A leading hydrogen expert has expressed doubt over Labor's $2.4 billion plan to save the Whyalla Steelworks, arguing that the investment lacks the scale and ecosystem needed to make the transition to green steel a success.
A leading hydrogen expert has criticized Labor 's multi-billion dollar pledge to revitalize the Whyalla Steelworks , arguing that the investment falls short of what's needed to make it a truly sustainable green steel powerhouse. The government announced $2.4 billion to rescue the embattled mill, with $1.9 billion going towards upgrading the facility and transitioning it into a “ green steel ” manufacturer.
Of this investment, about $500 million comes from Labor’s $1 billion Green Iron Investment Fund, which was simultaneously announced by Industry Minister Ed Husic. Professor François Aguey-Zinsou, a green hydrogen expert at the University of Sydney, questioned if the investment would be enough to ensure the Whyalla Steelworks could thrive. He compared the situation to investing in solar manufacturing: “It's like the government saying they are going to put $1 billion (into) solar manufacturing in Australia. How much money have the Chinese invested in that?” He pointed out that China controls the full supply chain for solar manufacturing, meaning even with a billion-dollar investment in Australia, the plant would still rely on global supply chains.Aguey-Zinsou argued that the Australian government needed to create a complete ecosystem to drive hydrogen production if it wanted to turn Whyalla into the green steel producer it desires. He cited Asian nations like Japan, China, and Taiwan that have poured significant resources into emerging technologies, becoming leaders in their respective fields. “One thing the Japanese have been good at, or the Chinese have been good at, or the Taiwanese have been good at with the semiconductor industry, is that they decided this is where (they) want to be the leader,” he said. “We are going to build the education sector so we have the skills, we are going to build the energy sector so we have the innovation, we are going to develop the manufacturing capability so we know how to produce that scale and at cost.”He stressed the need for a bottom-up approach, involving government incentives, workforce preparation, and a clear agenda to foster the hydrogen industry in Australia. He argued that relying solely on the private sector wouldn't be enough. This comes as the Whyalla Steelworks was forced into administration earlier this week, facing significant financial difficulties including unpaid royalties to the SA government and SA Water. The company's struggles coincide with other companies like Fortescue, Woodside, Origin, and the Queensland government abandoning their pursuit of green hydrogen. The situation highlights the challenges facing the green steel industry in Australia, despite Labor's considerable investment.
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