Western Australia’s Labor government will inject a total $61.5 million into the state’s renewable hydrogen industry in a bid to accelerate the move towards a low-carbon future.
Premier Mark McGowan announced the initiative in the lead-up to this week’s state budget to advance a homegrown hydrogen production industry and drive local demand.
The funding will comprise a $50 million pool to stimulate demand in transport and industrial settings, and $11.5 million for the development of a renewable energy hub on a 64-square-kilometre site at Oakajee, north of Geraldton.
The greenfield site is believed to be ideal for green hydrogen production due to its wind and solar conditions and has been earmarked for a new multi-user shipping port to support export-oriented activities such as magnetite iron ore, downstream processing industries and renewable hydrogen.
Labor’s funding package delivers on an election promise to build an access road into the Oakajee industrial area and kick-start the precinct.
Mr McGowan said hydrogen offers “incredible potential” for the state and could potentially take a seat alongside iron ore and liquefied natural gas (LNG) as a major export commodity.
“Countries like Korea, Japan and China are going to need renewable energy as a carbon-free fuel source into the future and WA is ideally placed to provide it,” he said.
Renewable Hydrogen Fund
The government will also deposit another $1 million in grants to the Renewable Hydrogen Fund designed to support capital works projects and feasibility studies across WA which promote the industry’s growth.
Since its launch in 2019, the fund has made more than $10 million available for industry-led studies to harness local renewable resources, including technologies and capabilities to support the transport of renewable hydrogen.
Mr McGowan said the export of renewable hydrogen to countries which are highly dependent on imported energy supplies represents a significant economic opportunity for the state.
“[This fund] builds on our renewables potential, technical expertise and global reputation to further position Western Australia as a key player in the future energy mix,” Mr McGowan said.
“We will look at developing our domestic production capabilities and opportunities for downstream processing and ways to drive local content, so WA suppliers are in the box seat to capitalise on the potential of hydrogen.”
Perth-based Global Energy Ventures (ASX: GEV) is one of three recipients in the latest round of feasibility grants approved under the Renewable Hydrogen Fund.
The company has been awarded $300,000 to evaluate the technical and commercial feasibility of exporting green hydrogen to the Asia-Pacific utilising its proprietary compressed hydrogen shipping solution.
The study forms part of the HyEnergy project and includes joint venture partners Province Resources (ASX: PRL) and French independent power producer Total Eren.
It aims to provide the partners with sufficient confidence to warrant the selection of compressed hydrogen as the preferred export method in the next phase of project engineering.
Speaking with Small Caps, Global Energy’s chief executive officer Martin Carolan said the funding was “strong recognition” of the value to be gained from a compressed hydrogen marine supply chain.
“Support from the state government is important given that we will be pioneering the export of green hydrogen from the WA coast,” Mr Carolan said.
“This funding will make a material contribution to the completion of a feasibility study for HyEnergy, which could become one of the best hydrogen export projects by scale in the world.”
He said the study is expected to generate considerable exposure for Global Energy as it is backed by Total Eren, which is regarded as a renewable energy powerhouse.
The feasibility is due for completion in the first half of 2022.