AGL will help lead a world-first pilot project to convert brown coal to liquid hydrogen – a clean energy solution with the potential to reduce carbon emissions. The Australian, Japanese and Victorian governments and a consortium of companies will pilot an innovative supply chain that will deliver liquefied hydrogen from the Latrobe Valley to Japan.

The Hydrogen Energy Supply Chain (HESC) project will convert brown coal from the AGL Loy Yang mine into hydrogen at an adjacent site and then transport the gas by road to a liquefication terminal at the Port of Hastings. It will then be shipped to Japan for use predominantly in the transport industry. AGL CEO Andy Vesey said AGL was proud to play a role in the world-first project.

“As Australia transitions to a carbon constrained future, creating new sources of prosperity and growth in communities which host conventional coal power stations is a critical priority,” Vesey said. “As the operator of Australia’s largest coal mine and the Loy Yang A power station, AGL is a critical contributor to local employment.” The amount of hydrogen being produced for the pilot is small and the emissions released are expected to be minimal. However, to mitigate the impact, carbon offsets will be purchased by the consortium. If expanded in the future, project partners recognise the need for carbon capture and storage.

Vesey said the project could play an important role in the economic transition of the Latrobe Valley. “As we transition to cleaner technologies this project may spark a reinvigoration of Latrobe Valley’s energy industry by generating a competitive edge in a new market,” Vesey said. AGL’s in-kind support for the pilot project includes land for the plant and up to 160 t of brown coal.

The HESC Project brings together industry leaders in Australia and Japan and is led by Kawasaki Heavy Industries (KHI). It includes leading Japanese energy and heavy industries corporations, J-Power, Iwatani, Marubeni Corporation and global energy company Shell. Community feedback will be sought on the project with public information sessions held in the lead up to construction.