In the wake of shunning out coal, a $36 billion project to mass-produce hydrogen from renewable power sources is underway in Australia, fueling Canberra's hopes of turning clean energy exports into a major revenue. The venture looks to churn out 1.75 million tons of hydrogen a year, enough fuel for thermal power plants equivalent to six nuclear reactors.
A private investment company affiliated with Australia's Macquarie Group along with four corporate partners is running the project, which plans to build wind turbines and photovoltaic systems generating 26,000 megawatts on 6,500 sq. km leased in the state of Western Australia. The space for the project is six times the size of Hong Kong.
Construction is scheduled to begin in 2026 after a geological survey and fundraising. Hydrogen will be converted into ammonia for transport to domestic and international markets.
They aim to meet Canberra's hydrogen production cost target of 2 Australian dollars ($1.50) per kilogram. Canberra expects the hydrogen sector to contribute as much as AU$26 billion to gross domestic product in 2050.
Australia aims to become a hydrogen powerhouse by 2030 under its National Hydrogen Strategy unveiled in November 2019, and has committed AU$570 million to support technology development and testing operations.
The country has a lot of wind and solar energy potential, and a lot of space, which make it a very good country to do investing for resources. Australia recently awarded the energy hub "Major Project Status," which recognizes its "national significance" in economic development and job creation while facilitating government approvals. This status will help in negotiations with business partners and investors as well.
The project also has received some environmental approvals from the state government.
The global exodus from
coal leaves Australia desperate to promote hydrogen. Coal and liquefied natural
gas make up one-quarter of the country's exports.
Other hydrogen projects are also underway in Australia. The biggest challenges involve securing long-term buyers and deciding the scale of production.
"Without a long-term contract, a project cannot move to construction," said an industry insider. Many countries including Japan seek to tap hydrogen as a major energy source, but they have yet to begin full-fledged efforts to build infrastructure.
It is pertinent to mention here that many countries including Japan seek to tap hydrogen as a major energy source, but they have yet to begin full-fledged efforts to build infrastructure.
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