22. October 2021

Hype or holy grail: What’s driving the hydrogen rush?


Bell Bay, at the mouth of the Tamar River, as soon as housed Tasmania’s solely oil-fired energy station. It was in-built the Sixties and, when it was decommissioned in 2009, a brand new plant started working instantly subsequent door: Tamar Valley Power Station, which runs on gasoline as a substitute.

Today, as the world edges additional away from coal, oil and gasoline, Bell Bay’s sprawling industrial precinct has change into the unlikely setting for a brand new part of the vitality transition, one that’s more and more gaining promise as a lacking piece in the push to gradual world warming: inexperienced hydrogen manufacturing.

Hydrogen – which burns cleanly and emits solely water – has been climbing in the direction of the high of the decarbonisation agenda. In the previous a number of months, governments, useful resource corporations and huge Asian vitality customers have been elevating their bets on the gasoline’s future and bankrolling pilot tasks throughout Australia.

Several of those are taking form in Bell Bay, the place Origin Energy, Woodside Petroleum and Fortescue Metals Group are every lining as much as pursue plans for large-scale “green” hydrogen services. By some counts, greater than $190 billion of inexperienced hydrogen tasks had been introduced worldwide in 2020.

Those betting on hydrogen as the subsequent large factor level to its doable functions as each a transportable service of vitality and a direct high-density gasoline itself, able to cleansing up the difficult-to-decarbonise sectors of the economic system. Wind and photo voltaic can provide electrical energy for houses and electric-car batteries, however what will probably be carried out about energy-intensive manufacturing industries for which viable carbon-free alternate options usually are not available? Hydrogen may simply be their resolution. It’s additionally being explored as a clear choice for aviation, transport and heavy freight and an alternate for heating buildings.

The know-how could also be easy however there stay excessive hurdles to inexperienced hydrogen uptake and legitimate scepticism about its outlook. For one, the prohibitively excessive value of the know-how to provide it raises questions on whether or not it could ever be worthwhile. So what’s inexperienced hydrogen? What’s driving the hydrogen rush? Is it hype or may it’s the holy grail?

Artwork: Matthew Absalom-Wong

Artwork: Matthew Absalom-Wong Credit:

What is hydrogen and what’s ‘green’ hydrogen?

Hydrogen (H) is the most plentiful ingredient in the universe – No. 1 on the periodic desk. Here on Earth, nevertheless, it doesn’t exist alone. Rather it combines with different components to kind compounds – primarily water (therefore H2O: two hydrogen atoms, one oxygen atom) but in addition pure gasoline, coal and petroleum.

It is used immediately primarily in oil refining and to provide ammonia for fertiliser, however practically all hydrogen at present comes from coal and gasoline via a course of that emits carbon dioxide into the ambiance. According to the International Energy Agency, the manufacturing of hydrogen globally is liable for round 830 million tonnes of carbon dioxide a 12 months, greater than the complete annual emissions of Australia. This is called “grey” hydrogen.


For hydrogen to have a task in the clear vitality transition, it should be developed with out creating any emissions. One means is to proceed producing hydrogen from fossil fuels however utilizing carbon seize and storage (or CCS) know-how to entice the carbon dioxide earlier than it enters the ambiance and bury it underground. This hydrogen is “blue” hydrogen.

But the cleanest model of all is “green” hydrogen, generated by renewable vitality sources with out emitting any carbon in the first place.

Green hydrogen is made by way of electrolysis, a course of that makes use of an electrolyser to ship an electrical present via water to separate the “H2” from the “O”. When renewable vitality is used to energy the electrolyser, the finish product is emissions-free.

Why is hydrogen on the agenda now?

“I ask myself, why now?, given that the idea of a hydrogen economy has been seriously and frequently proposed since 1972,” stated Australia’s former chief scientist Alan Finkel in 2018. One cause, he wrote, was the quickly declining value of renewable vitality. The different: Japan’s dedication to change into a long-term, large-scale hydrogen buyer.

On the world local weather calendar, 2050 is a crucial 12 months. It’s the deadline by which scientists agree the world should obtain internet zero emissions to ensure that nations to honour the Paris local weather settlement’s objective of limiting world warming to beneath 2 levels above pre-Industrial Revolution temperatures and keep away from the worst results of local weather change.

