03/11/2019

Why The Coal Sector Is So Excited About Australia's Move To 'Clean' Hydrogen

ABC NewsJack Snape


Australian government video on national hydrogen strategy (ABC News)

Key points
  • Australia's national hydrogen strategy is due for completion by the end of the year
  • Hydrogen can be made using fossil fuels or renewables but it will be cheaper to use coal and gas for at least a decade
  • Japan's demand has been inflated in official government materials, overstating the short-term export potential
Japan might be endowed with many beautiful things but reliable and cheap sources of energy are not among them.
Home to 125 million people and one of the world's worst nuclear-power meltdowns, the allure of hydrogen energy has driven Japan's ambition to become a leading adopter of the energy source.
Next year's Tokyo Olympics will serve as a demonstration of the country's progress towards a so-called hydrogen society, based on carbon-free, next-generation technology.
It is keen for cars that produce exhaust — water — that technically could be drunk. The Olympics itself will be home to buses like this:
Toyota's Sora bus, to be used at the Tokyo Olympics, is powered by hydrogen fuel cells. (Supplied)
And key to its strategy for this clean-energy future is something that may surprise — Australia's brown coal.
Japan's strategic hydrogen roadmap, released earlier this year, states plainly that 2020 targets are set "assuming the success of Japan-Australia brown coal-to-hydrogen project".
That project, a trial using coal from Latrobe Valley in Victoria, will demonstrate how Australia's hydrogen export industry — and Japan's imports — might work.
But its prominence also hints at a tension threatening to tear the Australian hydrogen movement apart.

The recipe for hydrogen
Hydrogen is attractive as a fuel source because it carries more energy than natural gas and is carbon-free, so the burning of it does not contribute to climate change.
It can be produced by the process of electrolysis of water using large amounts of energy — think solar and wind-sourced — or chemical processes associated with combusting fossil fuels like coal and gas.
That sets up an ideological split between fossil fuels and renewables.
While the hydrogen itself emits no carbon when used, the cheapest way to produce it right now does.
Those preparing Australia's hydrogen strategy recognise the need to reduce emissions to combat climate change, and are only considering options using fossil fuels if they come with carbon capture and storage (CCS).
The most prominent examples of CCS involve pumping carbon emissions into underground cavities, but critics argue the technology is unproven and ineffective.
Mark McCallum at Coal21, a group representing black coal producers pursuing CCS, wrote in a submission to this year's hydrogen strategy consultation that the technology was proven, citing the example of the Norway's Sleipner 20-year-old project.
"Importantly, CO2 [carbon dioxide] is a stable substance and, provided the well-established industrial safety protocols are followed, the injection process can be conducted without any threats to the health and safety of workers or the public."
Suitable locations for hydrogen production, factoring in proximity to geology suitable for storing emissions, have already been identified by Geoscience Australia:
Infographic: Suitable locations for hydrogen production using fossil fuels. (Supplied: Geoscience Australia)
There may be issues with leakage from the emissions, or cost blowouts with rolling out the technology at a large scale.
But assuming there's not, it will be much cheaper to produce hydrogen using fossil fuels over the next few years.
However, the renewables-driven alternative is already better for the climate, and at some point after 2030 its price is also likely to be cheaper.

