Got gas: Can Australia still jump on the hydrogen bandwagon?
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The past week has seen self-admitted carbon emitter and iron ore magnate Andrew Forrest oust himself as a true believer in ‘green hydrogen’ – that is hydrogen produced using renewable energy – and is potential to address climate change.
In fact, Twiggy is so much of a believer that he has committed Fortescue Metals Group (ASX:FMG) to play its part in the green revolution by building green steel plants that could generate enough jobs to replace every job in the coal industry.
This is in stark contrast with the federal government’s plan or lack thereof to simply keep coal mines running for as long as there is demand.
He’s not alone either.
In August last year, UK steel billionaire Sanjeev Gupta flagged the potential investment of another 3,000MW of renewable energy projects in South Australia to support his plans to turn his Whyalla Steelworks into a green hydrogen steel hub.
But Australian isn’t the only country keen to jump on the hydrogen bandwagon.
In Germany, a consortium of Shell, Mitsubishi Heavy Industries, Vattenfall and Hamburg Wärme are planning to build one of the world’s largest electrolysers in the Port of Hamburg.
This will have a capacity of 100 megawatts and will be built on the site of former Moorburg coal-fired power plant.
Denmark is developing its own hub that combines large scale green hydrogen production with two large-scale energy storage solutions, underground hydrogen storage and compressed air energy storage.
Separately, Norwegian electrolyser maker Nel ASA is looking to reduce the cost of green hydrogen to just $US1.50 ($1.94) per kilogram by 2025 in a bid to outcompete fossil fuels.
That’s almost half of an Australian National University cost estimate of $3.18 to $3.90 per kilogram of green hydrogen that it released in a report last year.
Nel is looking to achieve this cost reduction by scaling the technology up to multi-gigawatt scale and growing production capacity.
So has Australia made it to the hydrogen party or did we miss the bandwagon?
It is still too early to tell, especially given that the market isn’t quite developed yet.
But there are promising signs that Australia has a very real chance to carve out its place in the sector.
Australian states have committed to plans involving hydrogen while junior companies such as ADX Energy (ASX:ADX), Global Energy Ventures (ASX:GEV), Real Energy (ASX:RLE) and Triangle Energy (ASX:TEG) are all progressing their hydrogen ambitions.
To top it off, Australia’s abundant sunshine makes it one of the best places for solar energy to reliably extract hydrogen from water.
With big guns such as Twiggy on board as well, there is every reason to believe that Australia might well be on the forefront of fuelling the future.