Japan wants to become a hydrogen fuel leader to meet its net-zero goals, but one blockbuster project is hanging in the balance over questions about its climate credentials.

The Hydrogen Energy Supply Chain (HESC) is billed as a billion-dollar attempt to ship liquid hydrogen from Australia to Japan. However, cold feet about the project in Australia means HESC will source hydrogen from Japan to meet a 2030 deadline for its demonstration phase.

Hydrogen sounds promising on paper: While fossil fuels emit planet-warming greenhouse gases, burning hydrogen creates only water vapor. But it has not yet lived up to its promise, with several much-hyped projects globally struggling to overcome high costs and engineering challenges.