Companies developing commercial-scale hydrogen energy projects can get access to $70 million worth of public money, but they must use renewable energy to power the "green hydrogen" trials.

Federal Energy and Emissions Reduction Minister Angus Taylor has selected hydrogen as a priority in the Morrison government's "technology investment road map" to lower Australia’s carbon emissions and meet its commitment to the Paris Agreement to limit global warming to 1.5 degrees.

The Morrison government is backing renewable energy to kick-start its development of a local hydrogen industry.

Mr Taylor said the $70 million fund would assess proposals against their potential to reach a long-term goal of producing hydrogen at $2 a kilogram, which is the “point where hydrogen becomes competitive with alternatives” in the energy grid.

“Getting costs down will be key to establishing Australia as a world leader in the hydrogen sector through both domestic uses, such as blending hydrogen into local gas networks and heavy-vehicle transport use, to exporting Australian-made hydrogen to our key trading partners, like Japan and Korea,” he said.