Background: Fortescue is one of Australia’s big three iron ore miners, behind BHP and Rio Tinto. It was founded by Andrew “Twiggy” Forrest back in 2003 and has grown into a $38 billion company off the back of rocks and minerals.

What happened: Now, Fortescue has had a record-breaking year, shipping just over 198 million tonnes of iron ore in the year to June, which was up 3.5% from last year. This means they’ve smashed their previous record of 192 million tonnes in 2023. After this news, its share price jumped over 4%.

What else: But it wasn’t all shiny rocks and celebrations though, especially in Fortescue’s clean energy division. Fortescue warned that it’s going to close its two, recently announced hydrogen facilities, which will result in a $227 million pre-tax writedown. The reason? The US hydrogen subsidies aren’t making it as viable as previously expected.

What's the key learning?

💡Green dreams often need green lights from government. Government policy can make or break early-stage industries like green hydrogen. That's because governments often offer subsidies and tax incentives to get large-scale projects off the ground in those early, loss-making years.

💡For its US hydrogen project, Fortescue blamed the collapse on policy changes under the Trump administration, which rolled back green energy support. Despite the hydrogen-hype, the demand for hydrogen has actually been dropping. According to International Energy Agency data, global green hydrogen demand fell approximately 15% year-over-year in 2024.

💡The challenge for miners is that green hydrogen production is more than double the cost of dirtier gray hydrogen production. So unless the governments chip in, it's not commercially viable right now.