Fortescue’s $900 million hydrogen project in the US and $1 billion plant in Queensland won’t go ahead. Does Trump play a role here? Are these hydrogen plants simply ‘pie in the sky’? Is Fortescue being forced to repay $60 million to taxpayers? Read on.

For some, this story looked like a failed billionaire pressured into repaying $60 million in Federal and Queensland government support to create green hydrogen power. But it’s more than that. The question is whether this alternative source of power, seen as important for beating climate change, is simply ‘pie in the sky’, such that Andrew Twiggy Forrest can’t make money out of it.

And like most big issues in the world today, Donald Trump could have a significant role in Twiggy’s decision.

To that point, The Australian reports that “Fortescue blamed the changes implemented under the Trump administration as the key driver of the decision to kill off the Arizona project.”

Last week we learnt that Twiggy’s Fortescue had said ‘no’ to their stated mission to spend close to $900 million on a hydrogen project in Arizona in the USA. And the planned $1 billion investment in a hydrogen plant in Gladstone, Queensland, would no longer go ahead.

The Gladstone facility, which was only opened a year ago, put 90 workers off in May. And the fact that Fortescue had received $60 million in public money to make the plant happen explains why Fortescue will pay back the money.

Mind you, there are other entrepreneurs who could’ve fought a repayment of funding based on blaming changing circumstances and Donald Trump. However, given the support of global governments for green hydrogen energy, the question is whether it’ an alternative to fossil fuels. Whether this is right or not, the stock market liked the decision, as this chart shows.

FMG

That spike in its share price (see the above chart) was linked to big exports of iron ore for the company and a decision to exit its current plan to build a US$550 million hub on the outskirts of Phoenix that would make clean hydrogen, then offer refuelling services to passing trucks.

But both Joe Biden, with reduced subsidies for green power projects, and then Donald Trump’s even less enthusiastic support for hydrogen, took away the appeal of the project that looked a goer in 2023.

Since then, the global belief that alternative sources of power, electric vehicles and related new age power developments, while seen as inevitable, look likely to take longer than anticipated.

This story on theconverstion.com website gives us a hint of why green alternatives are looking less promising for now.

While heaps of the stuff are in the earth’s crust that could power the planet for centuries, as Misha Ketchell, editor at The Conversation wrote: “Efforts to produce low-carbon (green) hydrogen from renewable electricity and carbon capture and storage technologies remain expensive.”

Clearly, as government globally come to understand their fiscal problems after rescuing the worldwide economy from a potential depression (thanks to the Coronavirus), money to rescue the planet (especially with Donald Trump hitting global trade with taxing tariffs) is in short supply.

While the greener world of energy will come, it’s going to be on a much slower train than was expected a few years ago. That’s why Twiggy is cutting his losses and paying back his taxpayer support.

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