Tasmania’s decommissioned Bell Bay Power Station will be redeveloped into a $1.2 billion green methanol and hydrogen plant.

The Tasmanian goverment says the partnership between ABEL Energy and Iberdrola, under the banner of Bell Bay Powerfuels, is another step towards the government’s plan for the Bell Bay Precinct to become a world-leading green methanol/hydrogen production hub.

“This is an exciting opportunity because it is a step towards the creation of a new $1.2 billion clean energy production facility, but it also provides an innovative solution to re-develop the mothballed oil-fired Bell Bay Power Station that was built in 1971,’’ Energy and Renewables Minister Guy Barnett said.

“With our world class wind resource, Tasmania is an ideal location to produce cost-competitive renewable methanol/hydrogen on a large-scale to meet this emerging export and domestic demand and become a global leader in renewable energy supply.

“Green methanol/hydrogen can be used to transition advanced manufacturing, heavy transport and energy intensive industries to renewable energy, as well as for export.”

This proposal comes after ABEL Energy successfully negotiated a deal with Hydro Tasmania as the preferred proponent for the Bell Bay site, following an EOI process launched in December 2022.

The government says it is confident that the Bell Bay Precinct will play a pivotal role in Australia’s affordable clean energy future and will foster ongoing collaboration between industry, universities, other research institutions and innovators.