Oz Plans A$70mn Investment in Hydrogen Hub (Update)
(Adds comments from Santos)
Australian government will invest A$70.2mn (US$51mn) in developing a hydrogen hub, prime minister Scott Morrison announced on September 17 without saying where the hub would be located.
The A$70.2mn hydrogen hub is part of the government’s A$1.9bn investment package over 10 years in new and emerging technologies that Morrison said would "support jobs, strengthen our economy and reduce emissions."
"The government will now focus its efforts on the next challenge: unlocking new technologies across the economy to help drive down costs, create jobs, improve reliability and reduce emissions," he said. "This will support our traditional industries – manufacturing, agriculture, transport – while positioning our economy for the future."
As part of the package, the government will also pilot carbon capture projects that will help cut emissions with a A$50mn investment in the Carbon Capture Use and Storage Development Fund.
Morrison said the government would also be helping businesses and regional communities take advantage of opportunities offered by hydrogen, electric, and bio-fuelled vehicles with a new A$74.5mn Future Fuels Fund.
Oil and gas explorer Santos said the announcement to reduce carbon emissions paved the way for large-scale carbon capture and storage (CCS), which the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC) have identified as a critical technology to achieve the world's climate goals.
"Despite the welcome growth in renewable energy, the world remains heavily reliant on oil, coal and natural gas and will continue to demand these fuels for at least the next two decades," Santos CEO Kevin Gallagher said. "Therefore, a mature debate about climate change and emissions reduction must address technologies to make these fuels cleaner and eventually zero emissions."
Gallagher said Santos hoped to be ready to take final investment decision (FID) on its 1.7mn metric tons/year Moomba CCS project by the end of this year, "so the announcement that the Clean Energy Regulator will take over methodology development to enable CCS to generate carbon credits and halve methodology development times is very welcome."
An approved methodology for CCS is needed to be in place before Santos can take a FID on Moomba CCS project because carbon credits are essential to make it stack up economically with the cost of abatement still at around A$30/ton, Gallagher said. "Our aim is to drive these costs lower with scale and experience, but the first step is to generate carbon credits to enable initial development."