Hydrogen plant to be built in Adelaide

A demonstration hydrogen plant is set to be built in Adelaide to provide low-carbon gas to local consumers.

An $11 million hydrogen production plant using renewable energy will be built in Adelaide.

Australian Gas Infrastructure Group will build the demonstration plant at the Tonsley Innovation District following a $4.9 million grant from the state government through its $150 million Renewable Technology Fund.

The company says the hydrogen the plant produces will be injected into the local gas distribution network to provide low-carbon gas to homes and businesses.

"We are delighted that South Australia will lead the way with this pioneering technology," AGIG chief customer officer Andrew Staniford said in a statement on Wednesday.

"The aim of the demonstration plant is to reflect how energy will be provided to businesses and homes in the future.

"It will also illustrate the complementary nature of gas and electricity in meeting the decarbonisation challenge."

Mr Staniford said the plant would initially provide gas to the Tonsley Innovation District, but could be expanded to supply a proposed residential development in the area and other remote customers.