Speaking at the Australian Financial Review's National Energy Summit, Mr Straughton outlined the increasing importance of hydrogen as a future energy source, saying it had "moved beyond the Hindenburg".

Mr Straughton said hydrogen would play an increasing role in powering the nation, and could eventually replace natural gas.

"Fundamentally, where natural gas is used in turbines, hydrogen could be substituted as a key fuel," he said.

Major energy companies are also exploring the space. Shell and Total SA have invested in the Hydrogen Council, with the industry forecasting total investment of $US10.7 billion ($13.7 billion) over the next five years.

It is also expected to support the transformation of the transport industry, with growth in fuel cell electric vehicles predicted to be within the millions globally by 2030.

Mr Straughton said that "hydrogen fuel cells make more sense than batteries for long distance transport".

Hydrogen-powered vehicles also have zero emissions, only expelling water vapour.

Trials are already underway using hydrogen-powered vehicles in Victoria. Moreland Council and the Victorian state government launched a world first project last month to run the council's entire fleet on hydrogen fuel. South Australia is also aiming to integrate hydrogen powered buses into its Adelaide public transport network.

The CSIRO flagged hydrogen as a new pillar for the oil and gas industry in its most recent sector roadmap.

"The renewed interest in hydrogen in many parts of the world represents an appealing way to diversify and to help contribute to lowering the carbon intensity of the energy sector," the CSIRO said.

"Its appeal for end-users is that with a few changes to equipment, clean burning hydrogen can be directly used in combustion applications as well as used directly in fuel cells for power and transport."

The CSIRO also forecast the growth of large scale solar and wind-powered electrolysis of water to hydrogen, aiding the decentralisation of fuel production, as hydrogen fuel could be created on site rather than transported.