Finance

Ontario launches fund to support hydrogen production by clean energy

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Ontario launches fund to support hydrogen production by clean energy

The Ontario government is establishing a Hydrogen Innovation Fund that will invest C$15 million (US$11.2 million) over the next three years to kickstart and develop opportunities for hydrogen to be integrated into Ontario’s clean electricity system, including hydrogen electricity storage.

According to the Ontario Energy Board, hydroelectric power produced 23.3% of the electricity generated in the province in 2021.

The government said this launch marks another milestone in implementing the province’s Low-Carbon Hydrogen Strategy, positioning Ontario as a clean manufacturing hub.

“The Hydrogen Innovation Fund will help to lay the groundwork for hydrogen to contribute to our diverse energy supply, supporting game-changing investments in electric vehicle production, green steelmaking and clean manufacturing that will create good paying jobs, grow our economy and reduce emissions,” said Todd Smith, Minister of Energy.

Hydrogen Innovation Fund projects would support electricity supply, capacity, storage and demand management, and support growth in Ontario’s hydrogen economy. The fund will support projects across three streams:

  • Facilities already built or operational and ready to evaluate how hydrogen can support Ontario’s clean grid.
  • Hydrogen facilities not yet constructed but could be in-service by a specified date to demonstrate how hydrogen can support Ontario’s clean grid.
  • Research studies investigating the feasibility of novel applications of hydrogen or support future hydrogen project decision making.

The Hydrogen Innovation Fund will be administered by the Independent Electricity System Operator, which is opening applications for the fund in April 2023. Natural Resources Canada modelling shows that hydrogen could make up about 30% of the country’s fuels and feedstock by 2050 and create 100,000 jobs in Ontario.

“As a fuel that can be produced and used with little to no greenhouse gas emissions, hydrogen has tremendous potential to help us meet our long-term economic and environmental goals,” said David Piccini, Minister of the Environment, Conservation and Parks. “Our government will continue to support innovation and investment in clean technologies that will position Ontario as the clean manufacturing and transportation hub of the future while leading Canada in greenhouse gas emission reductions.”

The province is also advancing work to develop the Niagara Hydrogen Centre, led by Atura Power, which would increase the amount of low-carbon hydrogen produced in Ontario by eight-fold. This project would help balance the electricity grid while using previously unutilized water at the Sir Adam Beck hydroelectric generating station to produce electricity for a hydrogen electrolyzer. To support implementation of the project, the IESO entered into a contract for grid regulation services at the Sir Adam Beck station starting in 2024, which will support low-carbon hydrogen production at the Niagara Hydrogen Centre.