Vietnam-Australia Energy Cooperation: New Momentum from Strategic Initiatives and Hydrogen Investment Opportunities
August 10, 2026 | Annie Nguyễn, VAHC Secretariat
In the context of global energy transition and the Comprehensive Strategic Partnership between the two countries deepening, Vietnam-Australia energy cooperation has recorded significant progress in 2026. Notably, cooperative activities are being accelerated as Party General Secretary and State President Tô Lâm makes an official visit to Australia this week, raising expectations for new strategic cooperation agreements in the energy sector and supply chains.
President Tô Lâm exchanging views with delegates at TechConnect Exhibition, Sydney, Australia, August 10, 2026
Financial Support and Energy Assistance from Australia to Vietnam
Australia has been and continues to be an important partner supporting Vietnam in its energy transition process. Under the framework of Prime Minister Anthony Albanese's visit, Australia committed a USD 105 million support package for Vietnam to address climate change and energy transition. Additionally, Australia increased its development assistance budget for Vietnam in fiscal year 2026-2027 to AUD 98.3 million, focusing on clean energy transition, climate-resilient infrastructure, and sustainable agriculture.
Australia is also implementing financial support initiatives at the regional level. The Southeast Asia Investment Financing Facility, valued at AUD 2 billion, is being actively disbursed, targeting sustainable development and energy transition projects. Notably, through the Australian Development Investments (ADI) fund, the Australian government has committed to investing USD 10 million into the Do Ventures Fund II to support Vietnamese enterprises in energy transition, sustainable production and consumption, and AI-based climate solutions. This move demonstrates Australia's shift from traditional aid to impact investment, promoting the private sector.
Opportunities and Challenges in Australia's Hydrogen Sector
With its advantages in renewable energy resources and critical minerals, Australia aims to become a global leader in green hydrogen production and export. Western Australia is particularly expected to be the center of this transition, with large-scale green hydrogen projects being advanced.
However, the investment landscape for hydrogen in Australia is undergoing adjustments. According to a report by the Energy Industry Council (EIC), Australia currently has 63 hydrogen projects with a total estimated investment of approximately USD 240 billion, leading the Asia-Pacific region in nominal scale. Nevertheless, the majority of these projects remain in the pre-feasibility study stage, and only 6.46 GW out of the proposed 56.35 GW of electrolysis capacity is under construction. The number of contracts awarded also decreased from 54 in 2024 to 27 in 2025, reflecting challenges in reaching final investment decisions (FIDs).
One of the main reasons is policy and funding uncertainty. The budget for round two of the Hydrogen Headstart program was halved to AUD 1 billion in the 2026-2027 budget. Nonetheless, this program remains an important tool to support renewable hydrogen projects in Australia, with potential applicants including large-scale green methanol and ammonia production projects in several states.
Investment from Vietnam and Cooperation Opportunities
Specific information on investment projects from Vietnam into Australia's energy sector has not been widely disclosed. However, bilateral cooperation activities are vibrant, opening many opportunities.
A highlight in cooperation between enterprises of the two countries was the "Vietnam Australia Hydrogen Workshop – H2 Mobility & Decentralised System" organized in December 2024 in Ho Chi Minh City, co-hosted by the Vietnam ASEAN Hydrogen Club (VAHC) in collaboration with PetroVietnam Gas Corporation (PV GAS) and Australia's Pure Hydrogen. The event was supported by key agencies including the Australian Consulate, the Australian Trade and Investment Commission (Austrade), the Hydrogen Council Australia, and international financial institutions. The presence of JICA and the Consul General of Singapore underscored the multilateral nature and shared interest in Vietnam's hydrogen market.
Vietnam Australia Hydrogen Workshop in April 2024 organized by VAHC, PV Gas and Pure Hydrogen in Ho Chi Minh City
The workshop focused on discussing hydrogen solutions for transportation (H2 Mobility) and decentralized hydrogen production and supply systems, while also considering the possibility of establishing a hydrogen supply chain between the two countries, leveraging Australia's strengths in technology and green finance alongside Vietnam's resources and renewable energy potential.
Suggested H2 Investment Cooperation Directions
Based on the current cooperation landscape and the potential of both countries, several promising investment cooperation directions can be identified:
In Vietnam:
Develop small and medium-scale green hydrogen projects: Leverage Australian funds and experience to develop hydrogen production projects from wind and solar power, serving industrial zones and transportation, particularly decentralized systems as discussed at the 2024 workshop.
Cooperate on standards and safety: Australia has experience in developing standards for the hydrogen industry. Vietnam can cooperate to build appropriate legal frameworks and technical standards, facilitating investment attraction.
Supply chain and technology transfer: Australia can transfer technology for electrolyzer production, hydrogen storage and transport, helping Vietnam build domestic capabilities in the hydrogen value chain.
In Australia:
Participate in supply chains for large-scale hydrogen projects: Vietnamese enterprises can become suppliers of equipment, materials, or technical services for hydrogen projects being developed in Australia.
Collaborate on pilot projects: Participate in new technology demonstration projects (e.g., hydrogen use in maritime transport, green steel production) to learn from experience and advanced technologies.
Long-term investment and output assurance: With capital resources and development potential, Vietnamese energy corporations can consider long-term investment in green hydrogen and ammonia infrastructure projects in Australia, combined with long-term purchase agreements to ensure supply for domestic and regional markets.
Conclusion
Vietnam-Australia energy cooperation is at a promising development stage, particularly in the hydrogen sector, supported by high-level political commitments, financial support programs, and active participation of enterprises from both countries. Party General Secretary and State President Tô Lâm's visit to Australia this week, along with earlier in-depth dialogue activities such as the workshop organized by PV GAS and VAHC, have created a solid foundation for both sides to cooperate, leveraging opportunities from Australia's Hydrogen Headstart program and Vietnam's significant potential in renewable energy, to realize concrete projects and contribute to net-zero emissions targets and the sustainable development of both nations.
Prime Minister Anthony Albanese and President To Lam hold a press conference, August 12, 2026.
References:
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Australia's 2026-27 federal budget cuts nearly USD 2 billion from clean energy programs, including Hydrogen Headstart, Battery Breakthrough Initiative, and Solar Sunshot.
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Round 2 of the Hydrogen Headstart program had its budget halved to AUD 1 billion (approximately USD 722 million).
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Round 1 of Hydrogen Headstart awarded AUD 1.2 billion to Copenhagen Infrastructure Partners' Murchison Green Hydrogen project (AUD 814 million) and Orica's Hunter Valley Hydrogen Hub project (AUD 432 million).
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Orica has made a final investment decision for the Hunter Valley Hydrogen Hub project, receiving AUD 432 million in subsidy from the Hydrogen Headstart program.
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The Australian Renewable Energy Agency (ARENA) has announced a shortlist of 7 projects for Hydrogen Headstart Round 2.
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BP's H2Kwinana project (105 MW) in Western Australia was cancelled after not being shortlisted for the Hydrogen Headstart program.
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BP stated the project was dependent on receiving funding and withdrew from the AREH project at Pilbara in 2025 due to inability to secure customer commitments.
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The project had received AUD 70 million from the Regional Hydrogen Hubs program in 2022.
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Vietnam Australia Hydrogen Workshop organized by VAHC, PV Gas and Pure Hydrogen in December 2024.
