Winding Curvy Road in Forest


Here are some answers to common questions we’ve been asked about the HESC Project. To speak to a member of our project team, please contact us.

Pilot Project FAQ

What’s the project timeline?

The HESC Project is being developed in two phases, beginning with a pilot, which aims to demonstrate that hydrogen can be produced using Latrobe Valley coal and transported to Japan.
The pilot is currently underway and is expected to operate in 2021.

If the pilot is successful, the Project Partners will move towards commercial-scale operations and a multi-billion-dollar commercial phase. The decision to proceed to a commercial phase will be made in the 2020s with operations targeted in the 2030s, depending on the successful completion of the pilot phase, regulatory approvals, social licence to operate and hydrogen demand.

Who is delivering the HESC project?

HESC is led by a consortium of experienced industry partners from Japan and Australia: Kawasaki Heavy Industries, Ltd (KHI), Electric Power Development Co., Ltd. (J-POWER), Iwatani Corporation (Iwatani), Marubeni Corporation (Marubeni), AGL Energy (AGL) and Sumitomo Corporation (Sumitomo), and is supported by the Victorian, Australian and Japanese Governments. Royal Dutch Shell (Shell) is also involved in the Japanese portion of the project.

How many local jobs has the pilot created?

The HESC Pilot Project created approximately 400 jobs across the Victorian supply chain.

Are you currently accepting job applications or seeking suppliers?

The HESC Pilot is underway, and currently, there are no longer job vacancies or contract opportunities for suppliers.

The HESC Pilot Project created approximately 400 jobs across the Victorian supply chain. It has the potential for thousands more in the commercial phase, so we encourage interested parties to keep an eye on project progress via our website and e-newsletter.

What will the hydrogen from the pilot be used for?

The primary aim of the HESC pilot phase is to demonstrate that hydrogen can be produced using Latrobe Valley coal and be transported to Japan. About one tonne of hydrogen will be produced during the pilot phase. This will be used for demonstration purposes only.

What are the main uses for hydrogen energy?

Hydrogen is a clean gas that produces only water as an emission when used as fuel for cars, heavy transport, power generation and industry.

Hydrogen is versatile and can be used in a broad range of applications. Hydrogen can be used, like
natural gas, to heat homes and industry, and for cooking. Hydrogen can power fuel cell electric cars, trucks, buses and trains. It can also be used to generate electricity (through fuel cells). Finally, hydrogen can be exported, either as an energy carrier or for use as a chemical feedstock – hydrogen‘s most common use today is as a chemical ingredient.

Combined across these use cases, hydrogen could account for almost one-fifth of total final energy consumed by 2050. This would reduce annual CO2 emissions by roughly 6 giga tonnes compared to today’s technologies.

Is hydrogen safe?

Hydrogen is non-toxic and has been widely used in industry and as a fuel for over 50 years. Technologies and handling practices already exist to ensure it can be safely produced, stored, transported and used.

Yes. Pure hydrogen gas is not toxic and cannot ignite or explode spontaneously. An ignition source and oxidiser (like oxygen) must be present. When handled responsibly and safely, hydrogen is no more or less dangerous than other flammable fuels like natural gas and gasoline. Technologies and handling practices already exist to ensure that hydrogen can be safely produced, stored, transported and used.

Measures will be put in place along all stages of the supply chain to prevent, detect and mitigate the risk of hydrogen risks. These will be in accordance with government standards for portable gases and fuels.

Additional measures will be used to safely store liquid hydrogen, which must be kept at extremely low temperatures, including the development of purpose-built ships for overseas transport.
The liquid hydrogen storage containers are very solid, safe and, similarly to other specialised containers, are manufactured to comply with strict industry standards. They are double-walled and vacuum-sealed. They are also designed to release the hydrogen as a gas in the unlikely event that the outer or the inner wall is breached.

The HESC Project Partners have a wealth of experience in the safe handling of hydrogen gained since the 1970s. They have developed the world’s best practice health and safety procedures that will be followed carefully in all Australian operations. In Japan, they already operate many hydrogen facilities and refuelling stations.

What is the cost of the pilot phase?

The HESC Project is funded by a consortium of experienced industry partners, and the Victorian, Australian and Japanese Governments.

The HESC Pilot will see close to half a billion Australian dollars invested by the Japanese and Australian industry partners, and the Victorian, Australian and Japanese Governments.

The Victorian and Australian Governments have each invested $50 million for the delivery of the pilot as a practical investigation of a viable new industry for the Latrobe Valley and Australia.

What will happen to the new infrastructure once the pilot phase is complete?

Options for the pilot test facilities post-pilot phase are currently under consideration. The project consortium will use the results of the pilot phase to assess whether it will be commercially viable to ‘scale up’ operations to produce and export hydrogen on a commercial scale.

Is the pilot project producing CO2?

Carbon offsets have been purchased to mitigate emissions from the pilot. In the commercial phase, carbon dioxide would be captured during this process and stored deep underground in a process known as carbon capture and storage (CCS).

The CarbonNet Project, which is jointly funded by the Australian and Victorian Governments, is investigating the potential for establishing a commercial-scale CCS network from the Latrobe Valley to offshore storage sites in the Gippsland Basin.

CarbonNet presents a potential CCS solution for the HESC commercial phase. For more information on CCS, we recommend visiting the CarbonNet Project web page:

What will be the cost of hydrogen produced in a commercial HESC Project?

One purpose of the HESC Pilot is to conduct an analysis of the economic feasibility of producing hydrogen gas from coal in the Latrobe Valley, liquefying it and exporting it to Japan.

According to 2019 data from the IEA, hydrogen made from fossil fuel with CCS costs significantly less than hydrogen from renewables – USD $1.20 –2.60/kg, compared to USD $3.20-7.70.

