Fortescue Future Industries has embarked on an ambitious project in Buckeye, Arizona in a significant development for the renewable energy sector. The Australian green energy giant has broken ground on a sprawling 158-acre site for its first green hydrogen facility in the United States. The project, estimated at $550 million, features an 80-megawatt electrolyzer and liquefaction system designed to produce over 11,000 tons of green hydrogen annually. This initiative was first reported by ABC15 and further detailed by The Business Journal.
Located west of State Route 85, the construction of this hydrogen hub is expected to generate approximately 2,000 jobs during its development phase and over 400 permanent positions thereafter. Notably, 40 positions will offer attractive salaries at the new facility. This boosts the local economy, particularly in a region that consumes more than 5 billion gallons of diesel each year. Production at the plant is slated to start by mid-2026.
During the groundbreaking ceremony on May 2, Fortescue’s Chairman, Andrew Forrest, highlighted the U.S. government's support for renewable energy. However, he also emphasized the challenges ahead, particularly concerning regulatory frameworks that could hinder progress. The hydrogen hub not only promises substantial economic benefits, including an estimated $59.2 million boost to Arizona’s GDP and $9.1 million annually in local and state taxes, as per the Arizona Commerce Authority, but also strengthens Arizona’s emerging reputation as a leader in sustainability and clean energy.
Despite these positives, the project's path has not been without its complications. Fortescue acquired the Buckeye site from Nikola Corp last July for $24 million, a significant markup from Nikola’s purchase price of $16.5 million the previous year. This acquisition is part of Fortescue's broader strategy to expand its green energy footprint, which includes a $35 million investment in a Detroit factory and plans for a 300-megawatt green hydrogen production facility in Centralia, Washington.
The project faces potential regulatory hurdles from the Inflation Reduction Act’s draft guidelines, which require energy production to align with consumption on an hourly basis. Forrest has criticized these guidelines as overly restrictive and misaligned with broader U.S. climate objectives.
Fortescue spokeswoman Stephanie Genco noted that the financial implications of the 45V tax credit debate are still unclear, as federal guidelines are being finalized. Meanwhile, Fortescue North America’s CEO warned that compliance with the hourly matching requirement could increase costs by up to 140% at the Buckeye facility, underscoring the tension between advancing green initiatives and navigating practical implementation challenges.
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