Special Report: Australia must start preparing for a future green hydrogen-driven economy, as experts weigh in on the technology’s growing cost-effectiveness at scale.
While the prospect of creating 100% emission-free energy is still in its relative infancy in Australia, Woodside Petroleum CEO Peter Coleman believes Australia should look no further than the rapid expansion of markets for gas and LNG in Japan and Korea as critical examples for why Australia must start preparing a consolidated framework for a green hydrogen future.
This would allow the country to overcome present limitations around cost and transportation as the deployment of green hydrogen becomes a critical part of Australia’s future economy, he said.
“The technology is there, we know what the cost curves are like [and] what we need to do in the market … but you’ve got to manage the energy input with the production [and] distribute [it],” he said at an address at the Perth Convention Centre this week.
“It’s going to be ten years in the coming, and we need to start now.”
Green hydrogen is made using an electrolyser to separate hydrogen from water, resulting in a fuel source without any carbon emissions, so long as the electrolyser is also powered by renewables such as wind and solar.
The potential surrounding green hydrogen is one that has got investors on notice, particularly after an agreement struck by Australia with Germany earlier this month saw a bipartisan commitment towards identifying and addressing “barriers for the development of a hydrogen industry”. At a regional level, the EU plans to build 6GW of green hydrogen electrolysers in the next four years.
Despite concerns about cost competitiveness, green hydrogen production in Australia is closer to reality than some might think. Enter ASX aspirant Infinite Blue Energy (IBE), one of the companies firmly behind Australia’s green hydrogen future.
IBE, who are targeting a $10 million IPO for 1Q FY2021, are fast tracking its plans to become Australia’s first commercial scale green hydrogen company and the largest in the southern hemisphere.
“The technology to produce green hydrogen is there, and the fervour around green hydrogen’s potential in Australia is at an all time high. All that’s left is to take the next step in scaling out green hydrogen production for it to become not only the cleanest form of energy, but the most cost effective too,” IBE chief executive officer Stephen Gauld told Stockhead.
With its $3 million pre-IPO funding round, Infinite Blue Energy is making strides towards helping Australia achieve its green hydrogen-powered future.
The company’s landmark Arrowsmith Hydrogen project will produce over 25 tonnes of 100% clean green hydrogen each day upon completion. It is targeting first hydrogen projection in 2022.
Gauld said he was really excited about the prospect for what possibilities green hydrogen can help Australia achieve, both in terms of fuelling job creation and significant reduction in the country’s carbon footprint.
“The federal government’s Technology Investment Roadmap announcement this week has been a shot in the arm for renewable energy in Australia, in addition to drawing a line in the sand of where the government’s priorities regarding renewable energy are,” Gauld told Stockhead.
This week’s second unexpected renewables champion is the world’s biggest carbon emitter: China. Chinese president Xi Jinping this week pledged to reach carbon neutrality before 2060, an even loftier goal than Australia’s own environmental commitments.
Woodside’s Coleman said the real tipping point for green hydrogen would be when China begins producing electrolysers at scale.
While Xi Jinping’s pledge didn’t mention how China plans to reach carbon neutrality, the door has been opened for green hydrogen players to get their feet in now and work towards scale with Australia’s largest trading partner.
This article was developed in collaboration with Infinite Blue Energy, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.