Iberdrola to invest €1.1 bn in green hydrogen and methanol plant

Iberdrola has announced intentions to invest more than €1.1 billion (around $1.7 billion) in a green hydrogen and methanol plant in Tasmania.

Iberdrola is partnering with Australian hydrogen developer Abel Energy to build the plant in Bell Bay. The Australian government is backing the project.

Iberdrola and Abel Energy said the plant will be one of the largest of its kind in the world, capable of producing 300,000 tonnes of green methanol per year to use as marine fuel.

Iberdrola noted shipping companies since 2021 have been opting for large ships designed to run on ultra-clean-burning green methanol.

It said the transition would eliminate air pollution in ports, mitigate the risk of oil spills and reduce greenhouse gas emissions generated by fossil fuels.

Iberdrola Australia CEO and managing director Ross Rolfe said the company is committed to helping Australian businesses in sectors where the transition to clean energy has historically been more difficult.

Shipping Australia welcomed the “exciting news” of Iberdrola’s investment in green methanol production.

SAL said there are currently about 90 methanol plants around the world, which together produce around 110 million tonnes of methanol.

It said the current size of the world market for cargo ship fuel is about 229 million tonnes and it has a value of US$130 billion per year.

SAL recalled Maersk’s announcement in August 2021 that it had placed an order for eight large container vessels that would be powered by methanol.

Maersk has put in further orders for large methanol-powered ships since then, and has made several announcements that it had entered into production and supply deals with a range of methanol producers around the world.

SAL said many companies from different shipping sectors have also announced commitments to methanol-powered ships.

The Tasmanian government said the federal government has also shown support for the Bell Bay hub by committing $70 million under the Clean Hydrogen Industrial Hubs program.