Japan has announced its plan to invest $2.35 billion in a project that will help turn Australia’s coal into clean hydrogen with the help of carbon capture technology.
The project has also received the support from Australia’s federal government, as well as the Victorian government, as a means to stimulate economic growth in the region.
The investment decision in the coal to hydrogen project was made by the Japan Green Innovation Fund and will be aimed at supporting the port and liquefaction infrastructure at the Port of Hastings.
What is noteworthy about this decision is that it comes just as several Australian companies explore hydrogen opportunities in the United States in an attempt to benefit from the incentives offered by the $437 billion Inflation Reduction Act.
The same is also what, in part, is putting pressure on the Albanese government to match those incentives, especially after in 2022 it canceled $250 million worth of grants that were dedicated to supporting carbon capture and storage (CCS) projects in the fossil fuel industry.
And while the government is currently at work to revise its hydrogen strategy, Kawasaki Heavy Industries executive Yuko Fukuma shared that she has encouraged it to focus on a handful of projects instead of distributing taxpayer funds across the budding and rapidly growing hydrogen sector.
Up until today, Victoria’s Hydrogen Energy Supply Chain project has received 100$ million in government funding over the course of six years to build pilot facilities.
The investment of the Japanese government will be made in installments, as the project reaches different milestones.
“Focus on some key projects with some much more deep funding to accelerate their pathways to successfully complete and go to the commercial [phase],” Fukuma said.