Australian hydrogen technology company Hysata has made a major breakthrough in the quest to produce commercial hydrogen for less than $2 a kilogram.

Through the development of an ultra-high efficiency electrolyser, the company has achieved the milestone, which is considered the benchmark for commercial production of the green fuel.

Electrolysers are used to split water into hydrogen and oxygen, but generally these are inefficient and expensive, meaning cost-effective hydrogen production in Australia has generally been viewed as being at least a decade away.

Typical electrolysers have changed very little in the past 50 years, running at around 75 per cent efficiency, meaning around 25 per cent of energy input is wasted.

However, Hysata’s “capillary-fed electrolysis cell” can produce hydrogen from water at 95 per cent cell energy efficiency, which is a game-changer in the hopeful commercialisation of hydrogen by 2025.

The company says it can mass produce hydrogen significantly under $2 a kilogram, further reducing energy requirements.