The Senate has passed critical legislation that will pave the way for the Australian Government to establish a hydrogen production tax incentive (HPTI).
The Future Made in Australia (Production Tax Credits and Other Measures) Bill 2024 will establish a HPTI worth $2 per kilogram of renewable hydrogen produced between 2027-2028 and 2039-2040 for up to 10 years per project.
Related article: H2 Council calls for urgent hydrogen production tax incentive
Australian Hydrogen Council CEO Dr Fiona Simon said, “We are thrilled to see this critical legislation pass. Establishing a hydrogen production tax incentive keeps Australia in the race globally and provides greater certainty to investors while also setting us up to achieve the goals set out in our National Hydrogen Strategy.
“There is no ‘do nothing option’ when it comes to hydrogen. We need it as a large-scale option for decarbonising energy that requires molecules. And we need it as a chemical solution to produce commodities like green iron. And we also need to remain a trusted energy partner across Asia and the export of molecules is critical to Australia’s ongoing prosperity.
“We look forward to working with the Australian Government to support the rollout of the hydrogen production tax incentive. This combined with the upcoming announcement of Hydrogen Headstart recipients will be a welcome boost for companies who are ready to invest in Australia.”
Australian electrolyser firm Hysata also welcomed the news, with CEO Paul Barrett commenting, “Passing of this legislation strengthens Australia’s hydrogen prospects and sends a positive signal to the rest of the world that hydrogen will be an important part of Australia’s clean energy future. Hydrogen can decarbonise Australian heavy industry and unlock export opportunities by using hydrogen as a chemical feedstock in the hard-to-abate sectors.
Related article: Hysata inks major electrolyser deal for Saudi green hydrogen
“With Hysata’s high-efficiency electrolysers, Australia has the technology, capability, and now the beginnings of policy needed for Australia to be a competitive location for hydrogen production. We look forward to seeing the rollout of the Federal Government’s holistic hydrogen agenda, including Hydrogen Headstart and support to build sovereign capability in electrolyser manufacturing.”
