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Australia will allocate 2 billion Australian dollars (1.4 billion US dollars) to support renewable hydrogen projects, as this major fossil fuel exporter seeks to reposition itself as a leader in clean energy. The funds, announced in the budget later on May 9, will provide financial support to private developers with the aim of having two to three hydrogen projects operational by 2030. The figure of $1.4 billion pales in comparison to similar spending measures in the United States and Europe. Developers are flocking to take advantage of Australia’s abundant wind and solar resources, as well as its vast areas of land, to produce so-called green hydrogen – a carbon-free energy source that is seen as playing a key role in the world’s transition away from fossil fuels. However, despite the country having the world’s largest pipeline of announced green hydrogen projects, so far few of these projects have reached financial closure. As countries compete for capital, investors and developers say that aggressive subsidies similar to the U.S. Inflation Reduction Act—which provides $374 billion in funding for clean energy—will be needed to attract the substantial investment required. Fortescue Metals Group Ltd. said in a statement on Wednesday that the new measures were a “great first step”. This Australian iron ore miner aspires to become one of the world’s largest producers of green hydrogen, and plans to make final investment decisions on five projects around the world this year.