More and extra nations have set targets to attain internet zero emissions by the center of the century. Australia shouldn’t be considered one of them. But the three greatest patrons of Australian shipments of coal and liquefied pure gasoline (LNG) – Japan, China and South Korea – enshrined their internet zero deadlines in 2020.

“Moving away from fossil fuels, using more renewables, electricity, hydrogen,” says Prakash Sharma, Wood Mackenzie Asia-Pacific head of markets and transition. “This is what net zero is all about.”

Why Japan’s pledge is especially vital is that the nation is resource-poor and relies on imported fossil fuels to produce 94 per cent of its vitality wants. Wood Mackenzie, a worldwide consultancy, tasks that Japan’s decarbonisation technique will drive vital demand for hydrogen imports by the 2030s because it units targets to mix hydrogen with pure gasoline for energy era and have 800,000 hydrogen fuel-cell automobiles on its roads by 2030.

More broadly, although, most developed nations are pledging on comparable mid-century targets to get to carbon neutrality and, in the seek for methods to decarbonise industries that can’t merely be electrified and powered by renewable sources, extra eyes are turning to hydrogen.

In nations corresponding to Australia, governments and vitality producers have launched into methods to develop hydrogen manufacturing and export capability to fulfill that future demand.

The Hyundai Nexo is the first hydrogen-fuelled vehicle to be certified by the Australian government for use on the road.

The Hyundai Nexo is the first hydrogen-fuelled automobile to be licensed by the Australian authorities to be used on the street.

How may hydrogen assist?

As the push to zero out greenhouse gasoline emissions takes on better urgency worldwide, the resolution for a few of the heaviest contributors to world warming is already apparent and accessible: electrification. In Australia and round the world, electrical energy era will proceed shifting from fossil fuels to wind and photo voltaic – supported by batteries and pumped hydro. Cars that run on petroleum could be changed with automobiles that run on batteries charged by a low-carbon energy grid. So can buses, trams and trains.

But what about components of the economic system important to fashionable civilisation that may’t be simply electrified – corresponding to the manufacturing of merchandise corresponding to metal, cement, glass and chemical compounds that use coal or gasoline to provide ultra-high warmth or as a uncooked materials? Then there are different types of transport – aviation, transport and long-haul trucking – that require high-density gasoline to journey a lot additional distances than present battery know-how is able to supplying.

By some counts, 1 / 4 of worldwide emissions come from this so-called “difficult-to-decarbonise” class. Perhaps the most tantalising enchantment of inexperienced hydrogen is its potential to scrub up a few of these sectors which have proved laborious to decarbonise in the previous.

One of the high targets for hydrogen is the steel-making trade, which instantly accounts for as much as 8 per cent of world emissions. Steel-making emissions come from the coal used to provide coke for the big superheated blast furnaces that convert iron ore to molten pig iron. Hydrogen may substitute coal on this course of.

It’s a know-how being explored by steel-makers round the world. In Australia, the Andrew “Twiggy” Forrest-backed Fortescue – an iron ore mining firm that accounts for two million tonnes of greenhouse gasoline yearly – is concentrating on plans to construct the nation’s first inexperienced metal plant later this 12 months, which is able to look at know-how together with inexperienced hydrogen.

“Replace coal in the furnace with our old friend, green hydrogen … you get steel,” says Forrest. “But instead of emitting vast clouds of CO2, you produce nothing more than water vapour.”

Another of the most rapid functions for clear hydrogen is fuel-cell electrical autos. Hydrogen automobile know-how has been considerably overshadowed by the extra in style and more and more mainstream battery-powered electrical autos, corresponding to Teslas. Hydrogen autos account for lower than 0.1 per cent of autos produced annually.


However, hydrogen automobile know-how has some benefits over batteries, together with, usually, an extended driving vary and much faster refuelling instances that might make it a extra viable various for heavier autos corresponding to vehicles.

The lighter weight of hydrogen in comparison with batteries, which permits for better distances with out refuelling, and an vitality density per unit mass that’s thrice greater than conventional fuels has positioned it as considered one of the most promising zero-emission applied sciences for plane, too. Hydrogen has considered one of the highest vitality density values per mass – 120 MJ/kg for hydrogen versus 44 MJ/kg for petrol. (This signifies that for each 1 kilogram of mass, hydrogen has an vitality worth of 120 megajoules.)

