The Clean Energy Finance Corporation has welcomed the launch of the $300m Advancing Hydrogen Fund, designed to support the growth of a clean, innovative, safe and competitive Australian hydrogen industry.
An early priority will see the CEFC seek to invest in projects included in the ARENA Renewable Hydrogen Deployment Funding Round, a $70m grant program aiming to demonstrate the technical and commercial viability of hydrogen production at a large-scale using electrolysis.
CEFC CEO Ian Learmonth said: “Hydrogen has the potential to make a substantial contribution to our clean energy transition, reducing emissions across the economy while underpinning the development of an important domestic and export industry.
“Renewable hydrogen can enable the deep decarbonisation of notoriously difficult-to-abate sectors, particularly in transport and manufacturing, while accelerating the contribution of renewable energy across the economy.
“CEFC finance remains central to filling market gaps, whether driven by technology, development or commercial challenges. We are confident we can use our capital to help build investor confidence in the emerging hydrogen sector, which is an exciting extension of our investment focus.”
Through the Advancing Hydrogen Fund, the CEFC expects to provide either debt or equity finance to eligible larger-scale commercial and industrial projects, typically requiring $10m or more of CEFC capital. CEFC investments typically include co-financiers and/or equity partners where possible.
Mr Learmonth added: “Accelerating the transition to green ammonia, produced using renewable energy, represents a sizeable abatement opportunity for Australia, with the potential to position Australia as a leading global producer and exporter of green ammonia.
“Hydrogen is an extremely versatile energy carrier which is gaining significant support worldwide as the fuel of the future.
“We see green hydrogen as offering the most credible pathway to decarbonisation for high emitting sectors and those which lack scaleable electrification options. Together, these sectors are responsible for driving some 30 per cent of Australia’s greenhouse gas emissions.”
The CEFC will prioritise projects that promote the objectives of the National Hydrogen Strategy and that focus on one or more of the following:
- Advancing hydrogen production projects
- Developing export and domestic hydrogen supply chains, including hydrogen export industry infrastructure
- Establishing hydrogen hubs
- Other projects that assist in building domestic demand for hydrogen.
CEFC finance for the hydrogen sector has the potential to deliver significant benefits:
- Drive large-scale deployment of electrolyser technologies
- Catalyse the hydrogen industry
- Access to tailored finance: providing investing support to project proponents as they seek to accelerate hydrogen developments
- Support the implementation of the National Hydrogen Strategy
The ARENA Renewable Hydrogen Deployment Funding Round is receiving expressions of interest for projects which: demonstrate electrolysis and associated renewable hydrogen technologies at scale; facilitate a pathway to technical and commercial viability of renewable hydrogen in Australia and provide price discovery and transparency in relation to the current and projected economics for renewable hydrogen technologies.
Emissions reduction potential
Current hydrogen technologies represent the most credible pathway to the decarbonisation of “hard-to-abate” sectors – including those which produce emissions in the production process and/or lack scaleable electrification options. Together, these sectors are responsible for driving approximately 30 per cent of Australia’s greenhouse gas emissions.