Victoria – Hydrogen Industry Policy Initiatives

On 26 February 2021, the Victorian Government launched the Victorian Renewable Hydrogen Industry Development Plan (‘the Plan’). The Plan establishes a blueprint for an emerging renewable hydrogen industry in Victoria. Its goal is to stimulate investment, employment, innovation, and economic growth, as well as supporting Victoria’s clean energy transition.

Front Cover Image VRHIDPAlong with the Plan, the Victorian Government announced the Accelerating Victoria’s Hydrogen Industry (AVHI) Program to support policy and industry development and research.

As part of the AVHI, AUD$7.2 million was made available through two grant programs, the details of which were announced on 22 July 2021 (applications for grants under both programs closed on 27 August 2021):

In January 2022, the Victorian Government announced recipients under the above funding programs:

  • Renewable Hydrogen Commercialisation Pathways Fund: AUD$6.6 million is to be provided to support six projects through this fund.
  • Renewable Hydrogen Business Ready Fund: more than AUD$600,000 is to be shared by eight recipients through this fund.

In partnership with National Energy Resources Australia (NERA), the Victorian Government is co-funding four Victorian Regional Hydrogen Technology Clusters located in Gippsland, Greater Geelong, Mallee and Clayton (Melbourne). A Victorian Hydrogen Cluster Network is being established to support the growth and coordination of these clusters.

The Victorian Government is a founding member of the Australian Hydrogen Centre and is supporting a series of feasibility studies examining hydrogen blending in the natural gas network. These studies are expected to be released in 2022.

On 5 May 2021, the Australian Renewable Energy Agency (ARENA) committed AUD$32.1 million from its Renewable Hydrogen Deployment Fund to Hydrogen Park Murray Valley, a proposal led by the Australian Gas and Infrastructure Group (AGIG) and ENGIE for a 10-megawatt (MW) electrolyser co-located with North East Water’s wastewater treatment plant in Wodonga. The Victorian Government continues to work with the proponents to progress the proposal.

At the beginning of May 2021, the Victorian Government launched its Climate Change Strategy and Zero Emissions Vehicle (ZEV) Roadmap. The roadmap includes battery and hydrogen powered electric vehicles and is supported by a AUD$100 million ZEV package to create a comprehensive strategy to fast track the transition to ZEVs. The ZEV support package includes the following programs open to hydrogen:

  • AUD$46 million for Australia’s first public ZEV subsidy program, which will support Victorian residents and businesses to purchase new ZEVs, including hydrogen fuel cell electric vehicles.
  • AUD$20 million will fund a ZEV public transport bus trial, with a target for all public transport bus purchases to be ZEVs from 2025.
  • AUD$10 million will fund the replacement of the Victorian Government Fleet with ZEVs.
  • AUD$5 million to establish a Commercial Sector ZEV Innovation fund.

In early July 2022, the Victorian Government released a Gas Substitution Roadmap; the roadmap outlines the paths by which energy efficiency, electrification, hydrogen and biogas can contribute to carbon emissions reductions in the State.

The Victorian Government is providing AUD$9 million to establish the Hycel Technology Hub at Deakin University’s Warrnambool campus. A new research and training facility is to be constructed on the campus and will specialise in developing, testing, training, demonstrating, and manufacturing hydrogen fuel technology. Areas of research outcomes will include fuel cells for transport, especially for heavy vehicles, as well as assessing the suitability for natural gas pipelines to carry hydrogen for housing and industry.

In addition, Deakin University aims to transition its Warrnambool campus from gas to hydrogen and convert the Warrnambool Bus Lines fleet to clean energy.

The Victorian Government is providing AUD$10 million for the Victorian Hydrogen Hub (VH2) led by Swinburne University of Technology in partnership with CSIRO and Germany’s ARENA 2036. VH2 will support sustainable manufacturing practices and the ability to store clean energy from renewable sources and striving to create a sustainable future through testing, trialling and demonstrating new and emerging hydrogen technologies. VH2 includes funding to develop a hydrogen refuelling station located at CSIRO’s Clayton campus.

The Victorian Government has also provided AUD$12 million through the Victorian Higher Education State Investment Fund to support Swinburne University of Technology’s Aerostructures Innovation Research Hub (AIR Hub). The AIR Hub is driving innovation in aerostructures with a focus on civil, cargo and aeromedical airliners, urban electric vertical take-off and landing (eVTOL) air vehicles, and advanced composite materials for the space and satellite industries. AIR Hub will also support research and development for hydrogen storage tanks on aircraft and eVTOL vehicles.

The Victorian Government is providing AUD$4.7 million in funding for the University of Melbourne’s Zero Emissions Energy (ZEE) Lab through the Victorian Higher Education State Investment Fund. The ZEE Lab will see Melbourne University work with industry to develop a range of clean energy products across the hydrogen and solar fields, including:

  • new methods for hydrogen gas processing
  • novel hydrogen fuel systems for engine-based power generation and transport, and
  • a new, low-cost electrolyser for producing green hydrogen.

Eligible renewable hydrogen projects have been supported through Round 2 of the Victorian Government’s Energy Innovation Fund, with Yarra Valley Water receiving a grant of AUD$11.9 million for its Renewable Hydrogen Hydro-Gen 1 project.

The Victorian Government committed AUD$50 million to the development of the Hydrogen Energy Supply Chain (HESC) Pilot Project in the Latrobe Valley. The pilot project, which commenced operations in early 2021 and was completed in early 2022, produced and transported hydrogen from coal in the Latrobe Valley and exported it to Japan. The results from the Pilot Project phase are informing the project’s further stages of development; in March 2023, the Japanese project proponents announced the HESC project had entered the commercial demonstration phase, with ¥220 billion Japanese Yen (approximately AUD$2.35 billion) awarded to Japan Susio Energy (JSE) through the Japanese Government’s Green Innovation Fund. JSE indicated that this injection of capital would enable it to design and build commercial scale facilities to liquefy and ship the hydrogen from Port of Hastings to the Port of Kawasaki in Japan.

In March 2022, the Governments of Victoria, New South Wales and Queensland announced an agreement to collaborate on the development of an east coast renewable hydrogen refuelling network by 2026, focusing on the freight corridor routes of the Hume Highway, the Pacific Highway and the Newell Highway. The initiative is to commence with Victoria and New South Wales each providing AUD$10 million to support the design and delivery of renewable hydrogen trucking infrastructure between Sydney and Melbourne, including long-haul hydrogen fuel cell electric freight vehicles. In July 2022, it was announced that applications opened for AUD$20 million in grant funding to support the development of at least four refuelling stations along the Hume highway and approximately 25 hydrogen-powered trucks (with grant applications closing 28 October 2022 in Victoria).

The October 2022-23 federal budget released on 25 October 2022, under the Driving the Nation Fund, includes an allocation by the Commonwealth of matched funding to that already committed by New South Wales and Victoria (AUD$20 million) and makes available the same amount to other jurisdictions on a matching basis (up to AUD$60 million, for a potential total Commonwealth outlay of AUD$80 million).

The October 2022-2023 federal budget also confirmed a funding award of up to AUD$2.98 million to the Victorian based project Zero Degrees Rosella 1 La Trobe Valley Blue Hydrogen via the Commonwealth Government’s Regional Hydrogen Hubs Program.

In September 2022, the Geological Survey of Victoria (GSV) released a report investigating the potential to store hydrogen in depleted gas fields near Port Campbell.


Updated: March 2023