Airbus, the world’s greatest plane-maker, spent years exploring batteries however in 2020 turned its focus to hydrogen choices as a substitute. Glenn Llewellyn, the firm’s vice-president of zero-emissions know-how, says battery know-how is “not improving at the rate needed” for Airbus to attain its ambitions.

Will hydrogen dwell as much as the hype?

Waves of enthusiasm about hydrogen as the clean-burning gasoline that might substitute fossil fuels have come and gone for many years, and nothing a lot has occurred. If hydrogen hype is to ever change into a actuality, excessive hurdles have to be cleared. There is justifiable scepticism about its potential to be something greater than only a pipe dream.

“Mind-bogglingly stupid,” is how Tesla’s Elon Musk describes its use in automobiles when in comparison with lithium-ion batteries. “It’s just very difficult to make hydrogen and store it and use it in a car. If you, say, took a solar panel and use that … to just charge a battery pack directly, compared to split water, take hydrogen, dump oxygen, compress hydrogen … it is about half the efficiency.”

The overwhelming majority of the 110 million tonnes of hydrogen at present produced globally is from pure gasoline, not renewable vitality. In truth, lower than 1 per cent of hydrogen produced immediately is inexperienced hydrogen.

There are many causes to doubt the potential for hydrogen’s diverse functions. Hydrogen is troublesome to retailer and transport; it’s extremely flammable and has lengthy suffered a picture drawback (assume, Hindenburg); the course of to make inexperienced hydrogen is massively water-intensive (one kilogram of hydrogen requires 9 litres of water, elevating considerations about water sources); and, unquestionably, the high barrier is the value.


The federal authorities has set a objective of getting inexperienced hydrogen produced at $2 per kilogram, the level at which it believes it will be aggressive with hydrogen sources from fossil fuels. The authorities’s renewable vitality company, ARENA, says this is able to imply the value of electrolysers would wish to fall by as a lot as 75 per cent.

“There have been false starts for hydrogen in the past,” the International Energy Agency says, nevertheless it acknowledges vital help is rising from governments, oil and gasoline producers, automotive makers and renewable vitality suppliers. “This time could be different.”

Many specialists, corresponding to these at the revered Grattan Institute assume tank, say too little thought is being given by Australian governments and trade about the place hydrogen know-how has the finest likelihood of being commercially viable. A greater thought can be discovering hydrogen’s niches, which most likely are the sources of emissions that lack clear alternate options.

“The government is placing too many bets on too many horses, and some of those bets may turn out to be a waste of public funding,” Grattan vitality program director Tony Wood says. “Instead of throwing confetti at everything, we should be focusing our resources – prioritising and identifying areas where the fundamental economics might have the most potential.”

Is this a ploy by large oil and gasoline?


In the wake of the newest multibillion-dollar hydrogen funding wave in Australia and round the world, eyebrows have additionally been raised as a result of it’s being funded largely by oil and gasoline corporations, who see it as a lifeline for his or her continued, long-term relevance in a world that’s more and more legislating towards carbon emissions.

Hydrogen may change into a brand new and probably worthwhile trade for them, giving new life to pure gasoline if blue hydrogen takes off, prolonging the longevity of gasoline infrastructure corresponding to pipelines if blue or inexperienced hydrogen is mixed with pure gasoline for heating and cooking, and growing new export alternatives to nations longing for both zero-emissions kind.

“Big Oil’s last stand will be to use fossil fuels to create blue hydrogen – storing the emissions in the ground and peddling it as clean energy,” Forrest argues. “But it’s not clean, and governments are already falling for it.”

Oil and gasoline corporations are investing in each blue hydrogen and inexperienced hydrogen tasks.

Saudi Arabia, the world’s greatest oil exporter, is searching for to change into a hydrogen pioneer, with state-owned vitality big Saudi Aramco specializing in blue hydrogen and one other Saudi agency partnering with US-based Air Products and Chemicals to construct the world’s greatest inexperienced hydrogen plant at the deliberate futuristic metropolis of Neom on the Red Sea.

Oil and gasoline firm executives clarify their trade’s push to guide the hydrogen revolution by saying it is sensible for apparent causes and shouldn’t shock anybody: there’s no different sector in the world that has higher experience.

“It fits well within our competencies as a company. It’s what we do. We produce gases and liquefy them. That’s our base business,” Woodside chief government Peter Coleman says. As properly, the demand for hydrogen is rising from markets that corporations corresponding to Woodside already promote into. “The Asian markets – Japan, Korea and China,” he says.

