Keynote address at the 2021 Australian Hydrogen Conference
ANGUS TAYLOR: Thank you for the opportunity to address you all today.
I particularly thank the Australian Hydrogen Council for organising today’s event and its CEO, Dr Fiona Simon, for her opening remarks and valuable leadership. The Council plays an important role in advancing and growing Australia’s hydrogen industry.
The Australian Government, along with the states, is making significant progress in implementing our National Hydrogen Strategy.
When you held your last conference in November last year, Australia was emerging from an extraordinary public health and economic crisis brought on by COVID-19.
As tough as 2020 was, we kicked some big goals at the height of the pandemic with the release of our Technology Investment Roadmap and the first Low Emissions Technology Statement.
Through these initiatives, we’re driving down the cost and accelerating the deployment of hydrogen and other priority low emissions technologies.
Last September, we unveiled a $1.9 billion investment package for future technologies, to support jobs, strengthen our economy and cut emissions.
And we’re building on these achievements.
We are working with the states and territories to undertake Australia’s first National Hydrogen Infrastructure Assessment, due for completion later this year.
This assessment will look at hydrogen supply chain needs such as electricity and gas networks, water supply networks, refuelling stations, roads, rail and ports.
In this year’s Budget, the Morrison Government announced further support for hydrogen development in Australia, with more than $539 million provided to establish new hydrogen and carbon capture and storage hubs. This investment will create more than 2,500 jobs.
Over $275 million of this funding will go to four additional clean hydrogen export hubs in regional Australia, as well as trials of a hydrogen certification scheme.
This will take the total number of hubs to be supported to five.
I had the honour of making this announcement with the Prime Minister at the Star Scientific facility on the Central Coast of NSW.
Star Scientific – based both here and with offices in Singapore and Europe – is a great example of Australia’s world class innovation in hydrogen.
Their catalyst technology is the type of innovative research that is critical to Australia becoming a world leader in hydrogen.
Through Australian-led research and the creation of hydrogen hubs, we will reach our goal of producing hydrogen below $2 a kilo.
We want to accelerate this process so that clean hydrogen achieves cost parity with high emitting alternatives as soon as possible.
At $2 per kilogram, hydrogen will become economically competitive with traditional alternatives.
Removing the green premium—the price difference between incumbent technologies and low or zero carbon solutions—is the key to widespread global adoption. This will mean that countries don’t have to choose between economic development and decarbonisation.
To reach that goal, we need to build demand and bring the cost of production down.
Hubs are an efficient early-stage approach to building industry scale by co-locating hydrogen producers and users.
Scale is essential to making hydrogen competitive with existing alternatives.
We will not have production at scale without the demand alongside it, providing revenue for the sector and reducing investment risk.
In addition to bringing together hydrogen users and exporters, the hubs will reduce infrastructure costs, encourage innovation, and enhance skills and training efforts.
It will allow us to build larger and more efficient supply chains that can facilitate the international supply of, and demand for, Australian hydrogen.
These regional hubs will be a win-win for Australia. It will support industry growth and create jobs.
I know you all have significant interest in participating in the hydrogen hub program.
Later this year, we will be inviting applications through a grant process. Further details will be made public in coming months.
But suffice to say that there’s no shortage of regional locations across Australia with strong potential to become hydrogen powerhouses.
We’ve already identified a number of regions that we believe fit the bill, including:
- Bell Bay in Tasmania
- The Pilbara in WA
- Gladstone in Queensland
- La Trobe Valley in Victoria
- The Eyre Peninsula in South Australia
- The Hunter Valley in NSW, and
- Darwin in the Northern Territory.
But this does not mean the program will be limited to these specific locations.
The government will consider all grants applications on their individual merits and it will be industry’s responsibility to advocate for their own preferred location.
In the Budget, the Government also announced a further $263 million for carbon capture, use and storage projects to enhance our technology-neutral approach to producing hydrogen. This funding will be critical to get hubs off the ground that utilise our abundant coal and gas resources.
Making sure new gas generation infrastructure is ready for an emerging hydrogen economy is a key focus of the Morrison Government.
We are investing $24.9 million to support hydrogen-ready capability for new gas generators, through grants for hydrogen-ready turbines or associated hydrogen supply infrastructure.
This includes $5 million in funding to ensure Energy Australia’s new 316MW Tallawarra B open cycle gas turbine in NSW is hydrogen ready.
Demonstration of hydrogen-ready turbines in Australia will prove their technical capability and enable their use internationally. It will provide a potential source of demand for Australian hydrogen.
As well as supporting hydrogen industry growth, the partial firing of hydrogen in gas turbines will also reduce Australia’s greenhouse gas emissions.
On top of this, $100 million in government funding was recently committed through the Australian Renewable Energy Agency to support three large-scale renewable hydrogen projects in Victoria and Western Australia.
These projects will enable the export of ammonia from the Pilbara and hydrogen blending in domestic gas networks through the construction of three 10MW electrolysers, which will be among the largest built in the world.
Taking into account all these new commitments, the Government is backing the Australian hydrogen industry to the tune of almost $1 billion.
However, funding will only get us so far. To be a world-leader, we also need to strengthen and grow our international partnerships.
We are collaborating with our trading and strategic partners, including Germany, Japan, Korea, Singapore, the UK and the US to deepen our trade relationships and build markets and supply chains for low-emissions technologies.
In this year’s Budget, we committed more than $565 million to back low emissions international technology partnerships and initiatives by co-funding research and demonstration projects.
Discussions with potential partners that will build on our already strong energy trade relationships are underway.
Dr Alan Finkel, the government’s Special Adviser on Low Emissions Technology, will play a lead role in brokering this collaboration.
The strength of our international approach can be seen in a number of very promising projects and initiatives we’re working on with some of our international partners.
Take our collaboration with Japan on the Hydrogen Energy Supply Chain project in the La Trobe Valley in Victoria. In March, I was pleased to visit the project site to see how liquefied hydrogen can be made from coal.
The first shipment to Kobe in Japan is expected later this year. It will mark a major milestone for Australia’s hydrogen industry.
The energy source, technologies and carbon emissions from clean hydrogen production must be transparent and verifiable if we are to participate in these international supply chains.
We want to make sure that when customers buy hydrogen in the future they can be fully informed of its production journey.
To make this happen, Australia is playing a leading role in international efforts to establish a Guarantee of Origin hydrogen certification scheme.
As I mentioned, there is a lot of activity from both industry and the Government focussed on growing the hydrogen sector.
Hydrogen—low-cost clean hydrogen—holds significant promise for the world’s energy future.
It also holds significant promise for Australians – in industry and local job creation, energy security and in practical emissions reduction opportunities.
An Australian hydrogen industry could generate more than 8,000 jobs, many in regional Australia. It could also deliver over $11 billion a year in GDP by 2050.
It is an opportunity Australia cannot miss.
Australia has what it takes to be a world leader in hydrogen, just like we did with LNG.
This Government remains resolute in its commitment to reduce emissions through technology, not taxes.
Our goal is to reach net zero emissions as soon as possible, and preferably by 2050—and we’re taking practical action to achieve that goal.
We’re taking action to harness hydrogen, the most abundant element in the universe, to power our factories, our homes, our cars and our heating at an affordable price.
With your support, we will achieve our cost parity goal for hydrogen.
Your steadfast commitment to the hydrogen cause means a lot to me and the government, and it’s great to see your membership continue to grow.