National Hydrogen Strategy Issues Papers

Scale efficiencies over the value chain vary depending on technology, process and end use. Efficient scale is dependent on the hydrogen application, size/scale of the market, transport mechanisms and production technology. For example, the economic scale of hydrogen from solar/wind to electrolysis is heavily dependent on electrolyser pricing, location, innovations in PV efficiency, and capacity factors. Coal gasification scale is also linked to carbon capture and storage (CCS) costs and capacity.

The Issues Paper discusses the target hydrogen costs needed to impact the various markets. Scale on its own will not overcome some of the cost barriers because technological advancement is also required. Feasibility studies and cost estimating methodology can forecast scale ‘sweet spots’ and where further scale increases do not significantly improve the cost basis.

GHD suggests target scale ranges are not widely promoted without substantiation through studies and participant evaluation, as this may inadvertently discourage valuable investigation and investment to explore and substantiate the ranges.
Government-funded feasibility studies for exemplar projects that explore the impact of scale for different project and technology configurations would help accelerate progress. Proponents such as the Hydrogen Energy Supply Chain (HESC) project are examples that are sufficiently advanced to be able to suggest scale requirements for their configuration.

Ventures to export hydrogen from Australia need to be scaled around economic export transport logistics and volumes sufficient to attract long-term supply contracts. Upstream production to meet the export volume could be an agglomeration of projects at smaller scale, with lower entry hurdles and less government support.

Carbon capture and storage or use (CCS/U) has the potential to dramatically affect the hydrogen production pathways and scale either from gas, oil or coal hydrocarbons or biomass (for carbon negative fuels). Development of flagship CCS/U projects at scale will help reduce uncertainty around the cost of production from carbon based sources and help develop community understanding and acceptance of CCS/U.

GHD has significant exposure to major industry projects in the private sector and believes that, on its own, the private sector can struggle to holistically evaluate and find optimum options to leverage existing infrastructure, achieve the necessary scale and share risks. Government could support and fund feasibility studies of test case examples and lead a transition of schemes to appropriate collaborations of private enterprise. These project examples can also explore the influence of scale on viability.
Government could lead evaluation of optimum port and export configurations and provide stewardship to establish public/private enterprise to build shared export hubs. This would create an industry foundation that facilitates a much lower ‘cost of entry’ for many potential upstream hydrogen production proponents. An analogy would be a government under-writing of a gas transmission pipeline that allows many upstream gas producers to get its product to market.

Similarly, Government could establish an entity to lead the development of the first hydrogen transmission pipeline as this would also help the industry overcome another major hurdle to bulk hydrogen export, not just in terms of cost, but also in not needing to be the first to have to navigate hydrogen pipeline regulation and design and construction standards.

Furthermore, Government leadership could maintain these major infrastructure industry components for genuine multiuser access, and thereby maintain significant diversity in upstream producers, promoting healthy competition and technology development pressure. If the large scale export infrastructure is controlled by a private company, the field of hydrogen production proponents could be very limited or monopolised within the region.

GHD is aware of existing plans for CCS/CCUS that exist in the oil and gas, power and mining sectors. For example, Santos has publicised it is pursuing a project to capture CO2-e emissions from the Moomba processing plant and inject it into the Cooper Basin oil reservoirs and CTSCo has its project in the Surat Basin. In Victoria, the CarbonNet project aims to service a broader industry with CCS and is currently undertaking significant technical studies and community engagement. Other non geo-sequestration initiatives exist. Industry proponents should be encouraged with direct funding support, and through amended and new policy to progress these projects, with the dual benefit of supporting the decarbonisation of existing industry and help achieve the use of CCS/U/US in combination with hydrogen from carbon-based sources if that proves to be a viable and justified option.

Federal and State Government could agree an aligned and efficient policy, regulatory and incentive environment to encourage interstate collaboration, a stable policy environment, and a best for country outcome in establishing Australia as a leading Hydrogen exporter. This would help reduce investment uncertainty which is essential for larger scale ‘make or break’ investments.

GHD believes that many of the skills developed for and lessons learned by the oil and gas industry will be transferable to the hydrogen industry.

Incorporating an understanding of the emerging hydrogen energy industry into high school curricula is likely to generate renewed interest in STEM subjects and technical career paths. This should flow into higher uptake in tertiary education and availability of suitably qualified engineers and scientists.

Preparing the trade industry to attract and develop the required workforce and retrain experienced practitioners from allied industries should be undertaken.
GHD observed that the North American experience with CNG showed that a steady increase in offering trade skill courses and training was required to provide sufficient workers to service the new infrastructure and vehicles. Current workers and truck drivers in the utility, resource and industrial sectors can have supplemental training to be qualified to service hydrogen equipment. Minimum qualification requirements and certifications need to be established with industry to ensure sufficient skilled workforce is available to support scale-up at the right time.

There are technical standards and regulations that will need to be implemented. GHD suggests that, as far as is sensible, Australia should involve itself in collaboration with the main international standards bodies with a view to adopting the standards and mirroring regulation where they are being efficiently developed elsewhere. Failure to do this risks delay in the Australian industry and burdening it with additional cost relative to competing countries.

GHD agrees with the lessons learned from the QLD CSG to LNG industry that were documented in the Issues Paper 1. Accordingly, GHD believes that Federal and State Government has a significant role to play in preparation for and stewardship of similar new industry including:
• Anticipating and developing policy and regulatory frameworks
• Resourcing its departments to facilitate reasonable approval timeframes, cross-departmental education and awareness raising, and to have the capacity to work with the industry and community to facilitate best for country outcomes
• Anticipate potential environmental and community impacts that will require independent government assessment and or baseline data and arrange the assessments and data gathering
• Working with proponents to collaboratively help inform the public with fact-based information to facilitate community acceptance and support of the industry where justified, maintain focus on genuine issues and achieve best for country outcomes and minimise suboptimal outcomes due to ill-informed but powerful opposition or political gamesmanship
• Strongly guiding major industry proponents where it is clear that collaboration rather than competition will deliver a best for country outcome particularly around major transport infrastructure and achieving sustainable growth and avoiding over-capacity or an overheated and overpriced construction phase.

GHD refers to its comments in Section 2 suggesting Government involvement in the required large-scale export infrastructure, leaving private industry to compete and advance technology development in the upstream supply of the hydrogen and with open access to multi-supplier agglomeration export infrastructure.

