Australian steelworks aims to unite renewable energy with heavy industry

31 October 2017

Whyalla Steelworks, a major steel and rail manufacturer based in South Australia, has announced the development of 1GW renewable energy projects to power its energy intensive operations, including solar, battery storage and pumped hydro.

On Monday, clean energy company ZEN Energy approved the $700 million projects destined to power the steelworks.

The announcement took place after British billionaire Sanjeev Gupta, who owns the Whyalla Steelworks, bought 50.1 percent of ZEN Energy in September and chaired the board for the first time.

The list of approved projects comprises 200MW of solar PV, with 80MW to be located in the Whyalla Council Industrial Area and 120MW on adjacent land owned by Liberty OneSteel.

100MW of battery storage will be developed at Port Augusta and 100MW of demand response will be installed at the Whyalla Steelworks and other industrial sites in South Australia.

A 120MW pumped hydro storage facility will be developed at a disused iron ore mine pit in the Middleback Ranges.

An extra 480MW of solar will also be installed to power the expansion of industrial capacity in Whyalla and other industrial areas in the region.

Sanjeev Gupta, ZEN Energy Chairman, Liberty House Group Executive Chairman and, as of July 2017, owner of Whyalla steelworks, said: “I am delighted ZEN Energy is able to hit the ground running”.

“These first steps in SA will improve reliability and greatly reduce costs of electricity in our own steelworks at Whyalla, and provide competitive sources of power for other industrial and commercial users”.

“I believe there is a great future for energy-intensive industries in Australia. I look forward to helping build ZEN Energy to become a major player in the Australian energy transition”.

Tom Koutsantonis, Energy Minister of South Australia welcomed the announcement expressing his excitement about South Australia embracing the next generation of renewables especially in the wake of increasing electricity prices in the country.

He said: “This is another example of the market saying to South Australians and Australians that the way forward is renewable energy with storage”.

“What the monopoly owners of our privatised traditional generation assets have been doing is shutting down power stations and restricting supply to try and create scarcity so they can charge us more for the same electrons”.

“What renewable energy is doing is pouring more power into the grid, increasing competition and putting downward pressure on power prices”.

On Tuesday, Sanjeev Gupta revealed his plans not only to make Whyalla steelworks run on 100 percent renewables but also to turn his bigger Liberty OneSteel Group steel plants in Melbourne and Sydney run exclusively on green energy within the next years.

In an interview with ABC Radio National, he said: “The Whyalla steelworks do not have an enormous energy requirement. Our plants in Sydney and Melbourne are very, very heavy users and we’re hoping that all of it will be supplied by renewables”.

The Australian Coalition Government has long argued that heavy industry players cannot be powered by renewables, but Gupta attempts to prove this wrong.

“Large aluminium smelters can be powered by renewables, and Whyalla can become a clean energy park and a centre of industrial activity”.

After the completion of the first 520MW projects at Whyalla, the company expects at least 40 percent reduction of electricity costs, which it has characterised “ridiculously high”.