The time has come for green hydrogen in Australian manufacturing according to an enterprise resource software company executive.
SYSPRO Asia Pacific CEO Rob Stummer believes recent support from the Australian Federal Government will help pave the way for the future of local manufacturing in this country.
The process of creating hydrogen using clean electricity from renewable energy to electrolyse water (H2O), separating the hydrogen from the oxygen is energy intensive.
Long prohibitive to implement at scale given the costs involved, hydrogen is fast gathering support from scientists and policymakers following a recent $300 million investment from the Federal Government to help jumpstart hydrogen projects.
In a written statement, Stummer has said that if hydrogen can be produced here at under A$2 a kilogram, it will be able to play a key role in the manufacturing sector’s energy mix of the future.
“In 2018, it cost roughly $5 to $7 per kilogram to produce hydrogen, depending on the method used, according to the National Hydrogen Roadmap released in 2019. The roadmap said production costs would have to come down to between $2 and $3 to be more competitive with fossil fuel sources,” he said.
“Today, cheap and reliable fossil fuels power our manufacturing industry. This is not going to change overnight, but the manufacturing sector must prepare itself for a future where emissions are significantly lower than they are now. The Clean Energy Finance Corporation (CEFC) sees hydrogen as offering the most credible pathway to decarbonisation for high emitting sectors like manufacturing,” said Stummer.
The National Energy and Emissions Reduction Minister Angus Taylor is already on record having commited to building a hydrogen production industry, which is expected to create jobs and billions of dollars in economic growth over the next few decades.
For Stummer there is no question whether Australia can develop a hydrogen industry domestically.
The real opportunity for Australia, as he sees it, is to develop a major hydrogen export industry.
“Studies have shown the growing demand for hydrogen could result in an export industry worth $1.7 billion by 2030, creating 2,800 jobs mostly in regional Australia,” he said.
“The World Energy Council identified Australia as a ‘giant with potential to become a world key player’, while the International Energy Agency projected that Australia would be able to produce 100 million tonnes of oil equivalent of hydrogen, which could replace three percent of global gas consumption,” said Stummer.
At present, hydrogen is more commonly used as a raw material in the chemical industry for making methanol and is also used in the manufacturing of many polymers and petrochemicals.
But it’s in steel manufacturing where the direct reduction of iron ore could be developed into an important industrial process, according to Stummer, given the traditional blast furnace method discharges high levels of carbon.
“While direct reduction using natural gas is now widely used in steel production, new methods using hydrogen have only been piloted in the steel industry to date,” said Stummer.
In the electronics industry, hydrogen is widely employed as a reducing agent and as a carrier gas in the production of semiconductors. It is also used in the production of carbon steels, special metals and as a reductor agent in the metallurgic industry for metal alloying, for flat glass production and in the electronics industry where it is used as a protective and carrier gas for cleaning, etching and in reduction processes,” he said.
Stummer said rates of adoption would increase as long as pilot projects were followed with plans to action implementation across the manufacturing sector.
“I am not saying that hydrogen is the panacea for the manufacturing sector, but then neither is solar, offshore wind or battery storage,” he said.
“We need several and varied technologies if we are to decarbonise manufacturing successfully, but hydrogen looks highly likely to be playing a major role in manufacturing’s cleaner future.”