$300m to advance hydrogen industry
The Australian Government has issued a mandate that will see $300 million invested in Australia’s hydrogen industry via the Advancing Hydrogen Fund.
Under the mandate, the Clean Energy Finance Corporation (CEFC) will make available up to $300 million in CEFC finance to support the growth of a clean, innovative, safe and competitive Australian hydrogen industry.
One of the CEFC’s first orders of business is to seek to invest in projects included in the ARENA Renewable Hydrogen Deployment Funding Round — a $70 million grant program aiming to demonstrate the technical and commercial viability of hydrogen production at a large scale using electrolysis.
In considering investment proposals for the Advancing Hydrogen Fund, the mandate directs the CEFC to prioritise projects that promote the objectives of the National Hydrogen Strategy and that focus on one or more of the following:
- Advancing hydrogen production projects
- Developing export and domestic hydrogen supply chains, including hydrogen export industry infrastructure
- Establishing hydrogen hubs
- Other projects that assist in building domestic demand for hydrogen
CEFC CEO Ian Learmonth said, “Hydrogen has the potential to make a substantial contribution to our clean energy transition, reducing emissions across the economy while underpinning the development of an important domestic and export industry.
“Renewable hydrogen can enable the deep decarbonisation of notoriously difficult-to-abate sectors, particularly in transport and manufacturing, while accelerating the contribution of renewable energy across the economy.
“CEFC finance remains central to filling market gaps, whether driven by technology, development or commercial challenges. We are confident we can use our capital to help build investor confidence in the emerging hydrogen sector, which is an exciting extension of our investment focus.”
In line with the CEFC Act, projects seeking CEFC finance through the Advancing Hydrogen Fund are required to be commercial; to draw on renewable energy, energy efficiency and/or low-emissions technologies; and to contribute to emissions reduction.
Hydrogen is currently used mainly for ammonia production in Australia, accounting for approximately 70% of total hydrogen use nationally. The current ammonia production process is a material carbon emitter, accounting for almost 1% of total Australian greenhouse gas emissions.
“Accelerating the transition to green ammonia, produced using renewable energy, represents a sizeable abatement opportunity for Australia, with the potential to position Australia as a leading global producer and exporter of green ammonia,” Learmonth said.
“Hydrogen is an extremely versatile energy carrier which is gaining significant support worldwide as the fuel of the future.
“We see green hydrogen as offering the most credible pathway to decarbonisation for high-emitting sectors and those which lack scaleable electrification options. Together, these sectors are responsible for driving some 30% of Australia’s greenhouse gas emissions.”
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