Labor commits to using green hydrogen to fuel the Hunter Power Project at Kurri

Opposition leader Anthony Albanese will announce the changes that would make the $600 million project aligned with the Hunter's emerging hydrogen economy during a visit to the area on Tuesday.

The 660 megawatt generator is a key component of the federal government's gas-fired economic recovery.

The government has consistently argued the peaking plant, which will operate for about two per cent of the time, is needed to ensure stability and affordability of electricity supply following the closure of Liddell Power station.

Work is due to start on the plant's construction in the coming months with the aim of having it complete by late 2023.

While the plant's open cycle gas turbines have been designed to allow for a 15 per cent hydrogen-gas blend, the current plans are to initially run the plant on gas to be piped from the Sydney-Newcastle gas pipeline.

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The project has become a lightning rod for opponents of gas technology, who argue the plant will become stranded in an increasingly renewable energy driven system.

Tuesday's announcement represents the first time federal Labor has presented a united front on the Hunter Power Project and follows more than a year of in-fighting over energy and climate policy.

Mr Albanese said a Labor government would instruct the project's proponent, Snowy Hydro Limited, to operate the plant on 30 per cent green hydrogen from the start of operations.

Labor would also instruct Snowy Hydro to upgrade the plant to run on 100 per cent green hydrogen as soon as viable.

It says the goal could be achieved by 2030, based on the timeline for a similar power project being pursed by Squadron Energy at Port Kembla.

"Labor's proposal will improve job security for workers and ensure investment in the Hunter - guaranteeing the region will power Australia well into the future," Mr Albanese said.

"A green hydrogen plant will underwrite demand for the fuel in the Hunter, helping the region to become a hydrogen hub for Australia and the world.

"A boost to green hydrogen demand means a boost to renewables like solar and wind which are needed to create green hydrogen.

And Labor's proposal is consistent with net zero emissions by 2050, as well as our commitment to 43 per cent emissions reductions by 2030."

The changes would require an as-yet-to-be identified sustainable supply of green hydrogen for the plant, however, Labor says it would make an additional equity injection for Snowy Hydro to deliver the modifications.

The project's Environment Assessment Report notes that further planning approvals would also be required.

"The Department notes that while the project has capability to accept an increased concentration of hydrogen in the gas supply, potential increases are also constrained by the transmission network, which currently does not permit injection of hydrogen, apart from a trial currently underway at Jemena's Horsley Park facility," the report says.

Paterson MP Meryl Swanson, who has been a vocal supporter of the project, said the project was needed to secure the national electricity grid as well as support local industry such as Tomago Aluminium.

"The plant fits in well with Labor's climate change agenda. Gas is an important transition fuel, and green hydrogen is part of the future. The Hunter is moving towards becoming a hydrogen hub and this plant is an important part of that," she said.

"I will always stand up for my community, and securing local construction and local jobs is very important to me. There will be jobs during construction, and now with the inclusion of a greater mix of hydrogen, there will be green energy jobs into the future."

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