Brisbane could be home to one of the world's largest renewable hydrogen plants following an injection of federal funds into an ammonia project.
Fortescue Future Industries and Incitec Pivot will receive $13.7 million in funding from the Australian Renewable Energy Agency (ARENA) to investigate developing a hydrogen facility to decarbonise an ammonia plant.
A proposed 500-megawatt electrolyser capable of producing up to 70,000 tonnes of renewable hydrogen annually is at the centre of the $38 million project.
It will be used at Incitec Pivot's ammonia plant at Gibson Island.
Energy Minister Chris Bowen said the project could provide insight into the cost of producing renewable hydrogen as Australia looks to the energy source as a fossil fuel alternative.
"If successful, the electrolyser will be the largest built to date, feeding renewable hydrogen directly into the first fully decarbonised ammonia facility," he said.
"The study is critical to the domestic and export industry for clean hydrogen and ammonia supply chains to deliver Australia's first renewable hydrogen shipments to international markets."
Fortescue Future Industries is a subsidiary of Andrew "Twiggy" Forrest's Fortescue Metals Group, with profits from the mining giant's iron ore business used to fund the newer venture's renewable energy projects.
The Queensland government last year approved a feasibility study into building the electrolysis plant after the future of the Incitec Pivot plant was threatened by soaring gas prices.
Ammonia production is a highly energy-intensive process, producing about 500 million tonnes of carbon dioxide annually - around 1.8 per cent of global carbon emissions.
The scale is similar to the aviation industry.
About 80 per cent of ammonia is used to make fertiliser, with the remaining 20 per cent used for industrial purposes such as manufacturing explosives and plastics.
The project would "significantly accelerate" Australia's renewable ammonia industry, ARENA CEO Darren Miller said.
"Having the ability to reutilise ageing assets and repurposing them to use renewable energy will not only help to keep costs down in the future but also ensure skilled workers are retained as we continue our transition to net zero emissions," he said.
ARENA's goal is to reduce the cost of making green hydrogen at scale so it can outcompete hydrogen made with fossil fuels.
"If we can improve the economics of renewable hydrogen, we can realise our collective vision of decarbonising hard-to-abate sectors and establishing significant new export markets," Mr Miller said.
About 100 jobs will be supported across the Brisbane project in the lead-up to a final investment decision, with the first production expected in 2025.
