The controversial $1.3 billion Hunter Power Project at Kurri will go ahead as planned, Paterson MP Meryl Swanson said.
Ms Swanson, whose electorate takes in the site, spoke to Energy and Climate Change Minister Chris Bowen following the resignation of Snowy Hydro's chief executive Paul Broad last week.
"I said to him 'I want that plant to go ahead' and he said 'it will'. I'm absolutely pleased to receive that very firm assurance from the minister," Ms Swanson said.
The opening of the 660 megawatt plant is due to coincide with the closure of Liddell power station at the end of next year.
While the plant's two turbines will be capable of using a 15 per cent hydrogen blend from the start, the federal government is yet to announce a timeline for the introduction of green hydrogen - a key element of its plans for the project.
The storage and transportation of hydrogen remains a major challenge for achieving the government's vision.
The company is also a partner in the Hunter Green Hydrogen Hub, based at the Port of Newcastle.
Under the existing plan, a giant electrolyser on Kooragang Island will produce green hydrogen using electricity supplied from the Hunter Renewable Energy Zone (REZ).
The Hunter Power Project is among several potential customers for the fuel.
However this would most likely require the construction of a dedicated hydrogen pipeline to the plant given the difficulties of using existing gas infrastructure to transport high concentrations of hydrogen.
Port of Newcastle and Macquarie's Green Investment Group have launched a $A3 million feasibility study into the development of the hub.
It will initially be underpinned by a 40 megawatt electrolyser which can generate sufficient green hydrogen to power 900 buses for a year.
The plant's output will increase to more than a gigawatt over time.
The hub and an associated ammonia manufacturing plant received $100million in the Coalition government's March budget. The Labor government is yet to commit to the funding.
"We are big supporters of the hydrogen industry," he said. "Obviously, as you would expect, we are assessing all of the commitments made by the previous government and we will have more to say in a budget context in October," Mr Bowen said during a recent visit to the project.
Early estimates suggest the site can support a hydrogen facility of up to 2 gigawatt in scale.
Fortescue said on Tuesday that geopolitical ructions of the past year would accelerate the energy transition and the company should be selling green hydrogen within three years with first exports of the flammable gas likely to come from Queensland.
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