Australia’s fledgling green hydrogen sector and its backers have welcomed the Albanese government’s comprehensive election win, which keeps ambitions of a globally competitive export industry afloat.
A change in government would have unwound more than $10 billion in planned industry incentives over the next decade to bridge the gap to sustainable markets.
But Labor’s win means $6.7 billion in production credits for renewable hydrogen makers, $4 billion for large scale projects, and additional funding for pre-commercial technologies will stay.
“Our industry is pre-commercial, and in the absence of carbon pricing, government support is essential to reduce the commercial gap for hydrogen, grow national and regional capabilities and boost our energy system resilience and fuel security,” Hydrogen Council chief executive Fiona Simpson said.
Through the Australian Renewable Energy Agency and Labor’s Hydrogen Headstart program, $814 million has already been committed from round one to the 1,500 MW Murchison Green Hydrogen Project to be developed in Western Australia.
The project could be one of several to export green hydrogen and ammonia from the west coast to Europe, with a new study backing the feasibility of a new single point mooring solution and more renewable electricity generation to support production.
Other large scale projects around the country could also get a leg up with more than $1 billion still remaining in Hydrogen Headstart round one. Several potential projects fell over last year, but ARENA has hinted some are still in the running. A second round of the Headstart program will offer another $2 billion to large scale projects.
The program compliments the Albanese government’s flagship Future Made in Australia agenda, which will pour a further $6.7 billion into green hydrogen with production tax credits.
Due to start from 2026-27 and only applying to projects that take a final investment decision by 2030, the incentive will provide a $2 incentive per kilogram of renewable hydrogen produced for up to ten years per project.
Dr Simpson, whose industry group represents the green hydrogen supply chain from corporate investors and energy giants to local manufacturers and startups, said projects are moving forward, but that “policy certainty has been top of mind for investors and our trading partners”.
“Australians have made a clear choice over the weekend to return the Australian Labor Party to Government,” she said.
“This choice affirms key policies such as the Future Made in Australia agenda that recognises the importance of hydrogen and its role in the production of derivatives such as green ammonia and methanol, green iron and alumina.
“Hydrogen used directly for industry and transport, and products made with hydrogen will be key to decarbonising global heavy transport such as shipping and aviation, agriculture including fertilisers, and steelmaking – that all have a significant impact on the world’s carbon emissions and must be decarbonised to achieve net zero targets.”
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