To draw on an old analogy in the rail industry, highlighting the importance of a unified approach from Federal and State Government for high capital long life assets, such as hydrogen export port facilities and pipelines, Australia needs to avoid a situation where it does not have a standard rail gauge. Similar learnings could be gained from Australia’s historical development of electricity infrastructure and water resource management.

Asymmetrical growth may be observed in the hydrogen supply chain based on technology, infrastructure or end user market readiness. For example, large-scale hydrogen production may be constrained by a lack of export-ready infrastructure or absence of fully developed end user markets. Support from Government for specific supply chain sectors may be required to accelerate capacity growth across the whole supply chain.

Coal gasification (with CCS), as an example, is a relatively efficient pathway to high volume hydrogen production with limited power grid impact. This pathway could promote the early development of major export infrastructure and permit the longer term development of alternative fully renewable pathways with access to developed transport networks and offtake agreements.

With appropriate Government commercial regulation, multi-user access provisions to essential infrastructure can be maintained, allowing smaller production facilities to participate with lower investment risk profiles for participants. This helps avoid the scenario of monopolised supply chain ownership and high barriers to entry to new proponents. Consequently, it also promotes competitive market forces and potential shorter product/technology development cycles, as well as attracting international investment.

Future technology disruption risk is always present when making an investment but can cause delays if it is already in view. A major investment into large scale port and shipping infrastructure based on one of the main bulk hydrogen transport technologies, such as a liquefaction and cryogenic shipping fleet, may hesitate if a competing, but less mature technology, is showing signs that it could be commercially advantageous.

Technical and commercial readiness of some of the technologies already in view could be expected to take significant time particularly relative to the timeframes indicated by potential Asian customers. Identifying key bulk transportation technology contenders, and supporting and expediting development, should be an early high priority.

Where Australian-developed technology is showing genuine potential to be a competitor to other internationally developed transportation options, it would seem appropriate to have it progressed on a similar footing to the alternatives.
GHD considers that the CSIRO ammonia to hydrogen technology presents an exciting option for transporting bulk hydrogen internationally. The green ammonia export industry may also progress on its own to export Australian renewable energy and help decarbonise the international ammonia market and would also benefit from the focus on the ammonia to hydrogen technology.

In a more general context, GHD suggests that the following activities could and should be commenced on finalisation of the national hydrogen strategy:
• Facilitating, with private industry, well-funded comprehensive feasibility studies of exemplar combinations of competing technology and export options and with information sharing requirements to establish a shared understanding of scale and cost and should include mechanisms to confirm valid, like for like comparison between funded studies.
• Facilitate and fund feasibility studies focused on the development of shared bulk export infrastructure to identify sweet-spot port and pipeline locations, establish estimated processing tariffs to offer to prospective hydrogen producers and stimulate hydrogen production project development and to progress the Australian assessment, adoption and development of necessary technical standards and regulations.
• Review related policy and support to current proposed CCS projects in other industries with a view to encouraging proponents to invest in the project implementation and thereby supporting the decarbonisation of existing industry and potentially paving the way for CCS use in combination with hydrogen from carbon-based sources.
• Support meaningful Australian representation on international standards bodies with the objective of confirming suitability for use in the Australian context.
• Work to harmonise and align and embed State and Federal strategy and policy to reduce complications for prospective proponents and minimise investment risk due to policy change.
• Find and follow best practice in hydrogen policy and regulation with a view to mirroring and adapting for Australia.
Support of pilot facilities and other small projects to progress both technical and commercial readiness of production or transport related technologies that have shown to have merit should occur as and when justified.

The timing of larger government investment to support and stimulate major private sector investments in commercial demonstration or full scale facilities can be determined from the timelines established by the potential major export customers. Since Japan and South Korea are Australia’s target markets for export hydrogen, Australia should aim to grow hydrogen production according to their ‘Hydrogen Society’ aspirations and strategies.

Note that as Japan advances the commercialization of its hydrogen energy supply chain, it will be evaluating various options for fuel supply, including procurement from other nations like Saudi Arabia and Norway. Japan has further re-iterated its commitment to both renewable and ‘brown’ hydrogen development, although the latter is contingent upon reliable CCS/U technologies at the commercial scale. Given the extent of Australia’s fossil fuel resources, the development of CCS/U technologies at scale is therefore a major enabler for an Australian hydrogen export industry.

Measures recommended to help attract hydrogen investment to Australia include:

Attraction strategies – Government has a critical role to play in attracting industry to pilot scale developments. The development and commercialisation of a new industry via pilot scale strategies will enable both government and industry investors to understand pathways to scale.

Industry development and research support - Through subsidies and targeted grants, pilot scale projects offer diverse participants in the future industry an opportunity to establish a full supply chain. Through supported investment for the purpose of commercialising and scaling up the industry, the public and private sector can identify key commercial, regulatory, technical, environmental, and stakeholder challenges and opportunities that form barriers or provide advantage to achieve scale.

Clarity on approvals pathways - In GHD's experience, investors are looking for clear expectations around social and environmental impact mitigation strategies; and minimum approval criteria categories and thresholds. By developing clear approval pathways and expectations, the Government will provide investors with greater certainty that the investment in the pilot scale is just the first step in development through to scale when proven.

Demand side influence – The capital required at scale is significant. This means that the demonstration of bankability will hinge on the identification and establishment of a large customer base (export) combined with a domestic market (important but significantly smaller) where possible. Support on the demand side of the industry will encourage investment and enable industry to invest confidently. This is a key enabler.

Government regulatory and tax mechanisms - A balanced approach to domestic and export demand will depend on the government regulatory and tax mechanisms used to incentivise and structure domestic and export market prices.

Supporting adoption strategies - Domestic ‘hydrogen’ product adoption strategies can increase the market available. An example of this could be a transition to hydrogen-fuelled public transport and established policy and regulation with respect to domestic gas blending.

Lessons learned - Similar to the bio-fuels industry, Government support will be required to develop the hydrogen economy and in particular the green and blue hydrogen industry in Australia. We could look towards the bio-fuels industry and the lack of development over the last few years to learn what is required to develop the hydrogen industry; clear policy and support from Government at every level will be required.

To ensure an appropriate balance between export and domestic demand, while it will largely dependent on market and pricing, there will need to have a deliberate focus on initiatives such as:
• Continuing with work to study the feasibility of injection into the existing gas network
• Identifying potential demand from existing and new domestic industrial users that could transition to green hydrogen
• Retaining a percentage of production quantities for domestic use to meet agreed long term market plans that are in line with changing community expectations; and
• The prioritisation of studies into related infrastructure eg. refuelling locations for cars, heavy vehicles and trains.

