Tasmania's Renewable Hydrogen Action Plan includes $20 million for a Tasmanian Renewable Hydrogen Fund, another $20 million in concessional loans and $10 million dollars for support services.
In a statement, Premier Peter Gutwein said the Government's goal was to have a renewable hydrogen generation facility up and running by 2022-2024.
The Government has identified Bell Bay in the state's north and Burnie in the north west as potential hydrogen industry hubs.
"Our vision is to … be commercially exporting hydrogen by 2030, creating hundreds of local jobs and injecting billions into the Tasmanian economy," Mr Gutwein said.
Hydrogen alone is not actually a fuel source in itself ? it is carrier of energy.
Hydrogen gas can be produced by splitting water molecules, H2O, into hydrogen and oxygen atoms through the process of electrolysis.
It can then be condensed into a liquid fuel source, which can be used to power cars in a similar way to diesel, or it can be used to generate conventional electricity.