Victoria gears up for renewable hydrogen development

The Victorian Government is investing in the development of renewable hydrogen technology, through its Renewable Hydrogen Industry Development Plan.

The plan sets out a blueprint for how the Victorian Government will lead and support a suite of outcomes to drive the development of a renewable hydrogen sector.

Although hydrogen from renewable energy is the only type of hydrogen production within the scope of the plan, its development has been informed by and aligns with the policies, projects and initiatives which support other forms of hydrogen production in Victoria.

It takes a principles-based approach to establishing a new renewable hydrogen sector and sets out activities currently underway, which are laying the foundations, connecting the economy and leading the development of this emerging technology sector.

The focus areas for government are set out in this plan and map the pathway to establishing a thriving renewable hydrogen industry, that will:

• Create long-term jobs through new career pathways and skills clusters

• Enable the export of renewable energy

• Drive innovation

• Build Victoria’s skills and capacity in renewable hydrogen

• Reduce greenhouse gas emissions across Victoria’s industrial, energy and transport sectors

Renewable hydrogen is a rapidly advancing technology with huge potential for market demand, both in Victoria and as an export nationally and internationally. This opportunity is particularly valuable as economies around the world recover and reposition in the wake of COVID-19.

Export-ready Victoria

The Victorian Government said the state has an opportunity to become a significant exporter of hydrogen.

The Victorian Government is already demonstrating the world’s first liquified supply chain in cooperation with the Japanese Government through the Hydrogen Energy Supply Chain (HESC) pilot project, jointly funded with the Federal Government.

The supply chain pilot project will provide Victoria with first mover advantages in hydrogen supply chain development, and if commercialised, could provide shared infrastructure and skills for the renewable hydrogen industry to develop.

The National Hydrogen Strategy is looking to position Australia as one of the top three exporters of hydrogen to Asian markets and Victorian-made hydrogen has potential to significantly contribute to this goal. Victoria’s offshore-wind resources are ideally located close to potential renewable hydrogen export hubs.

The Victorian Government said enabling the export of renewable energy through hydrogen will further stimulate investment in renewable energy by enabling renewable energy operators to also trade in the gas and international energy markets – not just domestic electricity. This may also address capacity issues.

Infrastructure Victoria’s extensive renewable energy resources, history of trade and relations, established infrastructure, and experience with liquid fuel exports make Victoria an attractive exporter.

Victoria is well-positioned to export renewable hydrogen as liquid hydrogen, or using a hydrogen carrier like green ammonia, to nearby Asia-Pacific markets and beyond. The potential demand for hydrogen and green ammonia in these regions is expected to increase exponentially as countries look to transition away from carbon-intensive energy sources in response to global climate challenges.

Pre-existing and suitable deep-water ports with liquid fuel infrastructure will be essential to growing Australia’s renewable hydrogen export market. Victoria has four major deep-water ports (Melbourne, Hastings, Geelong and Portland).

Assessments made during the development of the National Hydrogen Strategy identified that the Port of Melbourne and Port of Hastings in Victoria could be well-suited for renewable hydrogen export with minimal infrastructure developments required.

Victoria’s advanced manufacturing capabilities

Globally, the nature of manufacturing is rapidly changing as it becomes increasingly characterised by complex connections across global value chains with final products often shaped by expertise, components and services from around the world.

Victoria is placed to take advantage of this trend, and renewable hydrogen has the potential to support a strong advanced manufacturing industry.

Once hydrogen supply chains are in place, and as hydrogen generation from renewables at scale becomes cost effective, the role of renewable energy to supply hydrogen for export will increase.

Partnerships, consortiums and collaborative engagements are likely to be key delivery mechanisms for renewable hydrogen products and services.

Building a well-connected supply chain network and at the same time boosting advanced manufacturing capabilities will deliver hydrogen infrastructure, componentry, products and services more efficiently and at a lower cost.