How much hydrogen does Australia currently produce? How much is expected to be produced in the future? How much will subsidies cost? Just how realistic are the claims of becoming a prosperous renewable energy superpower on the back of hydrogen exports? Recent government documents provide some answers to these questions and suggest that the potential of hydrogen exports is limited. [...] HYDROGEN PRODUCTION TAX INCENTIVE The Australian Government intends to incentivise the production of hydrogen through the Hydrogen Production Tax Incentive (HPTI). [...] The value of this subsidy on a per kilogram basis sits between the lower European incentives and US incentives at USD $3/kg.3 The Commonwealth Budget outlines the estimated cost of the HPTI: The Hydrogen Production Tax Incentive [will operate] from 2027–28 to 2040–41 for producers of renewable hydrogen to support the growth of a competitive hydrogen industry and Australia’s decarbonisation, at an. [...] All of this hydrogen was produced from fossil fuels.5 While there is little data on historic hydrogen production, this volume appears relatively representative of recent years and ‘business as usual’ forecasts.6 Figure 2 below compares the Australia’s current production of hydrogen with Government forecasts of 2030 and 2040 green hydrogen production under the HPTI: 5 DCCEEW (2023) State of hydroge. [...] This includes existing hydrogen use in industry, and refining…10 If the initial uses of green hydrogen will be replacing existing hydrogen use in industry, most likely ammonia production, the Commonwealth budget forecasts of production suggest Australia will not develop a hydrogen export industry before the mid 2040s.
Authors
- Pages
- 6
- Published in
- Australia
Table of Contents
- Hope and hydrogen 1 1
- Author Rod Campbell Matt Ryan Date July 2024 1
- INTRODUCTION 1
- Green hydrogen is at the heart of our vision for Australia as a prosperous self- reliant nation in a net zero future as a renewable energy superpower and as a country that makes things. 1
- Minister for Climate Change and Energy Chris Bowen. 1
- Hope and hydrogen 2 2
- Joint Australian and Japanese ministerial statement. 2
- Recent government documents provide some answers to these questions and suggest that the potential of hydrogen exports is limited. 2
- HYDROGEN PRODUCTION TAX INCENTIVE 2
- The Commonwealth Budget outlines the estimated cost of the HPTI 2
- Dividing the cost of the program by the 2 per kilo subsidy gives an estimate of the volume of hydrogen that the Government is budgeting for. This is summarized in Figure 1 below 2
- Hope and hydrogen 3 3
- Figure 1 Commonwealth Budget implied renewable hydrogen production 3
- Figure 1 shows that the Commonwealth Government expects to subsidise an average of 335000 tonnes of hydrogen production to 2033-34 after which production is expected to average 550000 tonnes per year. 3
- Figure 2 below compares the Australias current production of hydrogen with Government forecasts of 2030 and 2040 green hydrogen production under the HPTI 3
- Hope and hydrogen 4 4
- Figure 2 Australian hydrogen production 2022 actual 2030 forecast 2040 forecast 4
- Figure 2 shows that the Commonwealth forecast for green hydrogen production in 2030 is only around 70 of current fossil hydrogen use while 2040 production is just 10 greater than current levels. 4
- Hope and hydrogen 5 5
- Figure 3 Aus hydrogen production 2022 actual budgeted superpower estimate 5
- WHO WILL USE AUSTRALIAN GREEN HYDROGEN 5
- Similar sentiments are expressed by the Minerals Council of Australia 5
- Hope and hydrogen 6 6
- CONCLUSION 6