Investors need assurance of strong, consistent and scalable returns.

Investment cost relief – Targeted grants/taxation schemes to encourage investment and offset economic and commercial losses experienced in the development of the sector (i.e. grant funding for feasibility studies and pilot scale projects (short term)), then taxation relief schemes for larger scale investment (long term). In GHD’s experience, an effectively structured grant program would enable a partnership approach with private sector finance that requires a return on capital scenario. As an emerging industry, this will require subsidies or some form of investment cost relief (tax relief).

Market Australia’s unique conditions – we enjoy an abundance of renewable and fossil fuel feedstocks and a comparatively stable political environment where there is bilateral support from all levels and sides of government.

Policy stability – to amplify investment in the near term, proponents will expect Australia to demonstrate how it will create long-term policy stability as well as clear technical and economic regulations specifically for hydrogen.

Underwrite demand – An alternative model would be for government to underwrite demand in the form of off-take. However this approach is still likely to result in private sector cost while the supply chain and market price is not mature and stable, (i.e cost curves need to drop significantly or government would need to guarantee artificially high demand price).

Transitional support – As scale increases and the commercial model develops, private sector finance will be seeking transitional support through Government levers including regulation, tax, planning approvals certainty and government contribution to supporting infrastructure (such as national grid, ports, roads etc.).

The domestic market will play a key role, however the level of support must be considered in the context of the international market, as the two are intrinsically linked. Access to the international market will be required to underpin investment if the ambition is to become a serious global player.

Concurrent development to support a domestic market could be supported by:

Leading position – The domestic market can be used to accelerate investment and intellectual property (IP) with the purpose of remaining ahead of the learning curve globally. Engagement or support of Government agencies and scientific research providers including CSIRO, ARENA, and other domestic supporters will increase the rate of knowledge.

Existing domestic gas injection projects to furthering knowledge – GHD has worked on or is aware of current demonstration projects for clients including Jemena and AGIG. There should be incentives to industry to accelerate these investigations and pilots.

Skills development programs – leveraging export projects to build new skills and attract new talent into the field will prepare us for a domestic market to develop – this could take the form of research institute programs at the university level and STEM program funding support programs.

Transition mechanisms – On market side, Government can influence the market size and accelerate transition to hydrogen through mandating use via strategies including hydrogen fuelled public transport fleets, gas network blend, and de-carbonisation incentives.

The optimum position for Australia would be as a low cost and reliable industry, combined with the opportunity to position overtly as a guarantee of origin producer. This would be attractive to international investment partners seeking to participate in the long-term green hydrogen supply chain, which has significant demand potential internationally.

Creating clear and stable national policies, plans and actions to stimulate development of an Australian export market for hydrogen will also facilitate heightened investment activity.

Progress the research and development – Investment in development of the domestic market can have a material role in supporting the cost competitiveness of Australia’s hydrogen exports.

By enabling the progress of pilot scale projects, the Government will support industry participants in developing and testing technology, developing IP and evolving to a mature supply chain.

Domestic policy reform, subsidies and promotion of domestic supply chains will have a positive impact on R&D investment which will move the industry along the cost curve comparatively sooner. This investment can be leveraged for scale and for the development of an export market.

Dual focus is key - It is a risk to competitiveness of both domestic and export markets if the support for the export market is limited to a point where domestically we pay for higher costs of hydrogen than international off-takers.

Provide clarity via a roadmap – Communicate that Australia is following a roadmap that progresses through the development of demonstration facilities to commercial size facilities for export to countries who have already indicated their policy settings.

Reduce cost of renewable power - Two significant cost components of producing renewable hydrogen are the cost of power for the electrolysis process and the supply chain required to support the industry. Australia has an enormous opportunity to generate renewable energy to produce large quantities of renewable hydrogen but this requires a reduction in the cost of generating renewable energy. Minimising the cost for power will increase cost competitiveness and increase viability.

Guarantee supply - Governments should be involved with hydrogen project developers during the marketing phase to guarantee supply to off-takers. This will provide more confidence to hydrogen off-takers that Australia will be a reliable and sustainable source of hydrogen.

Support cost reduction of inputs - Government should provide financial grants for the development of large commercial / utility size renewable energy systems to take advantage of economies of scale and falling equipment costs.

It is important to consider and learn lessons from two Australian precedents in the energy industry - development of the LNG industry and the CSG industry.

CSG developed a domestic market to prove the quality and reliability of delivery. It was encouraged by government mechanisms and investment in infrastructure. The LNG from CSG plants followed after the domestic market had proved the CSG supply chain.

In contrast, the LNG industry developed for export independent of an LNG market in Australia. This meant that the majority of technology, benefit and profits ended up being controlled by multinationals with limited ongoing benefit to Australians.

In any positioning with international investment partners, it will be essential to ensure that Australia fully benefits from its resources advantage as well as the investment partners. A royalty program is a viable consideration.

The main barriers for the use of domestic hydrogen in Australia are:
• the lack of necessary infrastructure
• the availability of sufficient and continuous renewable energy at a sustainable cost to grow to scale.

Strategic development for a domestic and export industry should be integrated to minimise the timeline required to grow the domestic and export industry. Therefore, a number of initiatives should be progressed simultaneously to advance the timeline and commerciality associated with developing a clean hydrogen industry for domestic and export market.

The key areas that would benefit from strategic development are:

• Develop key infrastructure to mitigate the barriers to growing a domestic industry (refer dot points above)
• Developing power technologies to provide a continuous source of renewable power
• Developing a low cost ammonia synthesiser process (to produce ammonia for export)
• Developing biogas production plants that enable biogas to be converted to hydrogen (for domestic consumption)
• Development of transmission pipelines suitable for high concentration hydrogen blends or hydrogen.
• Advance carbon capture and sequestration or use technology to take advantage of using fossil fuel or other carbon sources for producing renewable hydrogen.

This is an ambitious target given the current status of our hydrogen industry. Moving a demonstration plant from TRL 6 to TRL 9 on to full scale could take this long alone. It is envisaged that the first plant may be a fraction of the capacity required to fulfil 50% of Japan and Korea’s hydrogen requirements and Australia may need to develop several commercial plants to satisfy the requirements for Japan and Korea.

The broader issues of energy cost needs to be considered. A coordinated strategy to achieve low cost of energy to make the hydrogen would be required to consider such a target.

