Image: Port of Newcastle

The Australian Renewable Energy Agency (ARENA) announced a $1.5 million funding commitment on behalf of the Australian Government to finance a feasibility study into the development of a 40 MW hydrogen hub in Port of Newcastle, New South Wales.

Port of Newcastle and Macquarie’s Green Investment Group will lead the $3 million study, which will be supported by project partners Idemitsu, Keolis Downer, Lake Macquarie, Snowy Hydro, Jemena, and Macquarie Agriculture and the University of Newcastle. It will identify a broad and comprehensive variety of potential applications for green hydrogen, including customer-led investigations into transportation, bunkering, energy production, and industrial applications such as large-scale manufacturing of renewable ammonia for domestic fertiliser use.

The joint developers, project partners, collaborators, and globally recognized specialist consultants will all contribute significant expertise to the project. The study will finally determine the ideal location within the Port for the hub, which will serve as a conduit for renewable hydrogen to move across the region and eventually export.

Additionally, the study will examine the feasibility of scaling up hydrogen production for export by leveraging the Port of Newcastle’s established local and international supply chain connections. While stage one of the project is based on a 40 MW electrolyser, the study will also investigate future phased scaling up to a 1 GW electrolyser capable of producing up to 150,000 tonnes of hydrogen per year for domestic and export purposes.

The Port of Newcastle is Australia’s largest port, handling over 4,400 ship movements and more than 160 million tonnes of cargo yearly while utilizing less than half of its channel capacity. Due to the existing industries, infrastructure, access to a deep-water port, and a highly qualified population, Newcastle is a suitable location for a hydrogen center. The Port of Newcastle’s existing export lines to Japan and Korea represent future markets for renewable hydrogen.

Since the Council of Australian Governments’ (COAG) Energy Council released Australia’s National Hydrogen Strategy in November 2019, the Australian Government has been advancing international collaborations, coordinating national efforts, and funding priority industry projects to develop a clean, innovative, safe, and competitive hydrogen industry.

The development of clean hydrogen is one of the Australian Government’s Low Emissions Technology Statement’s primary stretch goals. The stretch goal is to manufacture hydrogen for less than $2 per kilogram, or ‘H2 under 2,’ which is the price point at which hydrogen will become competitive with alternative energy sources for industry and transportation.

Additionally, ARENA recently released its revised 2021 Investment Plan, which includes the project as a key component of the strategic priority of commercializing clean hydrogen, with the goal of fostering a sustainable domestic and worldwide clean hydrogen economy.

According to ARENA CEO Darren Miller, if the feasibility study confirms the project’s viability, it might enable Newcastle to become a key player in the production of clean hydrogen.

“We’re excited to be a part of this feasibility study which presents an opportunity to accelerate the diversification of Port of Newcastle which is crucial as Australia starts its journey to net zero by 2050.

Newcastle is an ideal location for this project due to existing infrastructure and skilled workforce, both of which will be so important as we scale up. With the backing of Macquarie’s Green Investment Group, Newcastle could become a hub for the production and use of hydrogen for domestic and export opportunities for Australia.”

Through the Renewable Hydrogen Deployment Funding Round, ARENA recently granted $103 million in funding to support three 10 MW electrolyser plants. Additionally, ARENA has invested $60 million in pre-commercial operations across 36 projects since 2018, including a number of feasibility studies concentrating on smaller scale deployments with domestic end-use cases.

The feasibility study is ARENA’s second for a large-scale hydrogen manufacturing project. Stanwell already received funds to conduct a feasibility study for a planned hydrogen export market in Gladstone, Queensland.

Nedim Husomanovic

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