ARENA shortlisted seven major renewable hydrogen projects across Australia, advancing large-scale clean fuel, ammonia and fertiliser production initiatives.
The Australian Renewable Energy Agency (ARENA), acting on behalf of the Australian Government, has announced the shortlisted projects for the second round of the Hydrogen Headstart Program, representing a significant milestone in the country’s efforts to expand and commercialise its renewable hydrogen industry. The initiative is designed to support large-scale renewable hydrogen developments and strengthen Australia’s ambition to emerge as a leading global supplier of clean hydrogen and hydrogen-derived products.
The projects selected for the next phase of assessment are among the most advanced renewable hydrogen proposals currently under development across Australia. Spread across several states, the shortlisted developments cover a wide range of industrial applications, including the production of methanol, sustainable aviation fuel (SAF), ammonia, fertilisers and alumina processing. These projects are expected to play a key role in reducing industrial emissions while also creating new export and manufacturing opportunities for the country.
In line with the growing importance of the sector, the Australian Government increased the total funding allocation for the Hydrogen Headstart Program to AUD 1 billion in the 2026 Federal Budget. ARENA will now invite the shortlisted applicants to submit detailed full applications as part of the next stage of the process. This phase will involve extensive technical, financial and commercial due diligence, alongside a rigorous merit-based assessment to ensure only the strongest and most viable projects receive support.
ARENA Chief Executive Officer Darren Miller stated that the strong participation in Round 2 highlights continued industry confidence in Australia’s renewable hydrogen future despite the challenges associated with developing such a capital-intensive sector. According to Miller, renewable hydrogen represents both a major economic opportunity and a critical pathway for decarbonisation, particularly in sectors where emissions are difficult to reduce through conventional electrification methods.
He noted that renewable hydrogen could support the production of low-emission fuels for aviation and shipping while also serving as a sustainable feedstock for fertiliser manufacturing. Over the long term, this could contribute to improved energy security and resilience for Australia. Miller also acknowledged that renewable hydrogen projects require substantial investment and long development timelines, but emphasised that the proposals submitted in this round appear strategically aligned with expected future market demand.
Among the shortlisted projects is the 300 MW Bell Bay Powerfuels project in Tasmania, focused on methanol production. European Energy Australia’s South East Queensland Power-to-X Project, featuring a 150 MW electrolysis facility, is also aimed at methanol production. In Victoria, HAMR Energy’s Portland Renewable Fuels Project plans to develop a 220 MW facility targeting both methanol and sustainable aviation fuel production.
Tasmania is also home to HIF Asia Pacific’s proposed 140 MW e-Fuel Facility, another methanol-focused initiative. Western Australia features prominently with two major projects shortlisted, including the 500 MW Murchison Green Hydrogen Project Stage 1B, which will focus on ammonia production, and Perdaman Commercial Developments’ massive 750 MW Helios project in Karratha aimed at decarbonising fertiliser production through urea manufacturing. In Queensland, Summit Hydro’s Gladstone Green Hydrogen Project plans to establish a 120 MW facility supporting alumina production.
Originally announced in the 2023-24 Federal Budget, the Hydrogen Headstart Program was created to accelerate the development of Australia’s renewable hydrogen sector and help bridge the financial gap between production costs and market prices. Under the scheme, successful projects may receive production credits over a ten-year period to improve commercial viability and encourage investment in large-scale clean hydrogen production.
The latest round builds upon ARENA’s ongoing support for renewable hydrogen development. Through Round 1 of Hydrogen Headstart, the agency committed more than AUD 1.2 billion to two major projects. Since 2017, ARENA has allocated more than AUD 396 million to 68 renewable hydrogen initiatives through various funding programs, demonstrating sustained government backing for the emerging industry.
