Australia’s $2bn for hydrogen and Ireland’s offshore wind auction: The energy transition success stories of the week
Several major movements in the clean energy transition have taken place this week, including Australia’s $2bn package for renewable hydrogen. Here, we round up the announcements you may have missed.
Every weekend, edie usually charts five sustainability success stories from around the world under the pillars of energy, resources, infrastructure, mobility and business leadership.
But, this week, there has been an influx of success stories purely in the energy space. This special feature documents how cities, states, regions and nations have moved to accelerate energy decarbonisation this week.
1) Australia touts AUD$2bn renewable hydrogen package
As the week began, Australia published its annual budget – and there were some big wins for the energy transition.
Chief among them was a pledge for AUD$2bn (around £1.1bn) of funding to scale the nation’s first large-scale green hydrogen projects. Such projects produce hydrogen by electrolysing water in processes powered by 100% renewable electricity.
The funding will be allocated under a scheme called ‘Hydrogen Headstart’. The scheme’s design is that of a contracts for difference auction – developers are handed government contracts providing them with a long-term subsidy and steady price. Of the funding, $2m will be ring-fenced for projects supporting native communities.
Also in the Budget were multi-million-dollar funding commitments to solar and wind and to a rapid review of the state of Australia’s energy transition. Additionally, Ministers confirmed more than AUD $1.6bn to support energy efficiency upgrades to homes and small businesses.
Australian Treasurer Jim Chalmers called the package the nation’s “biggest ever investment in energy transformation”.
Nonetheless, Australia did not end or scale back the Fuel Tax Credit, as some green groups had hoped. It also provided AUD$6.7bn for a new gas strategy.
2) Ireland hosts its first offshore wind auction
Thursday (11 May) saw Ireland selecting four projects with a combined capacity of almost 3.1GW to benefit from its first offshore wind auction.
Commonly known as ORESS 1, the auction round has awarded contracts to projects with an average price of 86.05 cents per megawatt hour. This is one of the lowest prices paid by an emerging offshore wind market globally, showing an increasing appetite for wind from developers, even with low subsidies. Developers are being encouraged to pass wholesale energy price savings on to customers.
Should all four projects come online by 2030, they will be able to meet around one-quarter of Ireland’s projected electricity demand.
“The results are further evidence of what many of us have known for a long time; that we, as a nation, can develop and produce enormous quantities of clean energy – securely and at low cost,” said Irish environment and climate minister Eamon Ryan.
3) IEA announces first critical minerals summit
We will have all seen the growing mountain of research into how growing demand for renewable energy and electrified technologies will increase, dramatically, demand for critical minerals.
To help join up global efforts to avoid shortages and ensure that the energy transition is more circular and just, the International Energy Agency (IEA) is hosting its first summit on critical minerals and clean energy, it announced this week.
The summit is set for Paris at the end of September. It will convene mineral producers and consumers, investors and civil society representatives. Ministers will also be in attendance, with eight countries having confirmed that they are sending delegations.
“We see an urgent need to bring together governments, industry, investors and other stakeholders to collectively address questions that will have a profound impact on the future of energy security and global efforts to reach net zero emissions,” said IEA executive director Fatih Birol.
Elsewhere, the IEA confirmed that Italy is on track to meet its national energy efficiency and renewables targets.
4) Final investment decision reached for battery storage at former coal power plant
Coal supplies around 2% of the UK’s electricity mix, down from 30% in 2014, and will be phased out entirely by the end of 2024. As more renewables come online, new infrastructure is needed to maintain energy security due to the intermittent nature of generation.
SSE’s renewables arm this week confirmed the final investment decision for a new 300MWh battery storage system at the site adjacent to its former Ferrybridge power station. By the end of next year, the site of the coal-fired power station in Yorkshire will host the 150MW battery project.
The battery will be the business’s second in the UK; it already has a 50MW array under construction in Salisbury, Wiltshire.
“Located next to the former Ferrybridge coal power station, this important new project demonstrates clearly the transition to net-zero while supporting new green jobs,” said SSE Renewables’ director of solar and battery, Richard Cave-Bigley.
5) Lords beef up renewables provisions in UK Energy Bill
The UK’s Energy Bill is finally back in the House of Commons and, on its passage through the House of Lords, several key amendments were made that could accelerate the national energy transition.
Lords backed amendments that would:
- Require a ban on new coal mines in the UK within six months of the Bill passing
- Ban routine gas flaring by 2025, not 2030 as currently required
- Give energy regulator Ofgem a net-zero remit
- Make it easier to develop community renewable energy projects in England
MPs have also added an amendment that would give the North Sea Transition Authority greater powers to create a map of the North Sea’s carbon storage potential.