Japanese-funded $500m project to extract hydrogen from Victorian coal is at risk, sources say

People familiar with the Hydrogen Energy Supply Chain project said only a portion of the ¥220bn (A$2.48bn) funding will actually be spent on developing a liquefaction plant in the Latrobe valley and export facilities at the nearby Hastings port.

Opponents, though, say the cost of capturing and storing the resulting carbon emissions will likely render fossil fuel-sourced hydrogen uncompetitive.

Worse, the Japanese partners are offering contracts to take hydrogen produced in the Latrobe valley for fewer than five years. The project owners would then have to sign up alternative customers at a time when green hydrogen supplies should already be available.