Privately held power utility EnergyAustralia will expand one of its generation stations to include hydrogen and gas-fired capacity in the near future.

The company announced it was building the 300MW Tallawarra B power station to provide electricity for New South Wales homes and businesses. The power plant will replace the capacity lost from the retiring coal-fired Liddell station.

The peaking plant will start out purely gas-fired and eventually be capable of using a blend of green hydrogen (produced through electrolysis powered by non-carbon resources) and natural gas. The plan is that Tallawarra B’s greenhouse gas emissions will be fully offset to be net-zero carbon over its operational life.

The government of New South Wales approved the project and is providing close to $64 million U.S. in funding, according to news reports. The plant is expected to come online by 2023 or 2024.

“We thank the New South Wales Government for its support for Tallawarra B,” EnergyAustralia Managing Director Catherine Tanna said. “It means the station will be operating in time for the summer of 2023-24, following the closure of the Liddell power station, and it will help to kick start the green hydrogen industry.”

The hybrid hydrogen and gas plant was given the green thumb after Australia’s national government threatened to intervene to deal with potential power shortfalls in the wake of Liddell’s closure. The coal-fired plant is expected to shut down in two years.

Fossil fuels account for almost 80% of Australia’s power generation mix, according to reports. Currently, coal-fired capacity is about 55% but the government is working to reduce that portion in the wake of climate disasters in the island nation.