Maintaining the very positive collaboration and relationship with major proponents and governments from these regions is imperative to maximising Australia’s potential to achieve this target.

The key to answering this question depends on how the hydrogen is produced in a new facility.

For example, if it is produced by creating a syngas from a fossil fuel and separating out the hydrogen then in Victoria it is subject to the requirement to receive an approval from EPA Victoria under the EP Act 1970. In determining whether to grant an approval EPA considers best practice, energy efficiency, greenhouse gas emissions and climate change.

It is anticipated that any commercial scale project would need to include carbon capture and storage to gain environmental approvals and community support. If a future facility was predicted to have >200,000 tCO2-e of direct emissions, it would currently need to make a referral to determine whether an Environmental Effects Statement is required for the project or an EPBC approval.

Currently however, again in Victoria, if the hydrogen is created by electrolysis, then the facility would not require approval from EPA (unless it is not sourcing electricity from the grid and is creating its own electricity using fossil fuels on site). This is because there are no direct emissions from the facility.

Rather, it is like any other large user of electricity. There may be additional emissions created because of the hydrogen facility but these would occur at the source of the electricity generation.

The source of electricity generation may be regulated by EPA if it consumes fossil fuels to create the electricity but this regulation does not link back to the end user of the produced electricity. The EES referral/EPBC 200,000 tCO2-e trigger would not apply to the electrolysis facility as the trigger is for direct emissions not using electricity from the grid.

At a Federal level, if the hydrogen producing facility produces more than 25,000 tCO2-e of direct emission or consumes electricity equivalent to 25,000 tCO2-e, it would need to report its emissions under the National Greenhouse and Energy Regulations (NGER). The NGER, however, currently does not limit the amount of emissions from a facility.

As stated in Issues Paper 5, the safeguard mechanism (SGM) applies to facilities that emit greater than 100,000 tCO2-e. New facilities predicted to emit greater than 100,000 tCO2-e will need to apply to the Clean Energy Regulator for a baseline which will be calculated as production amount multiplied by an emission intensity for that product (currently no emission intensities have been set by DoEE).

If during operation, actual emissions exceed the baseline set then the facility would need to purchase offsets (Australian Carbon Credit Units – currently approximately $15 per tCO2-e) to bring emissions back down to the set baseline. This would only apply to hydrogen projects using fossil fuels as raw materials as the SGM only applies to direct emissions.

The SGM does apply to fossil fuel based electricity generators. However, it currently would allow for considerable amounts of electricity to be supplied to hydrogen generators before any penalty was applied.

Perceptions of Carbon Capture and Storage

The main concerns, and possibly what is driving those concerns, is an overall lack of knowledge about carbon capture utilisation and storage (CCUS) technology and impacts; and that it is perceived to be unproven technology in Australia. This perception is despite the fact that there has been significant Australian effort in developing CCUS through bodies such as the CO2CRC and Global CCS Institute.

A key point made in Issues Paper 5 is that, ‘the risks and opportunities for acceptance of hydrogen will change as awareness grows, and as people start seeing the technology emerge in their lives’. The same is true of CCUS – until it is a reality, it may be difficult to change perceptions on a community-wide level without pointing to the runs on the board.

CCUS is fundamental to enabling a commercial-scale coal-hydrogen energy supply chain pathway, unlocking enormous and immediate export opportunities for Australia, while also supporting our existing coal industries to produce clean, low emissions hydrogen – it has the opportunity to be perceived as a win-win.

When speaking to communities or observing media coverage on the issue, the typical threads around concerns involve environmental impacts associated with storage leakage fears – what impact could that have on the marine environment or other natural assets eg. for offshore CCUS, would leakage change the ocean acidity?
There may also be an ideological rejection of CCUS due to some perceiving it as ‘propping up’ the coal/fossil fuels industry, rather than perceiving it as playing an important role the in decarbonisation of various industries globally.

What can be done to address concerns?

Addressing perception issues would benefit from a three-pronged approach:
1. Develop a credible Australian plan for CCUS based on science and real-world applications and with reasonable times for technical development.
2. A community-wide educational approach using real-world success stories to demonstrate the results, value and benefits that CCS plays in terms of decarbonisation of key industries, and leveraging industry influencers to be an independent voice and act as a powerful advocate.
3. An on-the-ground locally affected (perceived or real) community approach to address localised concerns, building a long-term, trusted relationship over time.
We need to acknowledge that concerns will likely vary depending on location – the concerns of communities such as Golden Beach in Victoria may be very different to communities neighbouring the CTSCo’s Surat Basin CCS project.

Additional perceptions research to gain deeper community-wide understanding
It is tempting for industry and Government to make assumptions and conclusions about the real drivers behind CCS concerns. However, the only way to uncover awareness levels and sentiment is to survey a broad cross-section of the community with a representative sample size, supported by qualitative research such as focus groups.

We agree with CSIRO’s comment in Issues Paper 5. There is a need to better understand the community-wide concerns with additional and regular primary research to extend on the initial UQ perceptions study findings – once known, Government and industry will be in a better position to collaborate in order to develop the facts to break down the myths.

Once a solid benchmark of awareness and perceptions is understood, this should be re-tested in a longitudinal study. These findings should be shared with industry proponents, as well as Government, in order for there to be a constant shift in our collective communication and engagement approaches – this can not only be an industry proponent responsibility.

Share lessons learned from those on the ground

In addition to market research, insights can be drawn from on-the-ground, real-time community feedback being collected by CCS entities as an invaluable source of knowledge to help shape the right narrative.

Entities at the front line of community interactions on CCS, like CarbonNet in Victoria, are capturing real-time community feedback about the concerns being raised. Appropriately, their approach has been to be visible and available to locals so people can raise concerns directly with technical leaders in the field and receive immediate information to answer concerns. These insights are invaluable to the rest of the industry.

A key challenge will be to maintain this level of constant communication and engagement in the long-term.

Amplifying key messages to build support
• Amplify the narrative around CCS as being the most cost competitive pathway to hydrogen right now – that it has to be a transition/staged approach
• Build a sense of urgency around the need for change to enable to clean energy future, and CCS’s role in responding in the immediate term
• Explain why CCS is central to unlocking a decarbonised future for a variety of industries. Rather than communities or interest groups forming up an immediately negative opinion, we need them to be cheerleaders.
• Look at ways to also develop CCU opportunities for local and regional projects.

In terms of managing water scarcity concerns, the use of desalination plants or recycled water could present enormous benefits. However, there are still some technical challenges to overcome.

