intercontinental Energy CEO Alexander Tancock in a statement.

“By eliminating transmission losses and leveraging a modular approach, we are making green hydrogen cost-competitive at scale for the planet.”

According to a document released on the Intercontinental Energy website in April, the node design feeds green energy directly to electrolysers, which use desalinated seawater to make oxygen and hydrogen.

First look

The WEGH project in south-east WA, which InterContinental Energy co-owns with CWP Global and Mirning Green Energy, is likely to be the first place where the template is rolled out. 

That project joined the EPBC queue at the end of January.

Referral documents detailed a project with 35 “nodes” of around 2-3 gigawatts (GW) of wind and solar, with an approximately 1.5 GW electrolyser and/or data centre at the centre of each node.

The documents say the project would be rolled out over a nominal seven stages, which will ultimately result in the installation of up to 70 GW of renewable energy generation capacity from roughly 60 million solar modules and up to about 3,000 wind turbines.

The first phase will be the construction of 8GW of hybrid wind and solar power and production facilities able to make up to 500 kilo-tonnes a year of green hydrogen. 

Fully phased, it would produce around 3.5 million tonnes of green hydrogen a year.

The project is proposed to take in roughly 2.29 million hectares of pastoral leases and crown lands, stretching hundreds of kilometres from north-west of Eucla, near the border with South Australia, towards Cocklebiddy and north of the Eyre Highway to south of the Trans Australian Railway.

• * This article has been updated to include comments from Intercontinental Energy.