Australia rejects plans for $48b wind, solar, hydrogen project

MELBOURNE • The Australian government has rejected plans for a US$36 billion (S$48.5 billion) wind, solar and hydrogen project in a remote area of Western Australia, leaving what would have been one of the world's largest green energy projects in limbo.

In a decision dated June 15 and published on the environment department's website, Environment Minister Sussan Ley ruled that the project, the Asian Renewable Energy Hub (Areh), "will have clearly unacceptable impacts" on internationally recognised wetlands and migratory bird species.

The project, located in the state's Pilbara region, was designed to initially build 15 gigawatts (GW) of renewable energy capacity, eventually to be expanded to 26GW and produce green hydrogen and ammonia for export.

The government had awarded the project fast-track approval status last September, touting the jobs, clean energy for local industry and large-scale export opportunity that it would bring.

Areh is being developed by the privately-owned InterContinental Energy, renewables developer CWP Energy Asia, top global wind turbine maker Vestas and a Macquarie Group fund.

The environment minister cited the expansion plan in the decision to reject the project. The original plan had won environmental approval last December.

The proposed enlargement called for a port facility for ammonia; a town that would be home to 8,000 people including project workers; expanded solar arrays; ammonia, hydrogen and desalination plants and storage facilities; and a pipeline route for transporting ammonia, seawater and brine through wetlands.

"We are now working to understand the minister's concerns, and will engage further with the minister and her department as we continue to work on the detailed design and engineering aspects of the project," the Areh consortium said in a statement.

The project, which has been on the drawing board since 2014, was originally planned to generate wind and solar power and transmit it via an undersea cable to Asia. But the plans were changed last year with the aim to use clean power to split water to produce hydrogen and ammonia for export.

Australia's Clean Energy Council said yesterday it expects the government to work with Areh to assess and address any environmental impacts.

"If the government is to be taken seriously on developing a hydrogen economy, companies prioritising genuinely zero emissions projects should be assisted to reach a final investment decision," said Mr Dan Gocher, climate and environment director at the Australasian Centre for Corporate Responsibility.


A version of this article appeared in the print edition of The Straits Times on June 22, 2021, with the headline 'Australia rejects plans for $48b wind, solar, hydrogen project'. Subscribe