W. Australia sees promises, pitfalls for hydrogen

The Chamber of Minerals and Energy of Western Australia reported November 24 that the use of hydrogen during the energy transition has support from investors, though there is a degree of uncertainty for where it fits in the energy mix.

Paul Everingham, the CEO of the chamber, said hydrogen has the opportunity to grow in the state and national market, but success is far from certain. State and federal measures are not on par with international competitors and industrial developments so far are not primed to overcome some of the economic and technological challenges for a hydrogen market.

“Furthermore, legislative and regulatory reform is often uncertain and opaque, and hydrogen policies are not fully integrated into an energy systems and economy wide abatement framework,” he said.

The chamber found that blue hydrogen – processed using natural gas, steam reformation and associated carbon capture and storage – may make more sense now than green hydrogen, which uses an electrolyser powered by renewable energy to break water into its elemental components.

“The blue hydrogen narrative is different, with blue hydrogen being more competitive today and arguably serving as a transition to the time when green hydrogen technology is more widely used,” the chamber’s report read.

Fortescue Future Industries (FFI) secured planning approval earlier this month from the state government in Queensland to build a hydrogen equipment manufacturing facility.

It will be the first facility in Australia able to make the multi-gigawatt-scale electrolysers used worldwide in hydrogen production. It is expected to be the largest electrolyser factory in the world when it comes online in 2023.

Meanwhile, the chamber developed its work using a study from Australian Venture Consultants, which found “there is yet no clear consensus on the role or scope of hydrogen within the future of the global energy mix.”

But even still, the Western Australia group said hydrogen has a clear role in the energy transition and can help industries and governments alike reach their climate goals.

“A focus on hydrogen is also spurred by changing investor sentiment toward companies that are geared to greenhouse gas intensive activities,” it added.

The state government set a goal of having hydrogen on the state gas network and have a refuelling factor available in Western Australia by next year. By 2030, the state envisions a global hydrogen market share similar to what it already enjoys for LNG.