EXCLUSIVE | Fortescue's US manufacturing hub will not make hydrogen electrolysers when it comes on line in 2025
Australian mining giant will produce batteries at first and 'explore' manufacture of electrolysis equipment 'down the track'
Australia’s Fortescue announced yesterday that it had secured subsidies worth more than $12.6m from the state of Michigan for its planned manufacturing hub for batteries, fast chargers and electrolysers.
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The Australian company first started producing proton-exchange membrane (PEM) electrolysers at its 2GW factory in Queensland last year.
However, Fortescue also declined to comment on whether it has any plans to sell any electrolysers produced in the US to other developers, or only use them in-house.
Fortescue has scheduled construction of its $550m Phoenix Hydrogen Hub in Arizona for the latter half of this year, for which it has already procured 80MW of alkaline electrolysers from an undisclosed supplier.
State agency the Michigan Strategic Fund has approved a $9m performance-based grant for the manufacturing hub, as well as a 15-year full property tax exemption, valued at around $1.3m.
The facility will be built on a brownfield site at 601 Piquette Avenue, with documents from the city’s Detroit Brownfield Redevelopment Authority listing the total cost of redeveloping the land at $22.3m.
As such, the Michigan Strategic Fund has also approved more than $2.37m in tax capture — ie, property tax revenues from the city's coffers earmarked for developer subsidies — to partially reimburse the cost of redeveloping the site.
Pure-play electrolyser manufacturers are already expanding into the US to serve an expected boom in green hydrogen development based on generous production tax credits and federal grants for hydrogen hubs.
Norway’s Nel announced plans for a 4GW factory, which it estimated would cost $400m, in Michigan last year, although the company’s CEO had confirmed that a final investment decision on the plant would depend on orders exceeding current capacity from its existing plants in Norway and Connecticut.
Michigan is one of the states in the Midwest Hydrogen Hub, which the federal government had allocated up to $1bn in its Regional Hydrogen Hubs programme, although neither Fortescue nor Nel were members of the consortium that had applied for these grants.