NZ in the box seat on hydrogen » The MacDiarmid Institute
NZ in the box seat on hydrogen

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NZ in the box seat on hydrogen

19 November, 2021

This article first appeared in Newsroom. 

New Zealand urgently needs to start using its rich renewable electricity resources to address the fact that 60 percent of our total energy supply comes from ‘dirty’ fossil fuels, including investing in ‘clean’ green hydrogen, an enabling chemical and fuel, Professor Sally Brooker argues

Comment: New Zealand is in the box seat to take advantage of making green hydrogen to produce commodity chemicals, provide energy, and reduce emissions.

The International Energy Agency (IEA) launched their new report on hydrogen at the G20 summit in Rome then took it straight to COP26 in Glasgow. The report finds that clean hydrogen (green hydrogen) can provide 10 percent of the world’s energy needs by 2050.

Share of total final energy consumption by fuel in the net zero emissions scenario

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The IEA predicts hydrogen will grow from less than 0.1 percent in 2020 to about 10 percent in 2050 of total world energy, if we are to meet the goal of net zero emissions by 2050. Figure taken from 2021 IEA report and slightly revised.

To do so, production of hydrogen will need to increase sixfold, from about 90 million to 530 million tons each year. 

Production also must convert from existing ‘dirty’ methods based on fossil fuels (forming ‘grey’ or ‘brown’ hydrogen), to low-carbon methods, either using carbon capture (CCUS or ‘blue’ hydrogen) or better still moving to produce ‘green’ hydrogen from water by electrolysis using renewable electricity (zero emission production).

Source of hydrogen production in the net zero emissions scenario

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The IEA predicts that if we are to meet NZE by 2050, hydrogen production will need to increase dramatically, and change from grey/brown hydrogen from fossil fuels, to low carbon emission hydrogen, CCUS/blue or electrolysis/green hydrogen. Figure taken from 2021 IEA report and slightly revised.

New Zealand is ideally placed to produce green hydrogen, especially if the Tiwai Point smelter is closed and the green Manapouri Power Station can be used for hydrogen production on a large scale.

Currently virtually all of the world’s hydrogen is used in the refining of fossil fuels and in industry. Almost all industrial consumption is for the production of ammonia (65 percent), methanol (25 percent) and direct reduced iron (10 percent).

Nearly all of the hydrogen used in these processes is brown or grey, so this must urgently be replaced by, ideally, green hydrogen, or at least by blue hydrogen. Note that the colours are just labels to indicate how dirty or clean they are – not the actual colour of the hydrogen.

In achieving net zero emissions, the IEA report predicts that demand for hydrogen for refining will drop but that the increased use in new greener heavy industry processes, for example the production of green steel, will more than offset that drop.

Furthermore, the new uses of low carbon hydrogen in heavy transport, power, production of ammonia as a fuel and of synthetic fuels, buildings and gas grid injection, is predicted to lead to the six-fold increase in hydrogen between 2020 and 2050 required if we are to achieve net zero emissions.

Hydrogen demand by sector in the net zero emissions scenario 

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The IEA predicts that to achieve net zero emissions by 2050, low carbon emission hydrogen (blue or green hydrogen) will be used in a far wider range of sectors, as it is a central, enabling, chemical in our low emission future. Figure taken from 2021 IEA report and slightly revised.

So where does New Zealand sit in all of this? We already have about 80 percent renewable electricity, well above the international norm. And, just as importantly, we have the potential to generate two-three times more renewable electricity than this, which is also key, as about 60 percent of our total energy supply currently comes from fossil fuels, most of which needs to be replaced by greener fuels.

The top priority is to use the green electricity as it is produced, but this cannot work in all sectors – for example, aircraft cannot be wired into the grid and flown. The intermittent nature of renewable energy is also an issue – we still want to be able to cook dinner when there’s no wind and it’s dark outside.

Hence the need to employ multiple methods to reduce emissions, and indeed to take a leaf out of nature’s book, and store some of this energy in chemical bonds, such as those formed when hydrogen is made from water.

Returning to the example of aircraft, storage of green electricity in batteries (small short haul) and in hydrogen (medium haul) will enable zero-emission planes on New Zealand’s domestic network. But, at least at present, the large long haul aircraft remain a challenge, and require liquid synthetic fuels (synfuels) to at least reduce net emissions.

Hydrogen is certainly not the only answer, but it is definitely a key part of the answer. It is an important chemical commodity, it enables energy storage, and it will play a central enabling role in decarbonisation of otherwise hard to abate sectors.

New Zealand is indeed in the box seat in this urgent energy transition. We could become a net exporter of green energy. These high value exports and associated skilled and well-paid jobs should be transformative.