ARENA commits more than $100 million to clean hydrogen projects

The Australian Renewable Energy Agency (ARENA) has approved more than $100 million towards three commercial-scale renewable hydrogen projects.

ARENA will provide up to $42.5 to Engie Renewables Australia Pty Ltd (Engie)'s 10 MW electrolyser project to produce renewable hydrogen in a consortium with Yara Pilbara Fertilisers at the existing ammonia facility in Karratha, Western Australia. ARENA will also provide up to $28.7 million towards a 10 MW electrolyser for gas blending at ATCO's Clean Energy Innovation Park in Warradarge, Western Australia. In the third project, ARENA will provide up to $31.million in funding for a 10 MW electrolyser for gas blending at AGIG's Murray Valley Hydrogen Park in Wodonga, Victoria.

The funding comes from ARENA's Renewable Hydrogen Deployment Funding Round. In total, these three projects have a combined project value of $161 million, with ARENA contributing up to 103.3 million.

At 10 MW, the electrolysers in hydrogen plants will be among the largest so far built in the world, ARENA notes. In addition to supporting commercial-scale deployment of renewable hydrogen, the projects are intended to assist the government's goal of H2 under $2 - hydrogen as a fuel source at under $2/kg, which would make it competitive in price with fossil fuels.

Engie will use renewable hydrogen to produce ammonia at the Yara Pilbara Fertilisers site, while ATCO and AGIG's projects will use renewable energy to produce renewable hydrogen for gas blending into existing natural gas pipelines.

Renewable hydrogen presents an opportunity to help reduce emissions globally and locally, transform our energy system, and create a new export industry for Australia, says Darren Miller, ARENA CEO.

"We're excited to have chosen three projects we believe will help kickstart renewable hydrogen production in Australia at a large scale," Miller says. "One of the projects will see clean hydrogen used to make ammonia for export and the other two will blend clean hydrogen into our gas pipelines to help decarbonise our natural gas networks."

ARENA has been active in the clean hydrogen sector since 2016 and has already committed over $57 million to hydrogen projects including $22.1 million towards 16 R&D projects, the agency says.

ATCO and Australian Gas Infrastructure Group's (AGIG) CEIP project is "intended to establish Australia's first commercial scale green hydrogen supply chain," the companies say.

"The development of the CEIP has the dual benefit of not only contributing to the decarbonisation of the gas distribution network, it also allows us to generate the economies of scale required to expand the demand and use of renewable hydrogen as a commercially viable fuel," says Patrick Creaghan, ATCO Australia managing director and chief operating officer.

ATCO and AGIG are significant players in the Western Australia gas market, notes Ben Wilson, AGIG CEO.

"The CEIP joint venture brings together our strengths to establish a commercial hydrogen sector in the state," Wilson says. "We look forward to working with ATCO who bring with them extensive energy and hydrogen industry experience locally and internationally."

The CEIP is planned to be co-located with the 180MW Warradarge Wind Farm in Western Australia's Mid-West, which will provide the renewable electricity to power the electrolyser. Hydrogen generated will then be transported via truck to gas network injection points.

Funding will enable additional planning work to take place, with a Final Investment Decision estimated in December 2022.

ATCO is a diversified global holding corporation with assets of $22 billion, with investments in structures and logistics, energy infrastructure , transportation and commercial real estate.

AGIG formed in May 2017 and consists of AGN, Multinet Gas Networks (MGN) and Dampier to Bunbury Pipeline (DBP). AGIG owns and operates one of Australia's largest gas infrastructure businesses and operations include 40,000km of gas distribution and transmission pipelines, 60 petajoules of gas storage capacity, gas processing facilities and remote power generation.

AGIG also owns and operates Hydrogen Park South Australia, currently Australia's largest electrolyser, which will blend renewable hydrogen into its local gas distribution network and supply industrial customers via Tube Trailers. AGIG is also developing Hydrogen Park Gladstone in Queensland.

Read more: ARENAAGIGATCOAustralian Renewable Energy AgencyBen WilsonDarren MillerEngie Renewables Australia Pty LtdHydrogen Deployment Funding RoundPatrick Creaghan