AGIG project provides boost for green hydrogen ambitions

Australia’s renewable hydrogen ambitions have received a boost with construction officially starting on a 10 MW green hydrogen project being developed on the border between New South Wales and Victoria.

October 14, 2024 David Carroll

Image: AGIG

Australian Gas Infrastructure Group (AGIG), owned by the Hong Kong-based conglomerate CK Group, has broken ground on its 10 MW Hydrogen Park Murray Valley facility being built in the Albury-Wodonga border region of New South Wales (NSW) and Victoria.

The $65 million (USD 43 million) project will utilise a 10 MW electrolyser from Chinese manufacturer Longi Hydrogen to produce 500 tonnes of green hydrogen per year for injection into Albury-Wodonga’s gas network.

Initially set to be blended into the gas networks in up to 10% volumes, the hydrogen will be supplied to about 40,000 residential, commercial and industrial customers in the region. The project is expected to come online late next year.

Acting AGIG Chief Executive Officer Cathryn McArthur said the start of construction is a positive signal about the potential for renewable gases in Australia’s energy transition.

“Importantly, this project is demonstrating the potential for this industry to have greater flexibility in how they reduce their emissions, either by using blended gas delivered through the network or by purchasing renewable gas through a certification scheme,” she said.

Supported by Australian Renewable Energy Agency, Victorian Government and Clean Energy Finance Corporation funding, the project is AGIG’s third hydrogen project, following on from its facilities in South Australia and Queensland.

AGIG wants to have 100% renewable gas, including from green hydrogen and biogas, through its network by 2050, with at least 10% renewable gas blends delivered to homes and businesses by 2030.

The start of construction of the Murray Valley facility comes after some of Australia’s biggest would-be developers of green hydrogen have in recent months cancelled projects and scaled back investment plans.

Origin, Fortescue, and Woodside have all recently rolled back or scrapped green hydrogen projects, suggesting the business case for the solution simply isn’t yet strong enough.

The announcements came as blows to the Australian government’s green hydrogen ambitions, but federal Energy Minister Chris Bowen said AGIG’s Murray Valley project represents a key step forward in the energy transition.

“The Hydrogen Park Murray Valley project represents a milestone investment in Australia’s clean energy future,” he said, noting that it will have eight times the capacity of the largest electrolyser currently operating in Australia, AGIG’s Hydrogen Park South Australia.

“Producing renewable hydrogen on this scale has never been done in Australia before, so this project is blazing a trail to scale up green hydrogen production, and that’s why we’re backing it,” he said.

The federal government intends that Australia should become a global leader in green hydrogen, identifying the zero emissions gas as key to the nation’s 21st century export prosperity.

More than $8 billion was included in its 2024-25 budget to support renewable hydrogen production, assigning $2 billion to expand the existing Hydrogen Headstart program and $6.7 billion to establish a hydrogen production tax incentive.

Bowen reaffirmed the federal ambitions with the signing last month of a $660 million deal with Germany to negotiate new green hydrogen supply chains and guarantee European buyers for Australia’s renewable hydrogen producers.

“The world needs it. We can make it. And we can ship it to our partners, or use it to make green products, chemicals, and fuels in Australia to export to the world,” Bowen said.

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