The NSW Government is banking on new investment in green hydrogen to boost rural economies and help the state meet its current target of net zero emissions by 2050.

The state’s newly unveiled hydrogen strategy provides up to $3 billion in incentives, including tax breaks for green hydrogen production, plus a new network of hydrogen refueling stations to support hydrogen hubs in the Illawarra and Hunter regions.

The strategy also includes waiving 90 percent of electricity grid charges for green hydrogen producers that connect to parts of the grid with spare capacity.

The announcement was widely applauded by ETF Securities, which this week launched an exchange-traded fund specializing in investing in the world’s leading hydrogen companies.

ETFS head of distribution Kanish Chu said hydrogen is sometimes called the “Swiss army knife” of decarbonisation.

“The hydrogen economy is an opportunity for green investments, still at an early stage of development.

“However, its potential applications are limitless, from producing fertilizer to powering the world’s transport systems,” Mr Chug said.

Unlike non-green hydrogen production, green hydrogen is usually produced using renewable energy sources.

Since the process only requires water, an electrolyzer and the energy needed to run it, the idea here is to meet the needs that are usually met by existing hydrogen gas, but with a reduced carbon footprint.

NSW Premier Dominic Perrottet has outlined the launch of the state’s new hydrogen strategy as an opportunity to drive decarbonisation and establish Australia as an economic and energy superpower in the wider region.

“Australia has the opportunity to be an energy superpower, New South Wales will lead the country with this hydrogen strategy,” Mr Perrottet said.

NSW Treasurer and Energy Minister Matt Keane suggested the strategy could increase the size of the NSW economy by more than $600 million by 2030.

“Hydrogen will not only help the country cut our emissions in half by 2030. and reach zero by 2050, it will create new opportunities for our heavy industry and economic prosperity from investment and jobs,” Mr Keane said.

He said the strategy was projected to halve the cost of green hydrogen production in NSW and promised it would establish NSW as a destination for global green hydrogen investment.

Meanwhile, Deputy Premier and Minister for Regional NSW Paul Toole highlighted the opportunity the state’s hydrogen strategy presents for rural areas.

“Places like Parkes, Illawarra and the Upper Hunter are uniquely placed to take advantage of these opportunities, with existing supply lines, access to transport links and a skilled workforce ready to make regional NSW a leader in hydrogen technology,” he said.