Management of brine generated by desalination plants is both a techno-economic and environmental challenge. Thermal brine treatment processes (e.g evaporator crystallisers) are energy intensive and present numerous operational challenges (scaling, water chemistry). The market for by-product salts is also very limited. The more crude methods of brine treatment (salt dams, deep well injection, surface water disposal etc) also present their own ecological risks on top of risks associated with social licence to operate. The existing, large scale, sea water reverse osmosis desalination plants around Australia with brine discharge to ocean provide advanced learnings and solutions for this challenge.

Modern desalination plants are reverse osmosis based, although other membrane technologies (forward osmosis, VSEP, membrane distillation) are being commercialised and may warrant consideration. Thermal distillation units (MSF, MED) are still employed, particularly in the Middle East.

The choice of desalination technology will have an impact on overall energy requirements and lifecycle cost, and lifecycle carbon emissions, for the production of hydrogen and therefore any desalination method should undergo a focused technology selection study.

Australia’s experience with existing large-scale sea water desalination provides a solid starting point for the cost and energy impact on the hydrogen industry. There are perhaps even potential synergies to be considered for hydrogen infrastructure relative to these existing assets although the required scales are different.

There is likely to be substantial community concern regarding water security for the environment, human use, and agriculture if plants are proposed in inland regions to produce hydrogen by electrolysis, particularly given the current drought and climate change projections.

There are strategic land use planning frameworks in each state that provide the opportunity for a range of industries to take place, including hydrogen production. If there are specific locations or regions that are better suited to particular types of hydrogen production (i.e. hydrogen production from fossil fuel compared to hydrolysis), a strategic review could be undertaken to determine whether there is sufficient suitably zoned land available.

Strategic land use planning could also consider the potential issues associated with cumulative impacts due to clusters of developments around nodes that are likely to be particularly attractive for development (this is an issue with other industries).

One of the key challenges is that it is a new industry in Australia and the planning and environmental approval process for large scale production facilities is yet to be tested in some jurisdictions.

This is unlike other industries, including the fossil fuel and renewable energy sector, where legislation has evolved over time and contains specific provisions to permit and control development.

Planning and environmental approval legislation could be reviewed and amended if necessary to ensure that there is a clearly defined pathway, and perhaps provide a streamlined State-led approval pathway that integrates approval requirements.

Flow charts for planning and environmental approval processes could also be developed so this is clear to proponents as well as the community. This would assist to manage community expectations by identifying key points in the process where they will have an opportunity to provide input.

As noted in Issues Paper 5, community acceptance is strongly linked to perceptions of safety, and those who know more about the properties and uses of hydrogen, are more likely to be supportive. Coupled with highlighting the economic growth and job creation possibilities, this will help with generating better understanding and acceptance.

Based on GHD’s community engagement experience on hydrogen projects in Australia, to address concerns and manage community expectations, confirming a clear set of standards (whether they be based on existing or modified for hydrogen) will be important for:
— Hydrogen storage (gas and liquefied)
— Hydrogen transportation (by road)
— Hydrogen gas pipelines
— Hydrogen Liquefaction plants
— Aspects of export terminal design and operations
— Marine shipping routes.

Major Hazard Facility legislation and the associated Safety Case methodology is now mature in all Australia States and Territories and provides a systematic approach to identifying, quantifying and managing risk. Although some hydrogen projects may not trigger MHF thresholds for Scheduled Material storage and use, the methodologies used in the Safety Case preparation are relevant, applicable, well developed and well understood.

The Regulatory Agencies with the requisite skills to review and challenge Safety Cases already exist. Government and industry could choose to apply these methodologies to demonstrate a thorough assessment and understand potential safety impacts from these developments on the community.

The quantified risk assessment approaches used in Safety Cases would enable comparisons of the new hydrogen activities with many other common hazardous activities with which the public is already familiar.

These data and analogies could form a powerful, fact-based community information program and help avert misinformation and misunderstandings occurring that can be difficult to reverse.

GHD foresees a potential challenge is that the above information may emerge too late in the development of the new hydrogen Industry as the requirement for a Safety Case Submission only occurs at the advanced stages of the project execution. Furthermore, many of the smaller pilot and developmental projects may not trigger the MHF Scheduled Material thresholds. Therefore, it is suggested that the national hydrogen strategy should include for these risk assessment activities to be undertaken early in the project phase to help inform policy and the community. This could be achieved, for example, by undertaking the necessary risk quantification for exemplar project configurations.

As highlighted by Hydrogen Mobility Australia in its March submission, if a majority of the environmental and safety aspects associated with the production, distribution, and use of hydrogen can, in fact, be effectively managed through existing regulations, codes and standards, it is of upmost importance that communities are aware of this fact.

Breaking down the fears and normalising hydrogen

Normalising hydrogen applications in our everyday lives could help achieve a shift in safety fears over time. GHD is aware of technology advancements such as work by the University of NSW who developed a hydrogen-fuelled electric bicycle and a domestic-scale BBQ – these small-scale applications could help bring hydrogen applications closer to reality.

GHD has worked with government and industry clients to engage regional and rural communities and key agency stakeholders for many years, including in the context of emerging industries, such as the CSG industry.

Key lessons learned to inform the best ways of engaging diverse communities in regional and remote locations include:

Engage the Council: Early involvement by the Local Council in shaping the right approach to engaging their communities is essential – they are a critical voice and have a deep understanding of their community

Acknowledge the diversity of communities: Understanding and acknowledging the differences between each community is key – each will have their own wants and needs in terms of aspirations for their local area – knowing this helps determine what topics or issues are of upmost importance to them and what they will expect to be informed and engaged about

Foster the support of local community opinion leaders as advocates: Regional and remote communities will typically have key opinion leaders/ influencers whom often wear a number of hats eg football club president, fourth generation farmer etc – these people become a primary stakeholder to identify and engage with early and often

Media: The Local newspaper is still a very important source of information – knowing the editor and journalists personally helps to ensure the project team is able to communicate important updates through this platform

Be part of the fabric of that community: Being present and on the ground to develop trust as part of the local community is crucial. Set up a shop in the main street – be part of the fabric of that town

Build trusted relationships: Face-to-face briefings with landholders will be more meaningful and gain better traction in terms of building trust.

Provide independent and scientifically based factual support: Communities are reassured when they can see that key safety and environmental information is not tainted with a potential conflict of interest and when it is delivered in an understandable and relatable form. GHD provided additional suggestions related to this in its answer to Question 6 above.