What’s subsequent for hydrogen in Australia?

When it involves hydrogen, governments each state and federal are setting excessive ambitions for Australia.


In 2019, the Council of Australian Governments’ vitality council endorsed a nationwide hydrogen technique that goals to place the nation as a serious world trade participant and exporter of the gasoline in its super-chilled, liquefied kind by 2030.

Finkel, the nation’s chief scientist at the time, remarked that Australia was “at the dawn of a new industry … that could contribute to jobs, export income, energy storage and, vitally, emissions reduction”.

Australia is investing to assist make this a actuality, committing $300 million for the Clean Energy Finance Corporation and $70 million for the Australian Renewable Energy Agency to jump-start a home trade by supporting tasks. The federal authorities has additionally entered right into a collection of partnerships with Germany, South Korea and Japan to discover the chance of future hydrogen exports.

The federal authorities’s funding plan is “technology neutral”, which means public funding is on the market each to inexperienced and blue hydrogen. This has raised considerations amongst some enterprise leaders, renewable vitality advocates and the ACT authorities that utilizing hydrogen to retailer fossil fuel-generated vitality may lengthen the operation of coal- and gas-fired energy stations and enhance demand for fossil fuels that may very well be served by renewables.

Green hydrogen, nevertheless, seems to be attracting extra consideration, with new tasks and three way partnership partnerships throughout the nation. In Western Australia’s distant Pilbara area, a consortium is planning the Asian Renewable Energy Hub, proposing to provide inexperienced hydrogen and export inexperienced ammonia on an enormous scale.

Blue Infinite Energy is forging forward with the Arrowsmith Hydrogen Project, north of Perth, largely from on-site solar energy.

In NSW, gasoline pipeliner Jemena says its $15-million Western Sydney Green Gas venture will generate sufficient hydrogen to fulfill the vitality wants of about 250 houses and companies from mid-2021 and, underneath a cope with Hyundai, may provide hydrogen to gasoline the carmaker’s NSW automobile fleet.

Origin Energy, considered one of Australia’s largest energy and gasoline corporations, is proposing a inexperienced hydrogen manufacturing plant at Bell Bay for inexperienced ammonia exports in a single venture and, in one other, is planning an electrolyser in Townsville for inexperienced hydrogen for export and native provide in partnership with Japan’s Kawasaki Heavy Industries.

Woodside’s efforts are additionally centred on two tasks: the Badgingarra Renewable Hydrogen Project in WA’s wheat belt area to provide inexperienced hydrogen for transport and industrial functions; and the H2TAS inexperienced hydrogen venture in Bell Bay, concentrating on growing hydrogen for the transport sector.

In the newest improvement, the Tasmanian authorities struck an settlement with Woodside to help its utility for ARENA funding, and Woodside is working with TasGas to evaluate mixing hydrogen in the island’s gasoline pipeline community.


Places corresponding to Bell Bay are thought of ideally suited for hydrogen tasks as a result of they’re established industrial precincts, have the mandatory present infrastructure and, critically, have entry to low-cost and plentiful hydroelectric energy, an essential issue for inexperienced hydrogen tasks to be aggressive globally.

“In terms of renewable hydrogen, three things you need are electricity, water and infrastructure – road, rail and port – and we’ve got all them in spades in Tasmania, and specifically here in Bell Bay,” says Guy Barnett, the state’s Energy Minister.

“Unlike many other hydrogen manufacturing opportunities around the world, Tasmania has the best of the best – it’s up to 15 per cent more cost competitive here compared to the mainland because of the complementary nature of our hydroelectric facilities working with wind.”

Indeed, entry to monumental wind, photo voltaic and hydro sources are considered one of the causes governments and trade consider Australia is a perfect location, together with the nation’s commerce relationships with large north Asian LNG clients. But in a bid to change into the world chief, competitors will probably be fierce as nations corresponding to Saudi Arabia make investments closely in the know-how, too.

As the Grattan Institute’s Tony Wood explains, Australia’s lofty hydrogen plans have some approach to go earlier than the know-how begins to make sense economically. And, though massively promising, whether or not hydrogen will dwell as much as the authorities’s hopes shouldn’t be the positive factor some hydrogen evangelists are proclaiming it to be.

“Rose-coloured glasses are a really nice thing to have,” says Wood. “But sometimes I would replace them with clear glass instead.”

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