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ARENA approves over AU$100 million in funding for green hydrogen

The Australian Renewable Energy Agency (ARENA) has announced that it has conditionally approved AU$103.3 million towards three commercial-scale renewable hydrogen projects, as part of its Renewable Hydrogen Deployment Funding Round. The projects will also play a significant role in supporting commercial-scale deployments of renewable hydrogen in Australia and help progress Australia’s pathway to achieving the Australian Government’s goal of ‘H2 under $2’.

Hydrogen

The Australian Renewable Energy Agency (ARENA) has conditionally approved AU$103.3 million towards three commercial-scale renewable hydrogen projects, as part of its Renewable Hydrogen Deployment Funding Round.

Last year, ARENA launched the funding round to support Australia’s first commercial-scale hydrogen projects to fast-track the development of renewable hydrogen in Australia.

The funding round called for expressions of interest from large-scale hydrogen electrolyzer projects across Australia to drive the commercialization of key component technologies and facilitate cost reductions for producing renewable hydrogen.

ARENA received 36 Expressions of Interest (EoI) from across Australia, and following an initial assessment, seven projects were shortlisted and invited to submit full applications.

We have been very impressed with the response to the round and I’d like to thank all of the companies that submitted applications. With the round stimulating interest in the sector, we can see a number of well-progressed feasibility studies and large projects emerging. Australia is well placed to become a major player as the clean hydrogen market develops, said Darren Miller, CEO of ARENA.

After an extensive assessment process, three projects were selected for funding. The three successful projects are:

  • ENGIE Renewables Australia Pty Ltd (ENGIE): ARENA will provide up to AU$42.5 million towards a 10 MW electrolyzer project to produce renewable hydrogen in a consortium with Yara Pilbara Fertilisers at the existing ammonia facility in Karratha, Western Australia (WA);
  • ATCO Australia Pty Ltd (ATCO): ARENA will provide up to AU$28.7 million towards a 10 MW electrolyzer for gas blending at ATCO’s Clean Energy Innovation Park in Warradarge, WA;
  • Australian Gas Networks Limited (AGIG): ARENA will provide up to AU$32.1 million in funding for a 10 MW electrolyzer for gas blending at AGIG’s Murray Valley Hydrogen Park in Wodonga, Victoria (VIC).

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.

We’re excited to have chosen three projects we believe will help kickstart renewable hydrogen production in Australia on a large scale. 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 decarbonize our natural gas networks, said Darren Miller.

At 10 MW each, the electrolyzers in these hydrogen plants will be among the larger thus far built in the world. To support these projects ARENA has increased the funding envelope, originally AU$70 million, by AU$33.3 million. In total, these three projects have a combined project value of AU$161 million.

The projects will also play a significant role in supporting commercial-scale deployments of renewable hydrogen in Australia and help progress Australia’s pathway to achieving the Australian Government’s goal of ‘H2 under $2’.

ENGIE, ATCO, and AGIG must now satisfy a number of development conditions and achieve financial close before funding is released. ARENA will continue to work with the companies to achieve this.

Our hydrogen industry in Australia is in its infancy, so the lessons learned from these three projects – and the entire funding round – will be important in driving our future hydrogen economy. With more than AU$100 million in funding, we’re hoping to build some of the biggest hydrogen electrolyzers in the world, with the ultimate goal of bringing down the cost of hydrogen produced using renewable energy and growing our skills and capacity to meet future global demand for hydrogen, Darren Miller said.

ARENA has been active in the clean hydrogen sector since 2016 and has already committed over AU$57 million to hydrogen projects including AU$22.1 million towards 16 R&D projects, as well as feasibility studies into large scale projects and smaller-scale demonstrations looking at renewable hydrogen production, power-to-gas (PtG), and hydrogen mobility.

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