New plan shows Australia’s hydrogen dream is still alive

Producing hydrogen stays important to Australia’s prosperity by the net-zero transition, in response to a serious technique that lays a nationwide pathway to changing into a world chief in low-emissions know-how.

The brand new National Hydrogen Strategylaunched at the moment by Federal Local weather Change and Vitality Minister Chris Bowen, goals to make sure Australia produces inexperienced hydrogen at a aggressive price. It is also designed to information funding and sign Australia’s daring ambitions for the world.

The doc updates the primary nationwide hydrogen technique, launched in 2019 by then Chief Scientist Alan Finkel. I helped devise that technique in my earlier job as a federal public servant. I used to be additionally a part of a panel convened to advise the federal government on the technique launched at the moment (though it was as much as the federal government whether or not the recommendation was accepted).

For my part, this new model of the hydrogen technique improves on the outdated one, and responds to altering circumstances. However a lot stays unclear, together with how the technique interacts with current insurance policies, and whether or not taxpayer money will likely be used to fund hydrogen initiatives doomed to fail.

What’s hydrogen?

Hydrogen is the smallest, lightest and most considerable ingredient within the universe. It is normally discovered as a gasoline, or bonded to different parts.

The ingredient is used to make merchandise reminiscent of fertilizers, explosives and plastics. Sooner or later, it could even be a zero-emissions substitute for fossil fuels in industries reminiscent of metal and chemical manufacturing.

Hydrogen may retailer electrical energy—so it could at some point be used to shore up home electrical energy provides, or be transported in liquid form to nations much less capable of produce renewable power.

Australia at present makes very low volumes of hydrogen utilizing pure gasoline, which produces greenhouse gasoline emissions.

We’re well-placed to supply “green” or zero-emissions hydrogen, by a course of powered by renewable power which releases hydrogen from water.

However creating a big inexperienced hydrogen business will not be straightforward. At the moment’s technique—led by the federal authorities in collaboration with the states and territories—seeks to discover a path by.

Aiming for a brand new goal

The price of producing inexperienced hydrogen is at present greater than what most patrons are keen to pay. The brand new technique seeks to beat this by scaling up manufacturing.

It units manufacturing targets: 500,000 metric tons of inexperienced hydrogen a 12 months by 2030, and 15 million metric tons a 12 months by 2050.

The technique additionally units extra formidable “stretch targets” of 1.5 million metric tons by 2030 and 30 million metric tons by 2050. Reaching it will require discovering new prospects for the hydrogen we produce.

The brand new technique dispenses with a previous target set by the Coalition authorities in 2020, to supply hydrogen for lower than $2 a kilogram.

As I’ve written earlier than, that focus on didn’t account for the high costs of shifting and storing hydrogen, and switching to new know-how that may use it.

Manufacturing and value targets can each be efficient, if they’re reasonable. However whether or not these targets are achieved comes right down to governments’ coverage selections.

Time to prioritize

The technique identifies three industries—iron, alumina and ammonia—the place hydrogen might greatest be used to construct new export industries. It additionally identifies three areas the place hydrogen exhibits promise in reducing emissions: aviation and delivery, electrical energy storage and freight vehicles.

These priorities present governments are coming to grips with hydrogen’s limitations, in a technical and financial sense. For instance, in passenger autos, hydrogen has lost out to electric cars. And utilizing hydrogen to interchange pure gasoline in properties is way costlier than merely going electrical.

What’s not clear is how the brand new priorities will information authorities selections. For instance, will precedence sectors get first dibs on funding or infrastructure help? And can governments cease funding hydrogen initiatives as soon as it turns into clear they aren’t aggressive?

With out steerage on these and different questions, traders could discover it laborious to resolve the place to place their cash.

A nuanced view of exports

The 2019 technique was squarely targeted on exporting liquid hydrogen to potential patrons in Japan and South Korea.

Now, the likely big buyers are in Europe. In reality, Bowen at the moment introduced Australia and Germany are working in the direction of a A$660 million deal, funded equally by the 2 nations, to ensure European patrons for Australia’s inexperienced hydrogen.

Importantly, nonetheless, hydrogen may be very troublesome and costly to move. As my colleagues and I’ve written, Australia ought to as an alternative deal with utilizing hydrogen to supply inexperienced iron from iron ore.

The brand new technique treads a positive line on the query of exports. It identifies precedence sectors and goals to develop these new industries in Australia. But it surely would not rule out liquid hydrogen exports.

Getting communities on board

The 2019 technique emphasised the necessity for neighborhood acceptance of hydrogen applied sciences—notably in relation to security. Abroad expertise confirmed communities feared the chance of explosions and fires from this risky gasoline.

Security stays a significant concern within the technique. However the brand new model additionally emphasizes neighborhood advantages, reminiscent of jobs and extra numerous regional economies.

Particularly, the doc seeks to make sure correct session with First Nations individuals and to handle impacts on water.

Cart earlier than the horse?

This technique interacts with two measures the Albanese authorities introduced in latest months: the $2 billion Hydrogen Headstart grants program, and a tax credit for hydrogen producers.

The credit are solely obtainable for ten years, and there is nothing of their design to make sure they assist the precedence sectors. It might be a disgrace in the event that they have been taken up by producers pursuing hydrogen know-how that can by no means work.

Extra broadly, it isn’t clear whether or not these measures have been calibrated to attain the technique’s manufacturing and export targets. It is also unclear whether or not governments would pull the plug on help for applied sciences that develop into much less promising than first thought.

The place to subsequent

The hydrogen technique will likely be reviewed once more in 2029. Its success could be measured by expecting the next developments:

• massive hydrogen initiatives attracting finance and beginning development
• hydrogen suppliers signing multi-year contracts with customers, presumably together with exports
• the constructing of hydrogen storage services, and wind and photo voltaic farms to provide electrical energy for hydrogen manufacturing
• commitments and timelines from home heavy business to interchange fossil fuels with hydrogen.

If these indicators do not emerge within the subsequent decade, Australia might have to regulate its hydrogen technique, and international ambitions, accordingly.

This text is republished from The Conversation underneath a Artistic Commons license. Learn the original article.