Australia is well-positioned to take a lead in the emerging hydrogen export market with abundant low-cost renewable solar and wind energy, coupled with existing expertise in natural gas infrastructure and shipping.
"Global demand for hydrogen is set to increase substantially over coming decades.”
From an energy perspective, hydrogen has two outstanding properties: it is an excellent carrier of energy, with each kilogram of hydrogen containing about 2.4 times as much energy as natural gas; and from an environmental perspective, hydrogen is unique among liquid and gaseous fuels in that it emits absolutely no carbon dioxide (CO2) emissions when burned.
The obstacle to realising hydrogen’s clean energy potential is it is virtually non-existent in its free form on earth. Energy must be used to liberate it from the material forms in which it exists, such as water, biomass, minerals and fossil fuels. The sourcing of this energy to create hydrogen is critical to realising its potential.
The energy contained within hydrogen can then be released as heat through combustion or as electricity using a fuel cell. In both cases the only other input needed is oxygen - and the only by-product is water.
Japan drives hydrogen demand
Global demand for hydrogen is set to increase substantially over coming decades, driven by Japan’s decision to put imported hydrogen at the heart of its economy.
In the broader region, demand for imported hydrogen in China, Japan, South Korea and Singapore could reach 15.8 million tonnes in 2040 according to estimates from consultants Acil Allen, representing huge opportunities for Australia given its proximity to those potential markets.
Global demand for hydrogen is now about 55 million tonnes (Mt) a year (with the same energy content as 132 Mt of LNG). By comparison, Australia exported 60 Mt of LNG in the 2018 financial year, almost all of it is used to refine oil or produce ammonia and other chemicals for the production of fertilisers and plastics.
Currently, the supply of hydrogen comes from production processes that release CO2 into the atmosphere; as such there is significant carbon abatement potential if existing processes are replaced by green or renewable hydrogen.
Hydrogen’s versatility means it can play a key role across all energy sub-sectors. It can be used as an exportable zero-emissions fuel, burned to provide heat for buildings, water and industrial processes, and also power transport through fuel cells, being particularly suitable for long-haul heavy transport.
Hydrogen can help make the entire energy system more resilient by providing a flexible load, frequency control services and dispatchable electricity generation.
Due to its potential for decarbonising energy systems, many countries around the world are investing to develop hydrogen energy value chains. Japan and South Korea, which depend heavily on imported fossil-fuel energy and nuclear energy, are seeking to replace those fuels with imported hydrogen. The Fukushima nuclear disaster in Japan in 2011 has served as a lesson to governments around the world to seek safer and cleaner fuel sources.
In these markets, the key end uses for hydrogen are:
- Powering fuel cell vehicles including heavy haulage trucking fleets.
- Large-scale electricity generation.
- Decarbonising natural gas networks by replacing methane with hydrogen.
- Producing electricity and heat in residential fuel cells.
Road transport is responsible for about 15 per cent of carbon emissions globally, with rail, sea and air transport accounting for 3 per cent. Ultralow emissions vehicles – battery electric vehicles (BEV) and fuel cell electric vehicles (FCEV) – are therefore key to reducing emissions.
Both BEVs and FCEVs use an electric drivetrain. In BEVs, electricity from an external supply charges a battery, which in turn supplies electricity for the motor. In FCEVs, electricity for the motor is generated by a fuel cell using hydrogen. Both vehicle types produce zero tailpipe emissions, making them ideal for combatting air-quality issues in urban environments.
All the colours
The most common production methods are to split water molecules into hydrogen and oxygen using electricity or through a thermochemical reaction using fossil fuels. The hydrogen is compressed for transmission to where it is needed while the oxygen is harmlessly released into the atmosphere. The energy to produce the hydrogen is subsequently released at the point of use. As such, hydrogen is technically an energy carrier rather than an energy source.