Features Australia

Hydrogen hot air

Picking losers in energy

4 June 2022

9:00 AM

4 June 2022

9:00 AM

When Prime Minister Anthony Albanese declared in his election victory speech that his new government would work to make Australia ‘a green energy superpower’, those who knew anything about the problems involved groaned aloud.

Australia is already a major power in energy markets as it has vast reserves of coal and natural gas that other countries want, despite all the talk about net zero, and which can be easily transported. Renewable energy is different. Every country can generate its own energy, with equipment imported from China, and it is far more difficult to transport over long distances.

Admittedly some countries have less space for such activities, such as Singapore, Japan and the UK, but renewable energy activists are full of ideas for offshore wind generators and even floating generators, or photovoltaic panels on every rooftop and never mind what happens in the rainy season. They also all want to be energy superpowers, or ‘the Saudi Arabia of wind’ as UK Prime Minister Boris Johnston put it when he announced plans to build yet more offshore wind turbines around the UK.

In other words, why would any country buy expensive energy from Australia when they can generate their own expensive energy, especially as the problems of transporting energy many thousands of kilometres from Australia wind farms and solar installations will add greatly to the cost of that energy?

This point was forcefully made by renewable energy advocate Andrew Blakers, a professor of engineering at the Australian National University, on the Conversation in early April. He says that the federal government has already set aside hundreds of millions of dollars to help create a major green hydrogen export industry, particularly to Japan, for which Australia signed an export deal in January. However, he also points out that Japan has more than enough solar and wind energy to be self-sufficient in energy and – assuming all that energy is harnessed – does not need to import either fossil fuels or Australian green hydrogen. Whether or not you agree with Professor Blakers that Japan can realistically meet all of its energy needs from local renewable energy the country can certainly generate hydrogen locally.

In fact, Japan is already doing so with a government-supported facility for producing hydrogen derived from a token 20 MW of solar power, which started operating in March 2020. (Major coal power plants generate 2,000 MW plus.) The resulting small parcels of the gas are shipped in hydrogen tube trailers to be used in stationary fuel-cell systems and in specially adapted cars and buses. This is hardly world shattering but it far more than Australia is doing at the moment. However, Japan has pledged to develop the first full-scale hydrogen supply chain and is interested in importing the fuel, having built the Suiso Frontier, the first ship in the world designed to carry hydrogen. This has shipped one load of hydrogen from Australia which was produced using steam and natural gas, the usual method of producing hydrogen for industrial processes and far cheaper than using electrolysis (sticking two bare ends of wire attached to the same power source into water).

The Suiso shipment in January attracted some media attention without the stories noting that the shipment only involved a test quantity of around 70 tonnes. A good-sized LNG carrier will take 72,000 tonnes. The exercise would also have represented a net power loss, for the process of making, condensing and shipping hydrogen is known to be technically challenging and wasteful.

Professor Blakers cites an estimate that converting energy to hydrogen, shipping it to where it is needed and then converting back into energy could consume 70 per cent of the energy generated. Michael Liebreich, a senior contributor to BloombergNEF (new energy finance) wrote in 2020 that as an energy storage medium, hydrogen has only a 50 per cent round-trip efficiency – far worse than batteries. As a source of heat, he estimates that hydrogen costs four times as much as natural gas. Hydrogen pipelines also cost three times as much as power lines.

Activists who talk so glibly about using hydrogen to store energy are no doubt thinking of liquid natural gas, which is now the basis of a thriving international trade using purpose-built container vessels. The international trade in LNG, in which Australia is a major player, started growing in the 1960s with the large-scale adoption of techniques for liquifying the gas in giant facilities called ‘trains’ and for keeping it liquid for long periods in what amounts to giant thermos bottles. LNG requires low temperatures, minus 160 degrees centigrade, but the gas itself is a source of energy and some of that energy can be used to power the liquification process. Once at that temperature the liquid form of the gas can be stored relatively safely at atmospheric pressures.

But hydrogen is not methane. It is a much smaller molecule so seals and pipes that would comfortably prevent methane leakage do not keep hydrogen in. The liquification temperature for hydrogen is also much lower, specifically minus 253 degrees centigrade or just 14 degrees above what physicists call absolute zero – you can’t get any colder – requiring considerably more energy to achieve and maintain. The Suiso Frontier cargo was liquified in a special facility that was powered from the grid. Hydrogen is also a considerably more dangerous gas than methane. Transmission lines are safer, but the same problem with demand arises. One group has been trying to raise interest in building a $16 billion transmission line from northern Australia to Singapore for years. But if the Singaporeans felt the need for intermittent energy why not take it from neighbouring Malaysia which also has all sorts of schemes to generate green energy and transmission would not be so expensive? While activists are on the subject, they could calculate just how much intermittent energy would have to be transmitted over the proposed line to justify the investment.

But as demonstrated by the suspension of senior HSBC executive Stuart Kirk by HSBC pending an internal investigation into a presentation he made at an event, the Financial Times Moral Money Summit, in late May, reality in renewable energy debate is not the issue. Kirk’s presentation, entitled ‘Why investors need not worry about climate risk,’ pointed out that most of the projections of economic loss due to climate change either have to fudge the figures or come up with numbers that are too small over the long periods involved to matter at all. Among other valid points in his presentation, Kirk likened the climate crisis to the Y2K bug that predicted a widespread computer glitch at the turn of the millennium and declared that ‘unsubstantiated, shrill, partisan, self-serving, apocalyptic warnings are always wrong’. But as far as the greens are concerned reality and economic analysis are simply not relevant.

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