HESC Project Partners are confident they can deliver cost-competitive hydrogen.

Latrobe Valley FAQ

How much hydrogen gas is being produced?

The pilot plant has produced about 1 tonne of hydrogen. The amount of hydrogen gas produced during the commercial phase will be determined during the review of the pilot.

How is the hydrogen gas being stored and transported?

Hydrogen gas is stored and transported in a high-pressure tube trailer from commercial operators who comply with Australian safety standards and are already storing and transporting hydrogen gas in Australia. Trucks will operate during the daytime only. This method of storing and transporting hydrogen is common practice in Australia.

Will there be any toxic waste?

Based on the information available and testing to date, there will be no toxic waste produced by this plant. There will be some waste generated, including ash (from the coal), a small amount of water from the drying and cooling process, and some used refractory and metal material from the gasifier.

All of these waste materials will be contained on-site as part of the plant design, treated on-site or disposed of via accredited disposal pathways.

For the pilot phase we have purchased carbon credits for the CO2 produced. A carbon capture and storage (CCS) system will be implemented for the commercial phase.

Port of Hastings FAQ

Where exactly is the facility located?

The pilot hydrogen liquefaction plant and loading terminal is located on BlueScope-owned land at the Port of Hastings. It is around 2.5 hectares in size (including the wider study area and bushfire buffer zone).

As we will not undertake any marine work, we don’t anticipate any impact on Western Port’s seagrasses/sea life. Partners have started investigation and consultation with relevant parties to scope the possibility of marine pest monitoring and will report back to the community the results of this research.

What happens when gaseous hydrogen comes to Hastings?

The facility will liquefy hydrogen gas by cooling it to − 253°C and reducing it to 1/800th its volume. Specially made refrigeration equipment will be used. The technology has been in use for more than 25 years in many countries.

The liquefied hydrogen is stored at the facility in a multi-layer vacuum insulated cryogenic container. A similar container is already operational in Japan.

The Suiso Frontier will make its first trip to Australia, between October 2021 and March 2022.

What route will the marine carrier take?

The exact route is still to be confirmed. It will most likely be through standard shipping channels in and out of the Port of Hastings and along the east coast of Australia.

How many trips will the marine carrier make between Australia and Japan?

We expect the marine carrier to make one trip between Australia and Japan every three months over the one-year pilot.

How will HESC manage the impacts of ballast water?

We do not anticipate that any ballast water will be released. However, if ballast water needs to be discharged at Hastings, a water treatment facility will be installed on the ship to ensure ballast water is treated prior to being released. This would prevent the spread of foreign marine species to the Port of Hastings.

Will the project require dredging of Western Port to allow the ship to transport hydrogen?

No, dredging is not required.

Liquefaction of hydrogen is very energy-intensive, why are you not using ammonia as a carrier?

Liquefied hydrogen does not need to be converted back to hydrogen once it has been transported. While ammonia has some excellent applications as a hydrogen carrier, it is necessary to convert it back to hydrogen.

The HESC Project is focused on delivering pure hydrogen so it can be utilised upon receipt – for example in cars as a clean fuel. Another reason why the HESC Project uses liquid hydrogen as a hydrogen carrier is that it reduces the volume dramatically (1/800th) which is ideal for mass transport and storage.

Commercial Phase FAQ

What are the details of the commercial phase/facility?

The pilot phase will need to be completed and the results reviewed before detailed planning for the commercial phase can take place. The HESC partners will consider in great detail economics, engineering environmental and community considerations when choosing the commercial sites. If the pilot phase is successful, the HESC project would enter its commercial phase in the 2030s.

Where will the commercial scale project be located?

The commercial phase will be located in the Latrobe Valley and at a port facility that has yet to be determined.

Will there be a pipeline required for the gaseous hydrogen?

A commercial-scale project will require a pipeline from the point of production to the port.

Will the commercial phase go ahead without a CCS solution?

No. Leveraging Victoria’s Carbon Capture and Storage (CCS) infrastructure will be paramount for the commercial phase. Project partners, including governments, have stated that a CCS solution is critical to the HESC Project, to ensure the supply of low-emissions hydrogen.

How many ships would travel in and out of the port in a commercial phase each day?

The exact number will depend on the scale of the commercial project. The Japanese New Energy and Industrial Technology Development Organisation (NEDO) in a 2015 report about a potential HESC commercial project, estimated 11 journeys per year, or one per month (approximately).

If you are only capturing 90% of the CO2 at gasification and also generating GHG emissions via the other supply-chain processes (e.g. diesel ship engine), how is this a clean hydrogen project?

A certification of hydrogen was a recommendation of the National Hydrogen Strategy prepared by Chief Scientist Dr Alan Finkel. A Certificate of Origin would consider CO2 released into the atmosphere during, for example, a HESC commercial project.

It will avoid misunderstanding and provide consumers with transparency around the environmental impacts of the hydrogen, providing flexibility of being technology neutral. The end user of the hydrogen will be able to make an informed decision about the carbon intensity of the hydrogen they are purchasing.

Reliable emissions tracing is also vital to ensure the Australian Government can track progress towards its 2050 Paris Agreement commitments, to limit global temperature increases by reducing national greenhouse gas emissions.

The focus seems to be on export, but if you get to full commercialisation could there be a split to some domestic supply, i.e. dual supply?

The HESC Project was conceived with the primary aim of producing hydrogen in Australia for export and use in Japan. Interest in hydrogen has since grown both internationally and domestically, as industry and governments around the world investigate and execute decarbonisation strategies. HESC Project Partners are supportive of the export of hydrogen, domestic use, or a combination.