The Japanese government is planning to support companies that help develop hydrogen-fueled electric power plants, earmarking budget funds of ¥2.05 billion for such projects in the next fiscal year.

Companies that build hydrogen-tanker ships, those that convert gas turbines to hydrogen use, and those studying the production of hydrogen from low-quality lignite coal may benefit from the funds, officials said on Sunday.

The need to develop new technology and the high costs involved are significant hurdles to the development of this environmentally friendly power source. Nevertheless, the government wants companies to build a test reactor by 2020 and to begin power generation a decade or so later.