In a world-first pilot project, brown coal from the Latrobe Valley in Victoria will be converted to liquid hydrogen and exported to Japan.
The Australian and Victorian governments are providing a combined $100 million in funding to the $496 million pilot project, co-funded by a Japanese consortium — led by Kawasaki Heavy Industries (KHI) — and the Japanese Government.
The Hydrogen Energy Supply Chain (HESC) project will convert brown coal from the AGL Loy Yang mine into hydrogen at an adjacent site and then transport the gas by road to a liquefication terminal at the Port of Hastings. It will then be shipped to Japan for use predominantly in the transport industry, AGL’s website reported.
The first shipment of hydrogen, from the pilot, is scheduled for 2020-2021.
If the pilot phase is successful, the HESC Project will enter its commercial phase in the 2030s.
The world-first Hydrogen Energy Supply Chain pilot project is significant for the cutting-edge science and technology it uses, for the potential it represents for Australian industry in hydrogen production and export, and for the jobs it will create.
Speaking from the launch at Loy Yang mine, Prime Minister Malcolm Turnbull said the four-year joint federal, state and industry project would create more than 400 jobs.
“It is an initial step towards a commercial-scale hydrogen supply chain to diversify energy sources,” the PM said.
“A commercial HESC project has the potential to grow to add more than $8 billion to Australia’s economy.”
“We are not only creating a new industry and jobs in the Latrobe Valley and Port of Hastings, but building local skills in a future global hydrogen industry, estimated by the Hydrogen Council to be worth $2.5 trillion in 2050.”
The project builds on the long-standing trade relationship between Japan and Australia on energy and resource commodities.
Japan has led the world in the move to a hydrogen economy, and has identified Australia as the ideal partner for hydrogen imports to meet its future energy needs.