The 'inflated' prize of Japan
The briefing paper for COAG energy ministers notes "access to the Japanese energy market is the prize for the nations now bidding to be global hydrogen suppliers".
But it is not clear exactly how big that prize is.
Much of the hype around hydrogen in Australia focuses on the export opportunities.
The thinking goes that Australia could use its natural endowment in coal, gas, sun and wind and supply the world with hydrogen, starting with Japan.
This future, according to some, is just around the corner.
The first issues paper for the National Hydrogen Strategy trumpets: "High-level economic modelling by ACIL Allen estimates that hydrogen exports could provide around $4 billion direct and indirect economic benefits to Australia by 2040 under medium demand growth settings."
Under those "growth settings", consultants ACIL Allen estimate that Japan will need 1.76 million tonnes of hydrogen per year in 2030. It suggests Australia could provide 368,000 of those tonnes.
Infographic: ACIL Allen's figures for demand, shown here in thousands of tonnes per year, have been brought into question. (Supplied: ACIL Allen)
If ACIL's estimates are correct, more than 2,000 Australian workers will benefit from the burgeoning industry in the next decade.
However, Japan's own strategy projects its own demand in 2030 at just 300,000 tonnes. That's less than one fifth ACIL's estimate of Japan's consumption.
Anthony Kosturjak, a senior research economist at Adelaide University, said the ACIL estimate "does seem optimistic".
"The low-export scenario of 182,000 tonnes is more reasonable as this would represent about 60 per cent of the national target," he said.
Mr Kosturjak, who researched 19 national hydrogen plans this year for a research paper funded by the Department of Industry, warned that Japan's targets were aspirational but also competition was intense, noting Japan had set up projects in other countries, including Brunei and Norway.
"It is important to remember that the Japanese strategy identifies an aspirational target and there is significant uncertainty regarding how the technical and economic feasibility of hydrogen and competing technologies will evolve," he said.
"As such, the country could significantly overshoot or undershoot its target."
According to ACIL's estimates, Japan will provide the majority of world demand in 2030.

How a boom changes the strategy
John Soderbaum, director of science and technology at ACIL Allen, said the scenarios in the report "are not forecasts of hydrogen demand by any particular country, rather they are projections of the potential overseas demand for hydrogen under three different scenarios".
"We then explored what it would mean for Australia in terms of export revenues and employment if that projected overseas demand for hydrogen imports was met in part by Australian exports."
However Richie Merzian, the director of the climate and energy program at left-wing think tank The Australia Institute, described the numbers as "inflated" and argued they were being used to justify fast-tracking the hydrogen export market.
"Public money is being channelled into developing coal and natural gas-based hydrogen plants," he said.
"With time and public funding, green hydrogen, derived from water through electrolysis and powered by renewable energy, could provide a far more sustainable industry."
Chief scientist Alan Finkel.
While such an industry may be more sustainable, its success means a lost opportunity for Australia's coal sector — and its workers — to pivot towards hydrogen.
In August, Australia's chief scientist Alan Finkel argued a combination was desirable.
"Producing hydrogen from these [fossil fuel] sources, if done in conjunction with carbon capture and sequestration, is an attractive option because it increases the diversity of supply (so all our 'eggs' are not in any one energy 'basket')," he said.

Crunch discussions loom
Much has been made of Australia being perfectly placed to take advantage of hydrogen, with wind, sun, vast reserves of coal and gas, and access to Asian markets.
And there appears to be support from all sides of politics.
In January, then Opposition leader Bill Shorten unveiled a hydrogen strategy for Labor that was backed by the Minerals Council.
But success is not automatic.
Research by the International Energy Agency shatters the mythology that Australia is the standout leader for hydrogen production.
Infographic: Hydrogen production costs in different parts of the world. (Supplied: IEA)
The US, China, north Africa and the Middle East appear to offer substantially cheaper production.
Dr Soderbaum said ultimately the market would decide whether Australia's hydrogen sector got off the ground.
"At the end of the day, the actual demand for Australian hydrogen will be determined by factors such as the economic competitiveness of our supplies versus those of competing suppliers of hydrogen around the world and the extent to which it can be classified as low or zero-emissions hydrogen," he said.
The national hydrogen strategy is currently being drafted by a taskforce led by Dr Finkel.
State and federal energy ministers are expected to discuss the strategy in November.

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Climate Change Caused The World’s First Empire To Collapse

