After Australia opened a large fund of $50 million for carbon capture utilization and storage projects at the beginning of March, it put forward another ambitious spending plan. Australia’s prime minister Scott Morrison proposed $417 million to be allocated for hydrogen and carbon sequestration projects.
The money will be spent on developing new hydrogen-producing hubs and carbon capture technologies. They are expected to create more than 2,500 jobs and help Australia achieve its carbon reduction target. The Australian Government’s emissions target is to reduce GHGs to 26 – 28% below 2005 levels by 2030.
“It is essential we position Australia to succeed by investing now in the technologies that will support our industries into the future, with lower emissions energy that can support Australian jobs,” said Mr Morrison.
About $275.5 million Australian dollars would go for the development of four additional clean hydrogen hubs in regional Australia. So far, the government has committed to fund one hydrogen hub, part of its $1.9 billion investment package in future technologies to lower emissions, announced in 2020.
The country plans to explore the clean hydrogen potential so it also set out an Australia National Hydrogen Strategy. One of the key takeaways from the release of the comprehensive strategy is that Australia is seeking to establish itself as a major global player in the hydrogen market by 2030. The country aims to become a world leading supplier of hydrogen and wants to cut production costs to less than $2 Australian dollars ($1.54) per kilogram.
Carbon Capture And Storage In Australia
The rest of the 539 million Australian dollars ($417 million US dollars) would support the development of CCS/CCUS projects and hubs. Australia is already home to the largest commercial-scale carbon capture and storage facility – the Gorgon CO2 injection project at Chevron’s natural gas development at the Greater Gorgon area.
The project has sequestered more than 4 million metric tons of carbon emissions since it started operating in 2019. With a projected lifespan of 40 years, it is estimated to be the longest long-term CCS project.
The $417 million funding for hydrogen and carbon capture hubs will be presented in more detail in the government’s economic blueprint for the next fiscal year which will be made public on May 11. The spending also requires Parliament’s approval.
The investment received support from the oil and gas industry in Australia. However, the Australia Institute think tank expressed disappointment and called for bigger more ambitious climate action and targets. Other conservative politicians like Senator Matt Canavan compared Mr Morrison’s decarbonization efforts to “10-year-old boy who thinks he is superman and jumps off his parent’s roof.”
Morrison’s government shows commitment to reduce the country’s GHG emissions. The investments in leading clean technologies of the future like hydrogen and CCS aim to protect the industry from the unavoidable transition to a net zero world. It also wants to create jobs along the way and keep Australia’s leading export status in the energy sector.