ARENA allocates $1.3 million for renewable hydrogen study in WA

On behalf of the Australian government, the Australian Renewable Energy Agency (ARENA) is providing $1.3 million to the energy infrastructure business APA Group and the chemical manufacturing company Wesfarmers Chemicals, Energy and Fertilisers (WesCEF) for the $3.5 million ‘Parmelia Green Hydrogen Project – Feasibility Study.’

The two parties will investigate producing and transporting renewable hydrogen through an existing natural gas pipeline south of Perth.

The study will progress investigations into the development of a large-scale renewable hydrogen production facility supported by purpose-built renewable generation south of Kwinana, ARENA said, adding that this hydrogen would be transported via a 43-kilometer section of APA’s existing Parmelia gas pipeline to WesCEF’s ammonia production facilities at the Kwinana Industrial Area south of Perth.

ARENA noted that WesCEF currently manufactures ammonia from natural gas and the renewable hydrogen produced by this project has the potential to reduce overall emissions from the facility.

This feasibility study, according to ARENA, will help improve understanding of developing large-scale renewable hydrogen projects in Australia as well as the technical requirements and economics of transporting renewable hydrogen via pipelines.

Commenting on the study, ARENA CEO Darren Miller said: “The decarbonization of the industrial sector is critical to progressing Australia’s 2030 and 2050 net-zero targets. Renewable hydrogen will be vital to cutting emissions in heavy industries like ammonia production and will be hugely important in industrial centres like Kwinana.”

“This feasibility study will tell us more about what it takes to develop a renewable hydrogen industry in Western Australia and ARENA will play an active role in sharing those lessons with the market.”

According to ARENA, the project follows APA’s work investigating the technical feasibility of its Parmelia gas pipeline to transport hydrogen gas, which has found that it is technically feasible to operate the southern 43-kilometer portion of the pipeline with 100% hydrogen.

To note, ARENA said that since 2017, it has committed over $315 million to 48 renewable hydrogen projects. In October 2023, it opened applications for the $2 billion Hydrogen Headstart program, which aims to support renewable hydrogen production by bridging the gap between the cost of producing renewable hydrogen and the market price.