Established community engagement and sustainability models

GHD strongly agrees that creating the right framework from the very beginning gives clarity and certainty in terms of what to expect from an emerging hydrogen industry – for the governments funding the projects, for surrounding communities, and for the future industry proponents.

There are a range of established industry best-practice infrastructure sustainability assessment models and community engagement principles that should be leveraged in the development of an overarching industry code of conduct.

International Association of Public Participation (IAP2): Community engagement practitioners, including GHD, will often develop fit-for-purpose engagement approaches using well-known and widely accepted models like the International Association of Public Participation (IAP2) engagement spectrum. The spectrum provides guidance for the extent to which the public should participate in shaping aspects of project design and implementation, and the appropriate engagement tools.

Infrastructure Sustainability Council of Australia (ISCA): ISCA has an Infrastructure Sustainability (IS) Rating scheme that facilitates the ratings of infrastructure projects and assets. The IS Rating scheme is Australia and New Zealand's only rating system for evaluating sustainability across design, construction and operation of infrastructure. IS evaluates the sustainability performance of the quadruple bottom line (Governance, Economic, Environmental and Social) of infrastructure development. This rating scheme could be adopted by industry proponents in order for a proposed project to be assessed on its level of sustainability performance; and provide benchmarks against which to measure each project. This could provide comfort to communities expecting to be impacted by projects in their region.

Developing a hydrogen industry Code of Conduct

GHD has been actively involved in facilitating purposeful and mutually-beneficial community engagement outcomes for over 20 years. In our experience, there is usually inevitable teething problems when industry proponents are unclear about the expectation of their obligations to the communities in which they operate.

As such, GHD believe there are substantial advantages in government leading the way with a code of conduct developed in close collaboration with all levels of government, industry, and the professional infrastructure consulting firms who will inevitably be working on-the-ground and acting as the project ambassadors/representatives.
Finding the right balance will be important – guidelines need to be clear enough to understand the expectation without being too prescriptive and deterring investment.

Engagement principles in a code of conduct should cover topics such as:
• Engaging with Indigenous communities
• Level of public participation - the level of community engagement depending on the phase of work (ie Approvals, Planning, Site Selection, Design, Construction Methods, Operational phase)
• Land access obligations
• Complaints management and escalation procedures
• Decommissioning expectations and legacies
• Local industry participation obligations – local employment and suppliers.

Further governance structures would be required where hydrogen production facilities use fossil fuels as the energy source for the hydrogen production, to ensure lifecycle emissions are positively reduced as a result of hydrogen produced.

This could be determined by undertaking a lifecycle analysis of the tCO2-e produced per kg of hydrogen gas produced, and potentially setting limits on the production of tCO2-e per kg of hydrogen gas produced. This would further incentivise emission reduction options like carbon capture and storage (CCS). Where hydrogen gas is produced from renewable electricity in electrolysis, this issue is reduced.

Additionally, undertakings from project proponents to purchase Australian Carbon Credit Units (ACCUs) or MWh of renewable energy could be allowed as a means of offsetting the emissions, if fossil fuels are used as the energy source, or while CCS facilities are being developed.

Standards for the requirements for carbon, capture and storage facilities would also needed to be developed to support the use of CCS in these sorts of situation.
It would be advantageous if any rules of these kind where developed on a national level to reduce regulatory risk for project proponents.

If a lifecycle analysis approach was proposed, a standardised method to calculating the emissions should be developed. This will ensure consistency between projects. This should be based on the ISO 14040 and ISO 14044 standards. A similar approach has been developed for bioenergy projects, led by the Australian Renewable Energy Agency.

As an emerging industry, we have the important opportunity to collaborate with governments, project proponents, research institutes and most importantly, communities, to get it right from the very beginning.

Basing our approaches on lessons from oil and gas, mining and other renewable energy sectors, as well as by genuinely acknowledging community concerns of hydrogen project impacts, and working hard to address them in practical and tangible ways, will be key to us developing a sustainable and thriving export market.

Specific approaches and methods which should be considered in order to establish and maintain community support include:

• Explaining why; not just what is happening – bring people on the journey around the pros and cons of transitioning to a clean hydrogen energy future
• Ensure the local benefits are identified and communicated – economic growth, jobs for locals, new skills
• Engage on the solutions – site selection, supporting infrastructure needs, waste and water resources, local impacts during construction
• Engage communities on their preferred engagement and communication channels – tailor those approaches to each community as they will usually have different needs depending on the local context eg current mining town, in need of economic growth, environmentally-sensitive area, agricultural communities
• Utilise Community Reference Groups appropriately – make them purposeful, have a clear Memorandum of Understanding in place for members to contribute in a meaningful way and avoid wasting people’s time
• Utilise Information Sessions carefully – ensure people have access to the right experts and information at the sessions
• Measure the social impacts and social benefit outcomes in a transparent way and report back to communities often
• Be upfront about what happens at the point of decommission – will there by ongoing jobs.

Issues Paper 6 makes it clear that the main Australian gas distribution companies are already involved in identifying suitability and they are best placed to respond to this.
For global comparison, GHD is observing that in the UK, the current thinking is most of the existing low pressure gas networks would be suitable to operate with a blend of up to 20% hydrogen.

Most of the older gas networks used to operate with ‘Towns Gas’ which was approximately 50% hydrogen. This theory is currently being tested at scale at Keele University in Staffordshire , UK (Hydeploy Project) and this is expected to reach conclusions by Summer 2020. In parallel, other much larger scale trials are being planned in detail. For higher blends and even 100% hydrogen, the work to date in the UK suggests that polyethylene pipe networks are ‘hydrogen ready’. However, testing facilities have been set up to test the impact on valves, metal fittings, short sections of older iron mains and other ancillary equipment. These tests are ongoing and no firm conclusions have been reached. The UK’s ‘Hy4Heat’ project has been looking at the practical and safety implications of hydrogen including the safety of domestic fittings and pipework. Again, this work is ongoing, but the general feedback is that there are no unsurmountable problems so far and in some respects hydrogen is safer than methane due to the way it easily disperses.

SGN (Scottish Gas Networks) are planning to be the first in the UK to implement a 100% hydrogen trial (H100 project) in a location in the Fife region of Scotland. In developing this project, they are working closely with the other UK gas companies.
The higher pressure gas networks have to be looked at separately as these mains tend to be steel and were designed for use with Methane in the UK. However, there are steel hydrogen pipelines in the UK which have operated for decades, as there are in Norway. It is believed the work being undertaken in the UK by IGEM (Institute of Gas Engineers and Managers) looking at the issue for the UK is forming a view that it will be possible to distribute hydrogen via the existing high pressure gas network as they believe that the risk of hydrogen cracking can be managed. This is an ongoing piece of work.

