State of Hydrogen report shows progress stalling on green push

The State of Hydrogen 2022 report, released on Thursday provides a snapshot of the nascent hydrogen industry in Australia.

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The annual report identifies the pace at which the hydrogen industry is progressing towards a range of goals by 2025 and 2030.

While the pace has increased in electricity grid support and electricity generation, the pace has slowed in investment, project scale, cost competitiveness, chemical feedstock, gas networks and industrial heat.

Critically for the Illawarra, the report identifies the areas of steel and iron making and transport as advancing slowly, the two areas where the region is expected to play the largest role.

Climate change and energy minister Chris Bowen said Australia had work to do to speed up hydrogen projects.

"The world's climate emergency is Australia's jobs opportunity, and the Albanese Government is moving quickly to make sure we seize that opportunity in green hydrogen," he said.

"Australia's regions have the resources, technical skills and track record with international partners to seize this opportunity and become a global hydrogen powerhouse, we need to make sure we don't get left behind as the rest of the world moves."

Energy expert at the University of Wollongong, Ty Christopher, said global investment in hydrogen had accelerated, in some cases leaving Australia behind. Following the invasion of Ukraine by Russia and Europe's desire to no longer be reliant on Russian gas for energy, investment in hydrogen had soared on the continent. At the same time, US President Joe Biden's Inflation Reduction Act has turbo-charged investment in hydrogen as a local fuel to reduce emissions.

"Those two areas are the underlying reason for that slowing in investment [in Australia," Mr Christopher said. "Within that, there's a salient lesson for the Australian government and that is, if we want to be a hydrogen superpower, then the federal government needs to match what's going on to make sure that Australian companies aren't incentivised to move [overseas]."

The Illawarra's push towards hydrogen as a fuel for transport picked up with the NSW government's announcement of funding for a hydrogen production and refuelling station in Cringila. However, with hydrogen thought to be the most promising way to decarbonise steel production, Mr Christopher said it was "disappointing" that the NSW government did not support a hydrogen electrolyser proposed by BlueScope.

"Between 80 and 90 per cent of the carbon footprint of the Illawarra is the BlueScope steelworks, to have any initiatives such as green steel make the shortlist and then not be funded frankly beggars belief."

Coinciding with the industry snapshot report is the release of the National Hydrogen Infrastructure Assessment (NHIA). Prepared under the federal government's National Hydrogen Strategy, the report outlines the infrastructure needed to support a hydrogen industry in Australia.

The report identifies Port Kembla as one of the few locations around Australia that has the potential for domestic and export demand, along with other significant industrial hubs such as Geelong, Gladstone and Newcastle.

The Illawarra, however, was not included in the hydrogen hub strategy released by the previous federal government, something that Mr Christopher said should change.

"The focus at the federal level on hydrogen hubs has been about spreading the Vegemite on an even thickness, one per state," he said.

"Economically NSW is the lynchpin of the national economy, it's not unreasonable to expect that NSW would have two hydrogen hubs. When you make any non-political assessment of the bare facts, Port Kembla and the Illawarra come up at the top of the list as a location for a hydrogen hub."

To decarbonise hard to abate sectors such as steel and fertiliser manufacturing, heavy transport and aviation, while also playing a role in the global demand for green hydrogen, five hundred electrolyser plants in 36 hydrogen regions would be required, analysis by National Energy Resources Australia based on the NHIA modelling finds.

Investment in the hundreds of billions of dollars would be required and hundreds of thousands of workers would be needed to rapidly scale up hydrogen infrastructure and build the renewable energy generation needed to supply power to electrolysers.

Currently only small scale demonstration plants for green hydrogen exist in Australia, so the scale and pace of change required may seem insurmountable. But, as Mr Christopher points out, the rapid development of the oil and petroleum industry and its integration into all aspects of our lives could barely be imagined 100 years ago.

"We can't afford for it to take 100 years to get to where we need it to be, but look through the lens of it taking 20 or 30 years, and it becomes a lot more sensible, practical and do-able, if you look at the history that got us to where we are with the fuel network that we have now."

Amid the reports and snapshots, on Thursday the Australian Renewable Energy Agency announced $50 million for research and development for renewable hydrogen and low emissions iron and steel.

Member for Cunningham Alison Byrnes said the funding would go towards the decarbonisation of Illawarra industry.

"I encourage all parts of the steel supply chain to consider working with research institutions, like the University of Wollongong, to find new ways to reduce our steel production emissions," she said.

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