US$515 Million Funding for Aussie Hydrogen and Ammonia Project

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Denmark's Copenhagen Infrastructure Partners (Copenhagen) has secured government backing to the tune of AU$814 million (US$515 million) for its massive Murchison Green Hydrogen project in western Australia.

The project is the first recipient of the Australian government's Hydrogen Headstart funding program, which has a AU$4 billion (US$2.5 billion) budget to back large-scale renewable hydrogen projects through competitive hydrogen production contracts. It is being developed through CIP's Energy Transition Fund I (ETF I) and is located north of the coastal town of Kalbarri. It will comprise up to 1.5 gigawatts (GW) of electrolysis and allow for ammonia production of 3,600 tonnes per day, or approximately 1.8 million tonnes annually. Operating fully off-grid, it will be powered by approximately 1.2 GW of solar photovoltaic and approximately 1.7 GW of onshore wind new-build generation, backed up by a 600-megawatt (MW)/1,200 megawatt-hour (MWh) battery energy storage system (BESS). Industrial Info is tracking four projects worth up to $1.9 billion in investment. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here for the reports.

Renewable ammonia is expected to be exported mainly to Asian markets, including Japan, the Republic of Korea, Singapore and Europe. Water for the project will come from a new desalination plant. The Headstart programme, overseen by the Australian Renewable Energy Agency (ARENA), supplies funding via production credits, meaning funding is only released once projects are fully constructed and operational. The project will have to meet key milestones before receiving funding, with payments distributed over a 10-year operating period based on production volumes.

"At the time it was announced, Hydrogen Headstart was the largest government investment in Australia's developing renewable hydrogen industry," said ARENA Chief Executive Officer Darren Miller. ARENA's support will help Australia's first large-scale projects get to financial close and deliver on Australia's promise as a provider of clean energy to decarbonise industry in Australia and globally. The Hydrogen Headstart Program commits funding to bridge the current commercial gap in the form of a production credit, meaning funding is only provided once projects are constructed and operational. CIP's Murchison project is an example of how we can leverage Australia's high quality solar and wind resources to produce low-cost renewable hydrogen and ammonia at scale, increasing export opportunities."

Karsten Uhd Plauborg, a partner at CIP, commented: "We see significant potential in green hydrogen and projects such as Murchison Green Hydrogen are key for countries and industries to take the next step within decarbonisation and achieving energy independence. We look forward to continuing to work with the government, the Nanda People and community to progress the project and deliver value for the region."

CIP is very active in the Australian renewable energy sector with a development pipeline exceeding 30 GW. This includes the country's most advanced offshore windfarm project, Star of the South, and the 240-MW/960-MWh Summerfield BESS project in the state of South Australia, where construction has just started. Industrial Info is tracking 12 projects worth almost US$9 billion in investment. Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can click here for the reports.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).