A hydrogen project proposed as a green solution for Victoria's dying coal industry will likely increase emissions rather than meet its claimed reductions, documents obtained via freedom of information have revealed.
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The state and federally backed project to turn hydrogen into coal for export to Japan could increase emissions by up to 3.8 million tonnes, the Australia Institute said in a report.
Operators' claims of annual emissions reductions equivalent to 350,000 petrol cars - figures repeated by Energy Minister Angus Taylor earlier this year - were based on non-existent technology, the report said.
Analysis later supplied to Mr Taylor's office showed the figures were based on the success of a separate project for carbon capture in the Bass Strait, deemed risky by the Victorian government.
The companies involved, which include Australian-listed AGL Energy, produced the optimistic outlook despite the technology - coal gasification with carbon capture and storage - not yet existing anywhere in the world.
Report author Mark Ogge said it appears likely the real purpose of the Hydrogen Energy Supply Chain is to find a new market for Victoria's brown coal reserves as the state's coal-fired power stations begin to close.
According to Mr Ogge, brown coal has a high water content and can spontaneously combust when dry, making it ill-suited for export.
"Previous attempts to export brown coal with new technology or turn it into fertiliser have failed," he wrote in the report.
"Because building new projects with such an emissions-intensive resource is unacceptable, given its climate impact, proponents are increasingly attempting to reinvent the energy source.
"This idea has found a new home with the production of hydrogen."
The findings are supported by analysis recently conducted by the Australian National University, which found global demand for Australia's once reliable revenue stream was rapidly declining.
Australia Institute climate program director Richie Merzian said clean hydrogen was a marketing term, not a climate solution.
"The Australia Institute polling shows that the term is succeeding in sowing confusion, with 72 per cent of people not realising 'clean hydrogen' can include fossil fuels or renewables," Mr Merzian said.
"Clean hydrogen with fossil fuels relies on the same failed carbon capture and storage technology to bury emissions as clean coal, and it is just as unsuccessful.
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"If hydrogen is supposed to be a climate solution and act as an alternative to fossil fuels, it can't be based on fossil fuels in any way.
"It's concerning that the Australian government was happy to repeat claims from the Hydrogen Energy Supply Chain that their brown coal project will reduce emissions without having any idea of the basis of their claim.