$2b hydrogen fund to target ‘flagship’ projects
Small players are the biggest losers from the federal government’s $2 billion hydrogen fund based on new proposals showing it will focus on two or three flagship projects to expand the scale of electrolyser capacity to 1000 megawatts by 2030.
As countries rush to establish “clean” hydrogen industries, Energy and Climate Change Minister Chris Bowen said he hoped the rejigged national hydrogen strategy would kickstart the sector and help meet net zero by 2050.
Mining billionaire Andrew Forrest is building a hydrogen electrolyser factory in Gladstone in Central Queensland.
The consultation paper to be released by Mr Bowen on Friday revealed the criteria for projects that are aiming to get funding from the $2 billion fund announced in the May budget.
It makes clear the priority is the funding to be used for “at least two flagship projects” which can only be fuelled by renewable sources.
Hydrogen produced from gas or coal, and with carbon capture and storage to cut emissions, are excluded from the funding.
Successful projects will be able to receive a production credit over a 10-year period to cover the commercial gap between the cost of making hydrogen and its sale price.
This will help bridge the gap with private investment to make large-scale hydrogen projects commercially viable.
“Hydrogen Headstart is a key step towards unlocking an estimated $300 billion in private investment in Australian renewable hydrogen,” Mr Bowen said.
“Working with industry experts and stakeholders to design the program means we can maximise the success of Australia’s renewable hydrogen future.”
The 1000MW of electrolyser capacity for hydrogen production targeted for 2030 under the Headstart scheme is almost 100 times the capacity that is
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