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Australia's hydrogen industry celebrates production milestone

12 March 2021

Joint media release with Minister for Resources, Water and Northern Australia Keith Pitt

A world-first demonstration of an international hydrogen energy supply chain commenced operations today in Australia.

The start of Hydrogen Energy Supply Chain (HESC) operations in the Latrobe Valley, Victoria marks an important day for Australia’s hydrogen industry. The HESC project will produce hydrogen using coal from Victoria’s Latrobe Valley, with the liquefied hydrogen to be exported to Kobe in Japan.

This world leading project is an important step in developing Australia’s hydrogen industry, which is estimated could generate more than 8,000 jobs, many in regional Australia, and over $11 billion a year in GDP by 2050.

The HESC operations are part of a significant joint collaboration between industry and the Australian, Victorian and Japanese governments.  

Today, the Minister for Energy and Emissions Reduction Angus Taylor joined key partners in the Latrobe Valley to mark the commencement of operations, including with the Ambassador of Japan, His Excellency Mr Shingo Yamagami.

Minister Taylor said the start of operations for the HESC project was a milestone for Australia’s hydrogen industry.

“Our major international trading partners like Japan are very excited about Australia’s hydrogen prospects,” Minister Taylor said.

“This project is a great example of how regional Australia can play a key role in developing Australia’s hydrogen future on the world stage, with investment and job opportunities to flow through to communities. This is even more important as we strengthen our economy post-COVID 19.

“This HESC project milestone demonstrates the value of Australia’s technology-led approach to reducing emissions and the leading role hydrogen could play in our future. Real projects like this show our approach is working.”

Minister for Resources, Water and Northern Australia Keith Pitt said the HESC pilot project could help secure a long term future for Latrobe Valley coal reserves.

“The HESC pilot aims to uses brown coal with carbon capture and storage technology to produce clean hydrogen, which can then be used to power  much of Japan’s energy needs along with Australia and the rest of world,” Minister Pitt said.

“Australia has been working with our international partners to build a global hydrogen industry. Our strong and historic relationship with Japan helped build our iron ore and LNG industries and now we are cooperating with Japan on the HESC Project.

“We are also actively working with a number of countries on hydrogen, including Germany, Taiwan, Singapore and Korea.

“A commercial-scale HESC project could produce up to 225,000 tonnes of clean hydrogen per year with carbon capture and storage. It’s a great example of Australian resources supporting new low emissions energy production.”

The Federal and Victorian Governments have both made $50 million commitments to the $500 million HESC project. 

Media contacts:

Minister Taylor's office 02 6277 7120

Minister Pitt's office 02 6277 7180