Australia: Coal, Iron Ore, LNG… Hydrogen?

Last Updated: 9 September 2019
Article by David Harley and Jack Brumpton

In brief

  • Hydrogen offers a solution to the global decarbonization challenge, as well as a significant new energy export opportunity.
  • Governments and the private sector in Australia and New Zealand are showing renewed interest in the hydrogen industry. 
  • 2019 and 2020 will be key years in the development of the industry, with national strategies being developed and demonstration projects underway.

Why hydrogen's time has come

Hydrogen can be combusted for heat and motion (like natural gas) or oxidized by fuel cells for electricity to perform a variety of functions in power generation, transportation, heating and industrial processes. Importantly, hydrogen can be a low- or even zero-emission form of energy through the use of renewable energy technology or carbon capture and storage.

Hydrogen's potential as a form of energy has been known for a long time, but development of the hydrogen industry has stagnated. Experts point to three factors that have led to renewed interest in the hydrogen industry down under:

  • Hydrogen has become cheaper to produce. With the new abundance in renewable energy, and the continued abundance of fossil fuel energy, it has never been more cost-effective to produce hydrogen from electrolysis (using an electric current to split water into hydrogen and oxygen), steam methane reforming (reacting natural gas with high-pressure steam) or coal gasification.
  • It has become cheaper and easier to use in a variety of applications. Hydrogen technology has now been proven at commercial scale for mobility, energy storage, and as a clean fuel in gas networks. For example, hydrogen fuel cells have become smaller and cheaper, and therefore are more easily incorporated into vehicle manufacturing. 
  • Finally, hydrogen is in demand. In 2017, the Japanese Ministry of Economy, Trade and Industry outlined a vision for a hydrogen-based society to secure Japan's energy supply and assist in cutting its greenhouse gas emissions. The South Korean government has also shown increasing interest.

What's happening in Australia

The last year has been an exciting time for the hydrogen industry in Australia. A national hydrogen strategy is being developed by governments at the national level and is due to be finalized in late 2019 or early 2020. Hydrogen strategies are also being implemented at state level, including in the resource states of Queensland and Western Australia.

Research and development programs are occurring across multiple Australian universities and research organizations. In March this year, a program run by Queensland University of Technology, supported by Japanese petroleum conglomerate JXTG, conducted the first export of green hydrogen (hydrogen produced from electrolysis using renewable energy) from Australia to Japan.

The private sector is also forging ahead with new projects, often using government grants:

  • Japan's Kawasaki Heavy Industries is coordinating a pilot project in the coalmining hub of the Latrobe Valley in Victoria to produce hydrogen through gasification of lignite combined with CCS for export to Japan. 
  • Renewables developers such as Neoen and Union Fenosa are planning co-located wind, solar, battery and hydrogen plants to produce green hydrogen. 
  • Gas utilities such as Jemena, ATCO and the Australian Gas Infrastructure Group are trialing the injection of green hydrogen into gas distribution networks. 
  • Australian LNG producer, Woodside, has invested in a consortium planning to build and operate hydrogen refueling stations across South Korea. 
  • Toyota is transforming a decommissioned car manufacturing plant near Melbourne into a hub to produce green hydrogen for transport.

And in New Zealand

The New Zealand government is also looking to support the development of a new green hydrogen industry after last year's announcement of a moratorium on continuing offshore oil and gas exploration.

In March 2019, the government launched a roadmap for the development of a new green hydrogen industry based in the Taranaki region – the hub of New Zealand's energy sector. The government has also signed a memorandum of cooperation on hydrogen with the Japanese government. In the private sector, the Tuaropaki Trust and Japan's Obayashi Corporation have broken ground on a plant to produce green hydrogen using geothermal energy in Taupō. Ports of Auckland has also announced plans to build a pilot hydrogen production and refueling facility at Waitematā port.

Opportunities for future growth

Projections show increasing global demand for hydrogen, particularly in Asia. Both Australia and New Zealand are well positioned to serve that demand, due to their existing infrastructure, expertise and resources, as well as proximity to key markets.

Continued growth of the hydrogen industry in both Australia and New Zealand will, however, also depend on reducing supply-side barriers to the industry's development, through the following:

  • Stable government policy: major parties in both countries are supportive of the hydrogen industry, and development of the industry has not been politicized in contrast to much else in the energy space. National hydrogen strategies should be concluded and implemented in each country as a priority to capitalize on this support and provide a basis for stable future government policy on hydrogen.
  • Supportive regulatory settings: the electricity and gas regulatory frameworks in Australia and New Zealand have strict requirements as to the gas mixture that can be transported in the gas pipeline network, which, if not amended, may preclude blending of large quantities of hydrogen into the network. Over time, regulations and standards specific to hydrogen and hydrogen technology will also need to be adopted to facilitate the industry. In Australia's federal system, it will also be important to ensure consistency of regulation across jurisdictions, for example, in relation to regulation of hydrogen vehicles.
  • Vertically-integrated corporate structures: long-gone are the days of a single government-owned entity controlling an entire energy network. Today, different parts of the energy networks are owned by different entities, which sometimes have very different priorities. If the hydrogen industry is to continue to develop, it needs new and vertically-integrated corporate structures (including joint ventures) to enable the sharing of benefits, risks and costs, and to align priorities up and down the value chain. Government incentives or participation may be required to make this happen, as collaboration is not something that occurs easily in a market that is often very competitive (and regulated so as to encourage such competition).
  • Infrastructure renewal and development: gas networks and facilities across Australia and New Zealand are in some cases not suited to hydrogen. Infrastructure is constantly renewed, but renewal programs will need to be more comprehensive to adapt infrastructure to materials suited to hydrogen. New infrastructure development will also be challenging: hydrogen projects are not modular to the same extent as wind and solar projects. In some cases large-scale investment will be required, which may require up-front government support and strategic management.
  • Community acceptance: the threat posed to the energy industry by a lack of community acceptance is well known. Fossil fuel industries have been targeted for high greenhouse gas emissions, and renewables industries for land use and the impact on amenities. For the hydrogen industry, maintaining "social license to operate" should be a top priority. In this respect, the industry will need to consider how to address issues of emissions (relevant to non-green hydrogen), water use (relevant to green hydrogen) and safety.

Above all, development of the hydrogen industry will require ambition and focus from governments and the private sector. The next five to ten years will be a crucial period for the gas industry as it seeks to maintain and promote its relevance as an energy source in a world increasingly focused on emissions and decarbonization. A strong hydrogen industry would support decarbonization goals while also providing continuing revenues for government and the private sector.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions