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Green hydrogen is coming - and these Australian regions are well placed to build our new export industry

<p>You might remember hearing a lot about green hydrogen last year, as global pressure mounted on Australia to take stronger action on climate change ahead of the COP26 Glasgow summit last November.</p> <p>The government predicts green hydrogen exports and domestic use could be worth up to <a href="https://www.minister.industry.gov.au/ministers/taylor/media-releases/strong-potential-future-australia-germany-hydrogen-exports">A$50 billion within 30 years</a>, helping the world achieve deep decarbonisation.</p> <p>But how close are we really to a green hydrogen industry? And which states are best placed to host it? My research shows that as of next year, and based on where the cheapest renewables are, the best places to produce green hydrogen are far north Queensland and Tasmania.</p> <p>As ever more renewable energy pours into our grid, this picture will change. By the end of the decade, the north Queensland coast could become the hydrogen powerhouse. By 2040, dirt-cheap solar should make inland areas across New South Wales, Queensland, Victoria and South Australia the lowest cost producers.</p> <h2>Renewable energy you can store and transport</h2> <p>Why is there so much buzz around green hydrogen? In short, because it offers us a zero emissions way to transport energy. Take cheap renewable energy and use it to split water into hydrogen and oxygen using an electrolyser. Store the hydrogen on trucks, ship it overseas, or send it by pipeline. Then use the hydrogen for transport, manufacturing or electricity production.</p> <p><a href="https://images.theconversation.com/files/440605/original/file-20220113-19-1sc50s2.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/440605/original/file-20220113-19-1sc50s2.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="Diagram of uses of green hydrogen" /></a> <span class="caption">Pathways for the production and use of green hydrogen.</span> <span class="attribution"><span class="license">Author provided</span></span></p> <p>All the technology exists – it’s the cost holding the industry back at present. That’s where Australia and its wealth of cheap renewable energy comes in.</p> <p>Making hydrogen is nothing new – it has a long history of use in fertiliser production and oil refining. But until now, the main source for hydrogen was gas, a fossil fuel.</p> <p>In the last few years, however, there has been a sudden surge of interest and investment in green hydrogen, and new technology pathways have emerged to produce cheap green hydrogen. As global decarbonisation gathers steam, Japan, South Korea and parts of Europe are looking for clean alternatives to replace the role fossil fuels have played in their economies.</p> <p>Australia is exceptionally well placed to deliver these alternatives, with world-beating renewable resources and ports set up for our existing fossil fuel exports, such as coal and LNG.</p> <p>In 2019, we sold almost $64 billion of black coal, with most going to Japan, South Korea, India and China. As these countries decarbonise, the coal industry will shrink. Green hydrogen could be an excellent replacement.</p> <h2>How competitive is Australian hydrogen?</h2> <p>At present, Australia is a long way from producing green hydrogen cheap enough to compete with fossil fuels, given we seem to have no appetite for taxing carbon pollution.</p> <p>Does that mean it’s a non-starter? Hardly. It was only a decade ago sceptics ridiculed solar and wind as too expensive. They’ve gone awfully quiet as renewable prices fell, and fell, and fell – as tracked by the <a href="https://www.irena.org/Statistics/View-Data-by-Topic/Costs/Global-Trends">International Renewable Energy Agency</a>. Now renewables are <a href="https://www.csiro.au/-/media/EF/Files/GenCost2020-21_FinalReport.pdf">cheaper than coal</a>. Battery storage, too, has fallen drastically in price. The same forces are at work on the key technology we need – cheaper electrolysers.</p> <p>By 2040, the CSIRO predicts an 83% fall in electrolyser costs, according to its <a href="https://publications.csiro.au/publications/publication/PIcsiro:EP2021-3374">Gencost 2021-22 report</a>. By contrast, gas-derived hydrogen with carbon capture is predicted to reduce in cost only slightly. That means green hydrogen is likely to capture much of the market for hydrogen from 2030 onwards.</p> <h2>Which states could benefit?</h2> <p>My research with the <a href="https://www.swinburne.edu.au/research/platforms-initiatives/victorian-hydrogen-hub/">Victorian Hydrogen Hub)</a> shows as of next year, the lowest cost location for green hydrogen would be Far North Queensland ($4.1/kg) and Tasmania ($4.4/kg) due to high renewable resources.</p> <p>But this picture will change. By 2030, northern Queensland’s coastal regions could be the Australian hydrogen powerhouse due to a combination of cheap solar and access to ports. Western Australia and the Northern Territory could also have similar advantages, though the modelling for these areas has not yet been done.</p> <p>As solar energy and electrolyser costs continue to fall, new states could enter the green hydrogen economy. In CSIRO’s cost predictions, electricity from solar is predicted to become much cheaper than wind by 2040. This means sunny areas like central and northern Queensland ($1.7/kg) and inland NSW, Victoria and South Australia ($1.8/kg) could be the best locations for green hydrogen production.</p> <p>In making these estimates, I do not consider supply chain and storage infrastructure required to deliver the hydrogen. Transport could account for between $0.05/kg to $0.75/kg depending on distance.</p> <p>Comparing my modelling to price thresholds set out in the <a href="https://www.industry.gov.au/sites/default/files/2019-11/australias-national-hydrogen-strategy.pdf">National Hydrogen Strategy</a> indicates we can produce green hydrogen for trucking at a similar cost to diesel within four years. Fertiliser would take longer, becoming competitive by 2040.</p> <p><a href="https://images.theconversation.com/files/440388/original/file-20220112-21-1jzafzm.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/440388/original/file-20220112-21-1jzafzm.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="" /></a> <span class="caption">The levelised cost of hydrogen at renewable energy zones in Australia for 2023, 2030 and 2040. (source: Steven Percy, Victorian Hydrogen Hub)</span></p> <h2>Does our dry country have the water resources for green hydrogen?</h2> <p>If we achieved the $50 billion green hydrogen industry the government is aiming for, how much water would it consume? Surprisingly little. It would take only around 4% of the water we used for our crops and pastures in <a href="https://www.abs.gov.au/statistics/industry/agriculture/water-use-australian-farms/latest-release">2019-20</a> to generate an export industry that size – 225,000 megalitres.</p> <p>Much more water than this will be freed up as coal-fired power stations exit the grid. In Queensland and NSW alone, these power stations consume around 158,000 megalitres a year according to a <a href="https://apo.org.au/sites/default/files/resource-files/2020-04/apo-nid303605.pdf">2020 report</a> prepared for the Australian Conservation Foundation. Coal mining in these two states takes an additional 224,000 megalitres.</p> <p>As the cost of renewable energy falls and falls, we will also be able to desalinate seawater along our coasts to produce hydrogen. We estimate this would account for only about 1% of the cost of producing hydrogen, based on Australian Water Association <a href="https://f.hubspotusercontent30.net/hubfs/14568786/Fact%20Sheets/Desalination_Fact_Sheet.pdf">desalination cost estimates</a>.</p> <h2>How can we get there faster?</h2> <p>This decade, we must plan for our new hydrogen economy. Government and industry will need to develop and support new hydrogen infrastructure projects to produce, distribute, use and export hydrogen at scale.</p> <p>We’re already seeing promising signs of progress, as major mining companies <a href="https://www.abc.net.au/news/2021-10-10/qld-palaszczuk-andrew-forrest-hydrogen-gladstone/100527670">move strongly</a> into green hydrogen.</p> <p>Now we need governments across Australia to rapidly get optimal policy and regulations in place to allow the industry to develop and thrive.<!-- Below is The Conversation's page counter tag. Please DO NOT REMOVE. --><img style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;" src="https://counter.theconversation.com/content/174466/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" /><!-- End of code. If you don't see any code above, please get new code from the Advanced tab after you click the republish button. The page counter does not collect any personal data. More info: https://theconversation.com/republishing-guidelines --></p> <p><span><a href="https://theconversation.com/profiles/steven-percy-611961">Steven Percy</a>, Senior Research Fellow, Victorian Hydrogen Hub, <em><a href="https://theconversation.com/institutions/swinburne-university-of-technology-767">Swinburne University of Technology</a></em></span></p> <p>This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/green-hydrogen-is-coming-and-these-australian-regions-are-well-placed-to-build-our-new-export-industry-174466">original article</a>.</p> <p><em>Image: Shutterstock</em></p>

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Beware the difference between ‘clean’ and ‘green’ hydrogen

<div> <div class="copy"> <p><a rel="noreferrer noopener" href="https://cosmosmagazine.com/earth/cosmos-briefing-hydrogen-fuel/" target="_blank">Hydrogen</a> is set to be a crucial part of the energy sector by 2030. It combusts and releases energy without making carbon dioxide, meaning it <em>can</em> be used as an emissions-free source of energy – but research from the Australian National University reminds us that it could have an emissions-intensive future as well.</p> <p>The federal government has listed clean hydrogen as a priority in its <a rel="noreferrer noopener" href="https://cosmosmagazine.com/earth/climate/australian-government-sets-a-net-zero-by-2050-emissions-target/" target="_blank">net-zero emissions plan</a>, and various <a rel="noreferrer noopener" href="https://cosmosmagazine.com/technology/energy/the-incoming-hydrogen-boom/" target="_blank">state governments</a> and <a rel="noreferrer noopener" href="https://cosmosmagazine.com/technology/energy/electrolysers-hydrogen-fuel-manufacture-australia/" target="_blank">private entities</a> have invested in clean hydrogen fuel and infrastructure.</p> <p>‘Clean’ hydrogen does not necessarily mean it’s emissions-free: while ‘green’ hydrogen, made from water with renewable energy, involves no carbon at all, other types of hydrogen can still emit greenhouse gases.</p> <p>“The Australian Government, and quite a few other governments around the world, have used a definition of ‘clean’ hydrogen that includes ‘blue’ and ‘green’ in their hydrogen strategies. And they’ve not really differentiated at all between these two ways of making hydrogen,” explains Dr Fiona Beck, a senior lecturer at ANU.</p> <p>Currently, most industrial hydrogen is made from methane (natural gas) – releasing CO<sub>2</sub> in the process. ‘Blue’ hydrogen is hydrogen made from methane, with carbon capture and storage preventing most of the CO<sub>2</sub> from getting into the atmosphere.</p> <p>“The true emissions intensity of blue hydrogen has not been very well reported so far,” says Beck.</p> <p>“For example, international hydrogen strategies assume that you can capture up to 90% of emissions from blue hydrogen, but they’re missing out some really critical parts.”</p> <p>Beck is co-author on a recent <a rel="noreferrer noopener" href="https://doi.org/10.1016/j.apenergy.2021.118145" target="_blank">paper</a> in <em>Applied Energy,</em> examining the relative costs and emissions of blue and green hydrogen.</p> <p>The researchers point out that the CO<sub>2</sub> produced while making hydrogen from methane is not the only greenhouse gas involved. It also takes energy to capture and store the CO<sub>2</sub>, for instance – and excess methane is released as well.</p> <p>“Whenever you extract natural gas, you end up with what we call ‘fugitive emissions’. These are methane leaks that happen during the process of extracting the gas, processing the gas, transporting the gas,” says Beck.</p> <p>“It’s really critical that these are accounted for because methane is a really bad greenhouse gas. It’s worse than carbon dioxide.”</p> <p>While blue hydrogen is currently cheaper to make than green hydrogen, the researchers found that this could change as electrolysers – which are used to make green hydrogen – become more mass-produced.</p> <p>“Electrolysis with renewable energy could become cheaper than fossil fuels with CCS,” says co-author Dr Thomas Longden, also at ANU.</p> <p>“CCS is an expensive option for emissions reduction with most estimates for the cost of carbon capture being above $82 per tonne of carbon dioxide. These estimates increase to about $109 per tonne of CO<sub>2</sub> for high capture rates,” he adds.</p> <p>“Blue hydrogen is sometimes discussed as a transition between just using natural gas and going fully green. But one of the things that we discuss in the paper is it’s really unclear how long blue hydrogen would be cheaper than green hydrogen,” says Beck.</p> <p>Both the blue and green hydrogen industries are in their nascency. The researchers believe an exclusive focus on green hydrogen will be both more economically sensible, and better for the environment.</p> <p>“It’s just the wrong trajectory,” says Beck.</p> <p>“If you’re going to put a whole lot of money into a new industry, it should be an industry that’s at least compatible with this energy transition. And we don’t believe that blue hydrogen is really compatible with reducing methane and carbon dioxide.”</p> <em>Image credits: Shutterstock</em></div> <div id="contributors"> <p><em>This article was originally published on <a rel="noopener" href="https://cosmosmagazine.com/technology/energy/beware-difference-between-clean-and-green-hydrogen/" target="_blank">cosmosmagazine.com</a> and was written by Ellen Phiddian. </em></p> </div> </div>

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