Towns that are currently operated in ‘island’ mode with reticulation systems from centralised LPG storage could provide lower cost trial options. For a larger scale investment including hydrogen transmission pipelines, a trial similar to the Victorian Regional Gas Infrastructure program that commenced in 2011 could be undertaken.

The simple approach is for it to be installed as part of a new housing development that is also near an industrial user of hydrogen or an injection point into the gas system. The industrial load or pipeline injection would help smooth out production and demand and the residents would have agreed to be part of the trial as part of arranging to live in the new development.

The other work to develop domestic appliances and boilers etc which can operate on 100% hydrogen would need to be sufficiently advanced.

AS 4564 Specification for general purpose natural gas is currently silent with regard to hydrogen and requires modification for inclusion of hydrogen as part of the composition. Any changes in AS 4564 would require associated changes in standards covering the assets that would convey gas complying with AS 4564.

Australia is looking to develop standards for hydrogen production, transport and storage. Various international standards have been or are under development for various aspects already; but to GHD’s knowledge, none of these have been adopted in Australia to date.

For gas networks, AS 4645 and AS 2885 would be expected to be readily modified to enable these standards to cover hydrogen levels allowed under changes to AS 4564. It is common practice in other jurisdictions to have pipeline standards that cover multiple fluid types. Given the likely outcome that existing gas networks may transport gas with hydrogen, it would be efficient to continue to use the same standards as currently used. It is noted that the standards used are asset lifecycle standards, and therefore they not only relate to the design and construction, but also operation and safe management of the gas networks.

If the Australian standards used for gas networks are modified, it would be logical to modify the corresponding primary regulations that govern the safe operations of the gas networks to enable hydrogen levels that are permitted under any changes of AS 4564.

Given the above, it would be reasonable to include purpose built 100% hydrogen gas networks within the scope of the existing standards and regulations.

As highlighted in the response to Issues Paper 5, the Government will play a central role in addressing the concerns and fears of communities, particularly for how the industry will manage risks around hydrogen safety and environmental impacts including water.

As demonstrated from the active opposition surrounding the CSG industry, not taking a proactive approach to providing consistent, timely and accurate information to communities, can lead to significant issues arising with sub-optimal results for both communities and the industry.

Government and industry has an ideal opportunity to be on the front foot with education programs that are tailored to addressing what communities are telling us are their greatest issues. This, coupled with genuine, early and purposeful community engagement starting from the very early stages of any hydrogen-related infrastructure project will help build the type of relationships that fosters trust and lead to community awareness and acceptance.

Communities want to see a united front. Government can work with proponents to collaboratively help inform and influence the public with fact based information but it must be a partnership where the narrative and messages from Government and industry supports and complements the other, and ultimately, provides consistent information to communities to avoid confusion or lack of cohesion.

As noted in the response to Issues Paper 5, achieving small-scale demonstrations early that involve consumers and communities adopting hydrogen (buses, cars, homes etc) will provide tangible proof of suitability to broader society.

GHD suggests the following inclusions into the 2020-2022 phase:

• Using quantified risk assessment methodologies that have been developed and matured for MHF Safety Cases to explore risk exposure changes for hydrogen blends up to 100%. This will help inform implementation strategies. These data and developed analogies could form part of a powerful, fact based community information program and help avert misinformation and misunderstandings occurring that can be difficult to reverse.

Refer to GHD’s response to Paper 5 Question 6 for further detail.

The quantified risk assessment will also identify key areas that may require exploration with practical testing to further develop the industry’s understanding of the risks.
• Identify and implement the necessary skills and training programs required for the early phase
• Develop a roadmap for managing metering impacts as composition and fluid properties change
• Identify impacts on leak detection systems.

The International Energy Agency estimates that the global iron and steel industry accounts for almost 7% of global CO2–e emissions. Therefore, a change to this industry could make a large impact on carbon emissions.

Carbon capture and sequestration in the steel industry appears to be a better solution than in power generation, but the potential carbon emissions reduction is still estimated to be limited to approximately 50% of total emissions; due to small and diffused emission sources, lack of space for capture installations, and other issues. Storage-related issues also remain unresolved in many cases. In addition, CCS comes with few co-benefits.

Outside of coupling CCS with existing processes, the only viable way of decarbonising heavy industry is to embark on a systemic change across the full value chain. In the case of steel manufacturing in particular, the following has been implemented or is in the process of being implemented.

The steel industry has made immense efforts to increase their energy efficiency, so that producing one tonne of steel today requires 40% of the energy required in 1960. Replacing less efficient blast furnaces with more efficient ones makes a large difference to carbon emissions from steel making. However, this improvement is unlikely to be repeated with the current steel making process, and more emissions reductions from increased energy efficiency is unlikely.

Recycling of steel also makes a material difference to carbon emissions from the steel industry. A substantial amount of steel is already recycled, with more targeted, as steel is a highly recyclable material. However, for steel recycling to make a large impact on carbon emissions from this industry, energy from renewable sources is required during recycling.

The coal used in steel making could be replaced with bio-carbon, although given the volume of coal required by the steel industry, sources like wood for bio-carbon that are fully environmentally sustainable may not always be practicable.

Utilising hydrogen for the direct reduction of iron ore, combined with an electric arc furnace is currently one of the most promising routes for decarbonisation of the steel industry. The hydrogen would have to be ‘green’; that is produced from electrolysis of water by use of renewable electricity.

Other methods to extract iron from iron ore are under investigation, but these are generally still in the very early stages of development. Commercialisation of new, low carbon technology in the steel industry is likely to take many years. There are significant barriers to new technology adoption. Due to the large number of steel-making facilities around the world and large capital investment already committed in these facilities, change in the steel industry is expected to be slow.

As noted in Issues Paper 9, hydrogen presents an opportunity for Australian industry to reduce emissions across a number of sectors. There are, however, a few additional sources of heat that could be utilised in the industry. It is likely that a combination of hydrogen and these other sources will ultimately lead to decarbonisation of industrial heat processes.

