The NSW government is betting on new investments in green hydrogen to boost rural economies and help the state achieve its current goal of net zero emissions by 2050.
The state’s newly-unveiled hydrogen strategy provides up to $3 billion in incentives, including tax exemptions for green hydrogen production, plus a new hydrogen refuelling station network to support hydrogen hubs in the Illawarra and the Hunter regions.
The strategy also includes a 90 per cent exemption from electricity network charges for green hydrogen producers who connect to parts of the network with spare capacity.
The announcement was eagerly applauded by ETF Securities, which this week launched an exchange traded fund specialising in investing in the world’s leading hydrogen companies.
ETFS head of distribution Kanish Chugh said hydrogen is sometimes referred to as the “Swiss Army knife” of decarbonisation.
“The hydrogen economy is a greenfield investment opportunity, still in its early development stage.
"However, its potential applications are limitless – from making fertiliser to powering the world’s transport systems,” Mr Chugh said.
As opposed to non-green hydrogen production, green hydrogen is typically made using renewable energy sources.
Since the process only requires water, an electrolyser and the energy needed to make it run, the idea here is to meet the needs ordinarily met by existing hydrogen gas, but with a reduced carbon footprint.
NSW Premier Dominic Perrottet framed the launch of the state’s new hydrogen strategy scheme as an opportunity to drive decarbonisation and establish Australia as an economic and energy superpower in the wider region.
“Australia has an opportunity to be an energy superpower, New South Wales will lead the country with this hydrogen strategy,” Mr Perrottet said.
NSW Treasurer and energy minister Matt Kean suggested that the strategy could increase the size of the NSW economy by more than $600 million by 2030.
“Hydrogen will not only help the state halve our emissions by 2030 and get to net zero by 2050, it will create new opportunities for our heavy industry, and an economic bonanza of investment and jobs,” Mr Kean said.
He said that the strategy is forecast to more than halve the cost of green hydrogen production in NSW and promised that it would establish NSW as a destination for global investment in green hydrogen.
Meanwhile, deputy premier and minister for regional NSW Paul Toole emphasised the opportunity that the state’s hydrogen strategy represented for rural areas.
“Places like Parkes, the Illawarra, and the Upper Hunter are uniquely placed to take advantage of these opportunities, with existing supply lines, access to transport links and a skilled workforce ready to make regional NSW a leader in hydrogen technology,” he said.