Government invests $19.9m from PGF in 'game-changing' South Taranaki hydrogen facility

Friday, 6 March 2020

A 'game-changing' project that will fuel New Zealand's first hydrogen-powered trucks is receiving a push start of $19.9 million from the Government.

On Friday, Deputy Prime Minister Winston Peters announced nearly $20m from the Provincial Growth Fund would be invested in a hydrogen energy facility in Kapuni, South Taranaki.

The facility, which will see hydrogen produced from renewable electricity and water, is part of a joint venture between Taranaki-based Hiringa Energy Limited and Ballance Agri-Nutrients Limited, which has a plant at Kapuni.

The hydrogen will then be used to power the plant, with a future focus on the transport industry and getting low-emission hydrogen-powered trucks on the road.

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In a speech made at Balance's Kapuni plant, Peters said hydrogen generated approximately 98 per cent less carbon dioxide emissions, so it could enable fewer emissions for commercial and heavy vehicle transport.

'We're glad to see ambitious, game-changing projects like this led by innovative companies,' Peters said.

'Projects like these are vital to New Zealand's economy.'

Peters said this would create 50 jobs through construction and seven jobs after construction.

Hiringa Energy chief executive Andrew Clennett said his company's focus was transport in New Zealand, but only for now.

'We're building infrastructure to take this hydrogen to put into the trucks to decarbonise the fleet,' Clennett said.

'We're focussing where we can have the biggest impact - where we can have the biggest impact on our emissions and the biggest impact on our economy, in a positive way.

'We can take this further, these concepts, too.'

Ballance Agri-Nutrients Limited chief executive Mark Wynne said the project started as a 'meeting of the minds' in 2017.

'It's a bit of a chicken and egg situation,' Wynne said.

'If you look at the hydrogen transport market in New Zealand, of course there is none. There are no hydrogen trucks because there's no hydrogen supply for transport, and there's no hydrogen supply for transport because there's no trucks demanding it.'

Wynne explained as Balance is one of the largest hydrogen producers and Hiringa Energy had the ability to develop a transport model, working together was 'stronger than trying to do it alone'.

'This is a really, really exciting project.'

The project will cost $50m in total and it could take about 12,500 tonnes of carbon out of the environment, which is the equivalent of about 2500 cars, Wynne said.

In an emailed statement, Venture Taranaki chief executive Justine Gilliland said it was a major boost for the region's transition to a low-carbon economy.

'Leveraging natural resources – in this case wind energy – to meet the energy needs not only of the Ballance ammonia-urea plant but also the associated transport fleet, is another strong signal that Taranaki is standing up to lead New Zealand into a low-emissions future,' Gilliland's statement said.

The PGF also featured in Peters' speech to the Taranaki Chamber of Commerce later in the day, where he said the fund in its current form would be a bottomline for any post-election coalition talks.