Right now hydrogen is getting a lot of attention. Many countries are focusing on producing hydrogen for fuel, or
procuring it, or planning for its future use.
Hydrogen fuel is highly desirable - clean hydrogen produces none of the harmful emissions of other energy sources.
So hydrogen is potentially a very good energy source for powering our post-carbon world.
But there’s a catch - production of hydrogen is not economic at present and currently can’t be produced
cost-effectively.
As a result, countries are taking the initiative in different ways as they feel their way towards a hydrogen-powered
future.
This week the World Energy Council (WEC) released a report on hydrogen - Hydrogen on the Horizon: Ready, Almost Set, Go?: the BusinessNZ Energy Council, WEC’s representative in New Zealand, contributed to the report, along with 128 other
countries.
The report highlights the global activity that’s occurring in the development of hydrogen as a fuel source.
A number of countries in the Middle East, North Africa and the Americas are focusing on producing hydrogen. Others, in
Asia and Europe, are more focused on procuring it.
Their reasons for looking to hydrogen are varied - including its potential to diversify energy sources, decarbonise
economies, allow for repurposing infrastructure, and to grow green jobs and green economies.
Some countries - notably Germany, Japan, South Korea and Singapore - are partnering with others to ensure they can
achieve global hydrogen supply chains and adequate supply once hydrogen becomes cost-effective to produce in significant
quantities.
New Zealand is becoming integrated into such partnerships, signing bilateral partnership agreements with Japan and
Singapore and partnering with Germany on green hydrogen research projects.
New Zealand is also among the countries that are seeking ways to produce hydrogen cost-effectively.
Last week Contact Energy and Meridian Energy called for expressions of interest to develop a hydrogen production plant
in Southland. Their thinking is that a new hydrogen industry could potentially take up the excess electricity from our
bountiful, renewable hydro generation.
If the exploration of the potential for hydrogen as a cost-effective fuel is successful, it would be a wonderful
addition to New Zealand’s energy system as a whole.
New Zealand’s unusual energy profile, with our predominance of renewable hydro energy, would seem to be ideal for
producing hydrogen in the cleanest way possible.
Other forms of production, e.g. from nuclear generation, would be more problematic because of perceived safety or
environmental issues.
Perceptions around the method of hydrogen production are important, the WEC report says, because a key concern facing
energy policy makers is how to trigger demand.
WEC notes that the current hydrogen ‘conversation’ is heavily focused on supply, without paying much heed to the role of
hydrogen users. But it’s important to explore what’s needed to spark demand by consumers, including a specific focus on
the development of hydrogen infrastructure and a global supply chain.
So we are in an unusual situation: we have hydrogen producers trying to find a way to produce hydrogen fuel
cost-effectively, while at the same time energy policy makers are trying to prompt demand and get the hydrogen
infrastructure set up so they’re in place by the time that cost-effectiveness becomes a reality!
This shows the complexity of the task of achieving our post-carbon environment.
And it highlights the significant risks facing those companies that choose to invest in that task.
Companies investing hard-earned dollars in innovative, green business ventures are doing us a great service. For example
local company Hiringa Energy is currently working to establish a nationwide network of hydrogen refuelling stations to
be supplied by locally produced hydrogen.
We should watch this work with interest, along with the proposal for a hydrogen production plant in Southland and other
business ventures involving hydrogen here in New Zealand.
And we should take note of what other countries are doing as they feel their way towards an eventual global hydrogen
industry.
The way isn’t clear yet, but the fact that so many countries and companies are working towards the hydrogen goal gives a
great deal of hope.
Tina Schirr is Executive Director, BusinessNZ Energy Council