Canberra: Australia’s government has awarded as much as A$814mil or about US$516mil in funding to a green hydrogen project, even as global confidence in the clean-energy technology wavers.
The 1.5 gigawatt Murchison Green Hydrogen Project in Western Australia is the first to be granted funds under the Hydrogen Headstart programme, the Climate Change, Energy, the Environment and Water Department said in a statement yesterday.
The development will create about 3,600 construction jobs, plus another 600 other roles, it said.
It will produce almost two million tonnes of green ammonia a year, and will cost an estimated A$15bil.
The Hydrogen Headstart programme had shortlisted six applicants, though none of the projects are considered “bankable” – or able to meet criteria including minimum costs – after sponsors left or they were paused, project ratings agency HySights Pte Ltd said in a report.
The global hydrogen sector is struggling with cancelled projects and sluggish demand.
Three developers have announced changes to projects in recent weeks, BloombergNEF said in a report earlier this month, as the industry grapples with political uncertainty and rising project costs.
A plan by Australian miner Fortescue Ltd to become a green hydrogen heavyweight, championed by its billionaire founder Andrew Forrest, was also scaled back last year.
The Murchison project is being developed by Copenhagen Infrastructure Partners, and will use solar and wind powered by hydrogen, converting it to green ammonia for export.
Prime Minister Anthony Albanese’s Labor government had been aggressively pushing Australia to develop a clean hydrogen sector, putting in place more than US$5bil of incentives over the next decade to support the nascent industry.
The upcoming elections could threaten that, however, as the opposition coalition has been less enthusiastic on the sector’s prospects.
“This support is about unlocking that private capital to help realise our potential, not only to become a renewable energy superpower but create a future made in Australia with real jobs right now,” Minister for Climate Change and Energy Chris Bowen, said in the statement. — Bloomberg
