BP Wins ARENA Funding For Renewable Hydrogen

• BP Australia has won funding worth AUD 1.71 million from ARENA for its renewable hydrogen plan feasibility study
• It will explore the potential for renewable hydrogen to produce renewable ammonia instead of natural gas
• Lightsource BP will advice BP on renewable energy solutions that the latter plans to use for the study
• Ultimately, BP wants to produce about 1 million tons of renewable ammonia from a 1.5 GW fab in Geraldton, Western Australia

The Australian Renewable Energy Agency (ARENA) has selected British oil giant BP plc's Australian presence BP Australia Pty Ltd for AUD 1.71 million ($1.11 million) funding to support a AUD 4.42 million ($2.88 million) feasibility study to build a renewable hydrogen and ammonia production facility in Western Australia.

For the prospective Geraldton located production facility, where wind and solar resources abound, BP wants to investigate the process of producing hydrogen using electrolysis powered by grid connected power and renewable electricity secured through power purchase agreement (PPA). This renewable hydrogen produced will be used to further produce renewable ammonia instead of natural gas.

Advising BP Australia on renewable energy solutions for this pilot plant is solar power company Lightsource BP in which BP plc holds a 50% stake.

BP wants to produce close to 20,000 tons of renewable ammonia annually for domestic use, and once it expands to a commercial scale of some 1.5 GW capacity, the company would aim to produce 1 million tons to be sold domestically and also exported.

Through this feasibility study that's scheduled to be completed by February 2021, BP wants to better understand the technical and financial implications of a fully integrated renewable hydrogen supply chain. It is also aimed at helping the company in its long-term net zero carbon emitter goal to be achieved by 2050.

ARENA says this study will also be analyzing the economic opportunity presented by renewable hydrogen and determine how it can be scaled-up to satisfy future demand.

"This study presents an important opportunity to support heavy industry to reduce its emissions. Early investments in feasibility studies like this will help us to realize the opportunity that renewable hydrogen represents and will ultimately help us to achieve our goal of producing renewable hydrogen and ammonia at a competitive price," said ARENA CEO Darren Miller.

The ARENA funding to BP is part of the Australian government agency's AUD 70 million that it aims to award under its Hydrogen Deployment Competitive Funding Round in 2020. Applications for the funding round opened on April 15, 2020 and will close on May 26, 2020.