Hydrogen is a cornerstone of the global energy transition, offering a versatile and sustainable alternative to fossil fuels. Its potential as a clean energy source is especially significant for industries and sectors that are challenging to decarbonize.
Image Credit: Sahara Prince/Shutterstock.com
In this context, Australia took a decisive step forward with the release of its National Hydrogen Strategy 2024, which aims to unlock hydrogen's vast potential as a transformative energy resource.
The strategy highlights Australia's ambitions to control its natural advantages and position itself as a global hydrogen production and export leader.
Australia’s Hydrogen History
Australia's engagement with hydrogen energy dates back several decades, with early investments in research and pilot projects during the 1990s and early 2000s. However, the global surge in interest in clean hydrogen over the past decade has brought renewed focus to its development.
The 2019 National Hydrogen Strategy marked a turning point, setting the foundation for advancing hydrogen technologies.1
Globally, countries like Japan, Germany, and South Korea have invested heavily in hydrogen as part of their decarbonization plans, creating a competitive but collaborative international environment. Australia's unique geography and climate provide it with natural advantages.
Want to save this article for later? Download it here
The nation boasts abundant solar and wind resources, ideal for producing green hydrogen through electrolysis. With its rich mineral reserves and established export infrastructure, Australia is well-positioned to become a major player in the global hydrogen economy.2
Core Elements of Australia’s National Hydrogen Strategy
Australia’s National Hydrogen Strategy 2024 presents a detailed roadmap for creating a competitive hydrogen industry globally. It highlights ambitious goals, government initiatives, and sector applications that promote decarbonization and economic growth.
Vision and Objectives
The National Hydrogen Strategy 2024 envisions Australia as a global leader in hydrogen production, distribution, and innovation. The overarching goal is to develop a clean, competitive, innovative hydrogen industry supporting Australia’s transition to net-zero emissions while driving economic growth. Central to this vision is a commitment to green hydrogen, produced using renewable energy sources and ensuring minimal environmental impact.2,3
The strategy aims to establish Australia as a preferred partner for hydrogen imports, particularly in Asia-Pacific markets. It seeks to secure a significant share of the burgeoning global hydrogen market by building strong domestic capabilities and fostering international collaboration.2,3
Production targets
A key aspect of the strategy is its ambitious production targets. By 2050, Australia aims to produce 15 million tons of hydrogen annually, with interim targets to ensure steady progress. Achieving these targets is expected to reduce national carbon emissions significantly, aiding Australia’s commitment to achieving net-zero emissions by 2050. The strategy also outlines plans for scaling renewable energy infrastructure to support these production goals.2,3
Government support and investment
The Australian government has introduced several initiatives to foster the hydrogen industry. Notable among them is the Hydrogen Production Tax Incentive, which provides financial relief to producers, reducing the cost of hydrogen generation.
The Hydrogen Headstart program further bolsters the sector by funding large-scale projects, with an emphasis on bringing production costs below $2 per kilogram—a benchmark considered vital for achieving global competitiveness.2,3
Substantial investments are being made in research and development, workforce training, and regional hydrogen hubs. These hubs aim to create integrated ecosystems for production, storage, and transportation, accelerating the adoption of hydrogen technologies across the country.2,3
Sectoral focus
The strategy identifies key sectors where hydrogen can drive decarbonization and foster innovation.
- Transport: Hydrogen is a promising clean alternative to diesel and kerosene in aviation, shipping, and heavy road transport. Efforts to build hydrogen refueling infrastructure and develop hydrogen-powered vehicles are already in motion, signaling a shift toward more sustainable transportation solutions.2,3
- Industry: In sectors like steel production and ammonia manufacturing, hydrogen can replace coal and natural gas as feedstocks, significantly reducing emissions.2,3
- Power Generation: Hydrogen's versatility makes it a promising solution for energy storage and grid stabilization, complementing renewable energy sources during periods of high demand or low generation.2,3
Hydrogen: Challenges and Opportunities
Although Australia’s hydrogen ambitions face technical and economic challenges, the strategy identifies solutions and significant opportunities for regional development and job creation. It enhances Australia's competitive position in the global energy market.
Competitive landscape
Australia faces competition from nations with similar ambitions, such as Saudi Arabia and Canada, which also have vast renewable energy resources and hydrogen-friendly policies. However, Australia's proximity to key Asian markets provides a distinct advantage.4
Technical and economic challenges in hydrogen production
Scaling hydrogen production involves overcoming several hurdles, including high initial costs, infrastructure limitations, and the need for technological advancements in electrolysis and storage.
The National Hydrogen Strategy 2024 addresses these challenges through targeted investments in innovation and infrastructure, aiming to reduce production costs and build an efficient supply chain.4
Opportunities for job creation and regional development
The hydrogen industry is expected to generate thousands of jobs, particularly in regional areas where renewable energy projects are concentrated.
Developing hydrogen hubs and export facilities will spur economic growth, creating construction, logistics, and advanced manufacturing opportunities. The strategy also highlights the potential for indigenous communities to participate in and benefit from these developments.4
Impact and Future Outlook of Hydrogen Energy in Australia
The transition to hydrogen energy represents a transformative opportunity for Australia’s energy landscape and its commitment to global climate goals. Australia can significantly reduce greenhouse gas emissions while supporting international decarbonization efforts by integrating hydrogen into key sectors, such as industry, transport, and power generation. This shift aligns with the Paris Agreement and strengthens the nation’s position as a clean energy leader.4
In the long term, hydrogen is expected to complement solar, wind, and battery technologies, enabling a cleaner, more sustainable energy system.
Economically, hydrogen production and exports could become major revenue drivers, contributing billions to the economy and creating jobs in regional areas.
With consistent policy support and innovation, Australia has the potential to lead the global hydrogen economy, fostering both environmental sustainability and economic growth in the decades ahead.4
Conclusion
Australia’s National Hydrogen Strategy 2024 marks a significant step toward unlocking hydrogen’s potential as a key player in the energy transition. Focusing on strong policy backing, technological advancement, and targeted investment, the strategy aims to position Australia as a major force in the global hydrogen market.
That said, long-term success will hinge on steady execution and adapting to shifting dynamics in the global energy landscape. If delivered effectively, the strategy could solidify Australia’s role in sustainable energy while generating lasting environmental and economic benefits.
Click here to read more about Australia's clean technology sector
References and Further Reading
- Review of the National Hydrogen Strategy. DCCEEW Australia. https://consult.dcceew.gov.au/review-of-the-national-hydrogen-strategy
- Kraal, D., Taylor, R. (2024). Hydrogen Exports and Energy Justice: The Case for Australia. Energy Justice. Sustainable Development Goals Series. Springer, Singapore. DOI:10.1007/978-981-97-6059-6_6. https://link.springer.com/chapter/10.1007/978-981-97-6059-6_6
- Expert commentary: National Hydrogen Strategy. Commonwealth Scientific and Industrial Research Organisation, Australian Government - CSIRO. https://www.csiro.au/en/news/All/News/2024/September/Expert-commentary-National-Hydrogen-Strategy
- Andeobu, L., Wibowo, S., & Grandhi, S. (2024). Renewable hydrogen for the energy transition in Australia - Current trends, challenges and future directions. International Journal of Hydrogen Energy, 87, 1207-1223. DOI:10.1016/j.ijhydene.2024.08.499. https://www.sciencedirect.com/science/article/pii/S0360319924036851
Disclaimer: The views expressed here are those of the author expressed in their private capacity and do not necessarily represent the views of AZoM.com Limited T/A AZoNetwork the owner and operator of this website. This disclaimer forms part of the Terms and conditions of use of this website.