DEVONPORT, Australia, June 23 (Reuters) - Green hydrogen is
often touted as the future of energy, providing a flexible and
zero-emission fuel for transportation and electricity
The problem is how long will it take for that future to
An example of the immense challenges facing a hydrogen
future can be neatly encapsulated by looking at Tasmania,
Australia's island state that is seeking to become a global
leader in producing and exporting green hydrogen.
Hydrogen can be initially confusing as a veritable colour
palate is used to describe the various ways the fuel is
Green hydrogen is made using electrolysers powered entirely
by renewable energies, such as wind, solar and hydro.
This sets it apart from blue hydrogen, which is also touted
as a clean energy, but it's produced by using natural gas with
carbon capture and storage.
Grey hydrogen is made from natural gas but without the
carbon sequestration, while black and brown hydrogen is made
Tasmania has several advantages when it comes to getting a
jumpstart in producing green hydrogen.
It's electricity grid is 100% renewable, with the main power
provider, Hydro Tasmania, having a generation capacity of about
2.6 gigawatts (GW), which is more than double what it typically
provides to the grid at any given time.
Thee are also operating wind farms, and plans to add another
3 GW of new turbines.
To this add in the proposed Marinus Link, which is two new
connector cables to mainland Australia with a capacity of 1.5
If this development goes ahead it will allow Hydro Tasmania
to proceed with upgrading existing power stations to boost
output, as well as building a pumped hydro scheme to utilise
cheap, excess solar generation during the day to store water for
use during demand peaks.
The one thing that delegates to the Tasmanian Energy
Development Conference, held this week in the northern town of
Devonport, was that the stars are aligned for the state to
become a green hydrogen power house.
What is less certain is how all the various moving parts are
going to fit together, and the likelihood is that building a new
industry from scratch is going to take considerably longer than
many of the project proponents expect.
Creating a green hydrogen hub in Tasmania is likely to prove
far more complex than the massive expansion of Australia's
liquefied natural gas (LNG) sector over the past decade, with
more than $200 billion invested to make the country the world's
largest producer of the super-chilled fuel.
While the LNG projects were complex and involved multiple
layers of approvals, they were generally undertaken by a major
oil and gas company, with partners providing capital or sales
For Tasmania to fulfil its green hydrogen potential it will
take numerous companies working together to build renewable
generation, grid expansions and new connections, electolysers,
and new capabilities at the port of Bell Bay, where most of the
planned projects are likely to be located.
Not only do all these various players have to come together
and agree on terms, they then have to align their developments
so that the assets are all ready at more or less the same time.
Currently there are some major players looking at investing
in Tasmania, including Woodside Energy and Fortescue
Future Industries, a subsidiary of iron ore miner Fortescue
Woodside is planning to build a 300 megawatt electrolyser
plant to produce green hydrogen and ammonia, targeting a final
investment decision next year.
If it goes ahead that will exhaust the current spare
electricity available, meaning only one relatively project can
get up before new generation and transmission capacity is
TasNetworks, the state-owned grid operator, has had
expressions of interest for about 6 GW of electricity from
various hydrogen project proponents, a figure which a company
official said was beyond the capability of Tasmania to provide.
Even if all 3 GW of proposed wind generation is built, it
will only result in about 1.35 GW of additional power being
available, given a capacity factor of about 45% for wind.
This amount of available electricity would produce just
under 1 million tonnes of hydrogen or ammonia per annum, which
is a sizeable volume but still pales in comparison to
Australia's annual LNG output of around 80 million tonnes.
For hydrogen to reach the scale where it is a viable
alternative to Australia's coal or LNG exports, the investment
in renewable generation and storage solutions is going to be
massive, as well as hugely complex.
(Editing by Kim Coghill)