These other sources include the following:

• Heat pumps and renewable power could be used in the electrification of heating systems; however, there are several issues associated with the use of such systems. Heat pumps cannot provide medium to high temperature heating, while electrical heaters cannot simply replace gas-fired or fuel oil systems. This is in particular true for gas processing plants that require large heat transfer areas for heat exchange equipment. The unit costs associated with electrical heating are higher than for fossil fuel heating systems, but this is offset by higher heating efficiency, zero emissions at the point of use and small footprints.

• Biogas appears to be a favoured source for industrial heat supply. It is generally readily available, does not require major reconfiguration of existing systems utilising for example natural gas infrastructure and does not have geographic limitations for producing energy.

• Solar thermal may also be considered. While this is probably one of the more expensive energy sources at present, costs could come down significantly over time and use, as has happened in the solar PV industry. It could therefore become a real contender in the near future.

• Biomass is another source of energy that could be utilised for industrial heat; however, the users typically tend to need to be close to the sources of biomass to make this a viable option. GHD is however aware of potential projects considering mass export of biomass as fuel.

Large industrial users of gas (for example natural gas or coal seam gas) demand reliability of supply, at a price point that is sustainable over medium and long-term commercial agreements. The importance of consistency in composition and heating value can be equally important for commercial process plants. A hydrogen supply network should not materially change the operability of an industrial facility or its risk profile.

CSIRO and others have targeted Gladstone for demonstration of hydrogen technologies as a location which is well-suited with respect to accessible energy resources, already has thriving industrial and industrial port activity and is geographically close to potentially major hydrogen markets (Japan specifically). The CTSCo CCS project could potentially be linked to this Gladstone focused initiative with a CO2 pipeline.

Geologically prospective areas for carbon sequestration include the North West Shelf, where the Gorgon Project is located, and Bass Strait. The Gorgon project will store captured carbon in the Dupuy formation beneath Barrow Island. Chevron recently applied for a licence to operate the carbon sequestration portion of the project; once implemented it will be clear how successful this sequestration installation could be. The Cooper Basin may prove to be another suitable location. Distances from industrial centres are a challenge.

Other carbon sequestration methods include (1) soil sequestration, (2) forest and other vegetation sequestration, (3) ocean sequestration and (4) mineral carbonation. Of these, ocean sequestration and mineral carbonation are the most bound to specific locations, while the first two could be undertaken in various locations around Australia.

Hydrogen can help tackle various critical energy challenges, as it offers ways to decarbonise a range of sectors where it is difficult to meaningfully reduce emissions any other way – like long-haul transport, chemicals, and iron and steel.

A large number of oil and gas firms are investigating how they can add renewables to its production portfolio and supply chain.

Many existing sites already use hydrogen. The overall mass and energy balance of the process would be significantly affected for sites using reformers to generate the hydrogen where as those receiving hydrogen deliveries or generating hydrogen using electrolysers should be able to make the transition more easily.

The applications of hydrogen in industry are diverse and may be broadly split into the following areas:
• Fuel production: product upgrading of oils and intermediary fuels in both conventional and bio refineries
• Synthesis agent for the production of ammonia and ammonia based value chains. These include fertilisers, explosives and a number of intermediary commodity chemicals such as urea and methanol.
• Power Plants: Hydrogen is used a cooling agent for large turbo-generators.
• Manufacturing: Hydrogen is used in a variety of industrial sub-sectors as a reagent, primarily because of its reducing capability. These include glass making, food and beverage production, pharmaceuticals and electronics.

In addition, hydrogen is one of the options for storing energy from renewables.
Hydrogen used as energy storage can contribute to the resilience of our major electricity systems in Australia. Long-term energy storage in micro-grid sites, such as remote mine sites could benefit.

To understand conversion issues, the principal differences in hydrogen versus, for example natural gas, must be understood. The properties of low specific volume, high heating value, high flame speed and temperature, low flame visibility, low molecular weight and low (volumetric) energy density would all contribute to significant changes for a conversion plan.

The molecular properties of hydrogen require specific strategies for the mitigation of risk related to hydrogen embrittlement and leakage, which impacts design and construction of pressure vessels and process piping. Collectively these properties materially affect the way in which safety should be managed on an industrial site.
The oil and gas industry is in the fortunate position where safety and design standards are already in place which can serve to a large extent in a hydrogen industry.

The Toyota Ecopark Hydrogen Demonstration Project is a good example of how a decommissioned site can be put to good use for development of the hydrogen industry. This site used to be a car manufacturing facility, and is now utilised to produce green hydrogen and test storage methods and automobile refuelling. There are more such unused industrial sites around Australia (for example aluminium refineries) that could be put to good use to advance the hydrogen industry through test and demonstration work.

There are currently no Australian Standards that deal specifically with hydrogen safety regulation and handling.

The International Organization for Standardisation (ISO) body has developed some critical standards that cover various aspects of potential hydrogen supply chains including: basic hydrogen safety (ISO15916), water electrolysis for industrial application (ISO 22734), fuelling stations (ISO 19880), PSA systems for hydrogen purification (ISO 19883) , fuel quality (ISO 14867) and gaseous hydrogen storage (19884) amongst others. The ISO body continues to refine and develop new standards as the industry matures.

It is understood that Standards Australia is engaging the ISO body to request membership for the hydrogen technologies technical committee (ISO/TC 97).

Many of the major international oil refiners could be expected to have mature company standards for hydrogen. Experienced engineering and operating companies, especially ones already in the oil and gas, and in particular the CSG and LNG industry, can assist to develop these standards required for hydrogen production, transport, storage and utilisation.

A clear, stable policy that puts a price on CO2-e emissions linked to Australia’s international commitments for emissions reductions in the Paris agreement would provide a firmer foundation to allow industry to start modelling the benefit of transitioning to hydrogen as a fuel source.

The Safeguard Mechanism, which is part of the current National Greenhouse and Energy Reporting and Emissions Reduction Fund legislation, could be used for this purpose if it were to be amended to result in tighter caps in direct scope 1 emissions at a facility level.

Clear policy agreed at a State and Federal level, for the decarbonisation of the electricity sector would lead to greater incentive for the further growth in the use of renewable energy – and potential use of carbon capture and storage for fossil fuel sources, in the generation of electricity. This is clearly required to ensure that our economy wide targets for the emissions reduction under the Paris agreement are met at a reasonable cost.

The support of State Governments is important as is demonstrated by the Victorian Hydrogen Investment Program, the Queensland Government, and now the Western Australian Government industry development fund, which is to be implemented soon.
While Australia has a highly skilled workforce, there is still a gap in skills when it comes to the hydrogen industry. The government could assist to provide a framework for additional education and research and development in the hydrogen industry.