Australia’s green hydrogen sector has been dealt a major blow with news that Stanwell Corporation is stopping the Central Queensland Hydrogen Project.
In a brief statement, it said the project had been a “valuable international collaboration that has provided important technical and commercial knowledge to support the future large-scale commercialisation of renewable hydrogen”, without detailing the reasons for pulling out.
Funding is likely to be the main reason, as the Queensland government announced earlier this year it would not extend any further loans or grants for the project – and the broader slump in the hydrogen market will have been another factor.
The ambitious project aimed to deliver 800 tonnes of green hydrogen per day and create almost 9,000 jobs, as well as delivering billions of dollars of export revenues over a 30-year lifespan.
Australia is still officially aiming to boost its green hydrogen annual domestic production capacity to 1 million tonnes by 2030.
But as a recent report by research consultancy Wood Mackenzie warns, the country is falling behind in the global hydrogen economy despite its early leadership ambitions.
“Australia’s strategic proximity to Asian demand centres is a clear advantage,” said Joshua Ngu, Vice-Chairman for Asia-Pacific.
“But this is offset by a significantly higher levelised cost of hydrogen, driven by elevated engineering, procurement and construction and power costs. This leaves Australia trailing behind global hydrogen front-runners such as the Europe and the Middle East.”
The consultancy identifies five ways to close the competitiveness gap: by stimulating domestic demand, enhancing hydrogen production incentives, supporting blue hydrogen as a transition pathway, aligning with global certification standards, and by strengthening collaboration with global partners.
“Hydrogen is a globally traded commodity, and Australia must act quickly to establish itself as a reliable supplier,” added Ngu.
“Unless Australia ramps up policy support and market development now, it may find itself locked out of the next wave of industrial transformation.”