Queensland continues to grow its reputation as an ideal location for renewable hydrogen projects following the announcement today of a partnership between government-owned CS Energy and IHI Corporation Japan. The two companies will assess the feasibility of establishing a renewable hydrogen demonstration plant next to CS Energy’s Kogan Creek Power Station on Queensland’s Western Downs.
Acting Premier and Minister for State Development convened a meeting of Queensland’s economic Ministers yesterday to discuss the future of hydrogen. He said the Government was injecting $25 million to develop the state’s hydrogen industry.
It was noted that renewable hydrogen offers the opportunity to create a new high-tech industry delivering enhanced environmental outcomes and highly skilled jobs. Positioning Queensland to benefit from the hydrogen industry is a priority for the Government. Hence, the Ministers were called to discuss how we can leverage this new industry.
The government’s commitment to develop and expand this industry is part of Queensland’s plan for economic recovery, creating jobs in new industries.
The Government’s Hydrogen Strategic Advisor also provided a briefing to Government ministers. The Minister for Renewables and Hydrogen stated that the announcement was the second hydrogen collaboration between Queensland and Japanese energy companies in the space of three months, following Stanwell Corporation’s partnership with Iwatani Corporation in November 2020.
“Queensland has a unique competitive advantage in the production of renewable hydrogen, with our proximity to Asia, established infrastructure, manufacturing capabilities, and renewable energy generation,” Mr de Brenni said.
“Our key strategic advantage in Queensland is our State-owned energy generators and ports.”
The two parties will prepare a feasibility study into the Kogan Hydrogen Demonstration Plant concept, which includes the co-location of a solar farm, battery, hydrogen electrolyser, and a hydrogen fuel cell at the Kogan Creek Power Station near Chinchilla.
The CS Energy CEO stated that the demonstration project will focus on the hydrogen electrolyser being only powered by behind-the-meter solar energy, making it one of the few truly ‘green hydrogen’ projects in Australia. The company is pursuing this project to ensure we have the technical capability to enter the hydrogen market once it becomes more commercially viable.
The project will prove up the virtual power plant, production of green hydrogen, and use of a battery to facilitate renewables. The plant may also be able to provide other services like Frequency Control Ancillary Services, which are important for grid stability, and which will be scoped as part of the joint feasibility study.
The demonstration project supports CS Energy’s revenue diversification strategy and follows the company’s involvement in QUT’s multi-party hydrogen process research and development project at Redlands.
The Australian renewable energy market is expected to record a CAGR of more than 8% during the forecast period of 2020-2025. Factors, such as supportive government policies, rapid acceptance of domestic solar energy over 2018 and 2019, and pressure to meet the power demand using renewable energy sources are expected to be the significant contributors to the growth of the market.
The declining costs of renewable technologies are becoming competitive with fossil fuel sources, and additional subsidies on renewables are driving the renewable market further. On the other hand, with the absence of any new initiatives, a decline in renewable energy investment in 2019, and limited power capacity by variable renewable energy sources, is expected to hinder the growth of the renewable market in the country.
