ARENA funding for WA renewable hydrogen study

One of Australia’s largest energy infrastructure businesses and one of Western Australia’s largest chemical manufacturing companies are set to investigate producing and transporting renewable hydrogen through an existing natural gas pipeline south of Perth, in a new study backed by the Australian Renewable Energy Agency (ARENA).

On behalf of the Australian Government, ARENA is providing $1.3 million to APA Group (APA) and Wesfarmers Chemicals, Energy and Fertilisers (WesCEF) for the $3.5 million ‘Parmelia Green Hydrogen Project – Feasibility Study’.

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, WA.

This hydrogen would be transported via a 43-kilometre section of APA’s existing Parmelia Gas Pipeline to WesCEF’s ammonia production facilities at the Kwinana Industrial Area south of Perth.

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.

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-kilometre portion of the pipeline with 100 per cent hydrogen.

Renewable hydrogen will play a key role in Australia’s journey to net zero, by enabling hard to abate industries like metals and chemicals production to substantially reduce their emissions.

The feasibility study 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. 

ARENA CEO Darren Miller said the feasibility study is a step forward for renewable hydrogen in Western Australia.

“The decarbonisation 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,” Mr Miller said.

“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.

APA is already leading in this space with their work on pipeline conversion and ARENA is confident in backing them and WesCEF in this investigation.”

APA CEO and Managing Director Adam Watson said: “This funding contribution from ARENA will support the next stage of this exciting project, which will play an important role in supporting the decarbonisation ambitions of industry.”

WesCEF Managing Director Ian Hansen said: “We are pleased to continue to our collaboration with APA in this exciting project to explore the application of existing infrastructure to support the journey to Net Zero.”

Since 2017, ARENA has committed over $315 million to 48 renewable hydrogen projects spanning early-stage research through to first-of-a-kind deployments including hydrogen refuelling and hydrogen trucks, hydrogen for producing renewable ammonia, hydrogen for use in alumina refining and remote power.

In October, ARENA 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.