Queensland state-controlled utility CS Energy and its joint venture partner Japanese engineering firm IHI will build a pilot hydrogen plant with capacity of 50,000 kg/yr from 2023, with the hydrogen to be produced from solar photovoltaic (PV) and batteries.
The plant will be located beside CS Energy's 750MW Kogan Creek coal-fired power plant in Queensland.
The construction of the pilot plant follows a feasibility study on a hydrogen demonstration plant started earlier this year between the two firms. Construction is expected to start in 2022 and commissioning in early 2023, the minister said.
The cost of the plant was not disclosed. The Queensland state government plans to establish a A$2bn ($1.55bn) fund to finance renewable energy and hydrogen projects in the state. The plant will be owned by the Queensland state government, but IHI will have a role in the construction, a spokesman for the Queensland government told Argus.
CS Energy had been met with strong interest from potential domestic offtakers after a successful feasibility study with IHI, said Queensland minister for energy, renewables and hydrogen Mick de Brenni in a statement.
CS Energy is looking to support the decarbonisation of the heavy transport and haulage market with their locally produced zero emission fuel and discussions are well advanced with multiple potential offtakers, de Brenni said.
The pilot hydrogen plant follows the announcement that Fortescue Future Industries, the renewable energy arm of Australia's third-largest iron ore producer Fortescue Metals, plans to build a hydrogen electrolyser production plant at Gladstone in Queensland and convert an ammonia production facility near Brisbane to green hydrogen.