Australia shortlists green urea project in second Hydrogen Headstart funding round

Australia has chosen seven renewable hydrogen projects for the second round of its Hydrogen Headstart subsidy program. One of these is a 750 MW green hydrogen plant that will make green urea for use in Australia and overseas. This is an important step for Perdaman’s Helios project in Karratha, Western Australia, as it works to secure funding through the government’s main clean hydrogen incentive.

Perdaman Helios is one of the few fertilizer-focused projects worldwide to make it onto a national hydrogen subsidy shortlist. The other six projects mainly plan to produce methanol, sustainable aviation fuel, and ammonia for shipping and industry. In contrast, Perdaman aims to turn renewable hydrogen into green urea to meet demand from farmers and export markets.

The Hydrogen Headstart program gives successful projects production credits for 10 years. This support helps cover the difference between the cost of making renewable hydrogen and current market prices. The goal is to make projects more attractive to investors and lenders by offering more financial certainty. In the first round, Australia awarded contracts to several large hydrogen and ammonia projects.

This new shortlist highlights Australia’s plan to become a top exporter of renewable hydrogen and related products. The country is using its strong solar and wind resources and its closeness to Asian markets. By producing green urea rather than simply supplying hydrogen or ammonia as energy carriers, Australia could create more stable, long-term demand, serving both agriculture and efforts to cut industrial emissions.

A final investment decision has not yet been made for the Perdaman Helios project. Besides government support, the project still needs commercial off-take deals, access to the power grid, and electrolyzers before building can start.

Source: Argus Media