ForbesDavid Bressan

Inscription in Akkadian on a brick-stamp of baked clay of King Sarkali-Sarri of the Akkadian dynasty, Nippur. From the Archaeological Museum's collection, Istanbul. Photo by CM Dixon/Print Collector/Getty Images
The Akkadian Empire was the first ancient empire of Mesopotamia, centered around the lost city of Akkad.
The reign of Akkad is sometimes regarded as the first empire in history, as it developed a central government and elaborate bureaucracy to rule over a vast area comprising modern Iraq, Syria, parts of Iran and central Turkey.
Established around 4.600 years ago, it abruptly collapsed two centuries later as settlements were suddenly abandoned.
New research published in the journal Geology argues that shifting wind systems contributed to the demise of the empire.
The region of the Middle East is characterized by strong northwesterly winds known locally as shamals. This weather effect occurs one or more times a year. The resulting wind typically creates large sandstorms that impact the climate of the area.
To reconstruct the temperature and rainfall patterns of the area around the ancient metropolis of Tell-Leilan, the researchers sampled 4,600- to 3,000-year-old fossil Porites corals, deposited by an ancient tsunami on the northeastern coast of Oman.
The genus Porites builds a stony skeleton using the mineral aragonite (CaCO3). Studying the chemical and isotopic signatures of the carbon and oxygen used by the living coral, it is possible to reconstruct the sea-surface temperature conditions and so the precipitation and evaporation balance of a region located near the sea.
The fossil evidence shows that there was a prolonged winter shamal season accompanied by frequent shamal days lasting from 4.500 to 4.100 years ago, coinciding with the collapse of the Akkadian empire 4.400 years ago .
The impact of the dust storms and lack of rainfall would have caused major agricultural problems possibly leading to famine and social instability.
Weakened from the inside, the Akkadian Empire became an easy target to many opportunistic tribes living nearby.
Hostile invasions, helped by the shifting climate, finally brought an end to the first modern empire in history.

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Opinion: Five Reasons Climate Change Is The Worst Environmental Problem The World Has Ever Faced

Los Angeles TimesChristopher Knittel

The chemicals that cause smog can be directly linked to the brown air people see, and solutions can be crafted on a local basis. With climate change, there aren’t clear smoking guns that can be linked to specific events. Lawrence K. H / Los Angeles Times
Christopher Knittel
Christopher Knittel is a professor of applied economics at the MIT Sloan School of Management and director of MIT’s Center for Energy and Environmental Policy Research.
Even now that most of the world has acknowledged that climate change is real and caused by humans, combating it has proved daunting. Why? There are five features that combine to make global warming a more vexing environmental crisis than any we have faced before.

One
First, the pollutants that contribute to it are global pollutants, ones that do their damage no matter where on earth they are released. Past pollutants — such as sulfur dioxide, which causes acid rain, or nitrogen oxides, which are a precursor to smog — are local pollutants, which do most of their damage near where they are released. Elected officials are much more likely to enact measures to curtail local pollutants, because the voters who elect them are directly affected by the pollution. With global pollutants, much of the damage is felt far away, and moreover, they may not be something an elected official can control through local action.

Two
The second complicating feature of climate change pollutants is that much of their damage is in the future. The electorate and their public officials have less reason to pass measures that would cost money and cause inconvenience now, when the most severe damage will accrue to some distant and unknowable future.

Three
The third issue is that the pollutants producing climate change can’t be directly linked to a smoking gun. Whereas nitrogen oxide emissions directly created smog, which was easily seen, climate change pollutants lead to more frequent bad events, but these events also can and do occur naturally. We can chart, over time, that hurricanes are getting wetter and more damaging or that drought cycles last longer, but those observations are easily dismissed by those who wish to downplay the problem, since weather has always been variable. Rising average temperatures too can be ignored, because there have always been record-setting days and heat waves.

Four
The fourth feature that makes climate change particularly daunting is that developing countries contribute a large share of the pollution that drives it. This is important for several reasons. It is difficult for developed nations to make the case that the same technologies that made their own growth possible should now be denied to the countries coming behind them. And it is hard for policy makers in developing countries to justify incurring the costs of reducing global pollutants when their citizens still struggle with getting enough to eat or having access to clean water.

Five
The final characteristic making climate change such a thorny problem is that the pollutants causing it are tied directly to crucial aspects of people’s lives, including transportation, home electricity, and heating and air conditioning. Moreover, alternatives still tend to be more costly.
Some past environmental problems offered far easier solutions. The pollution that caused the hole in the ozone layer, for example — chlorofluorocarbons — were also a global pollutant and were tied to widely used products such as refrigeration, air conditioning and hairspray. But there were cheap, readily available alternatives. That’s not the case with the petroleum products we use to power our cars and the natural gas and coal still widely used to generate electricity. Yes, alternatives are being developed, but they are often more costly and haven’t been widely adopted worldwide.
If an evil genius had set out to design the perfect environmental crisis, one that would slowly destroy the earth through humans’ own actions and would be difficult to fight, those five factors would have made climate change a brilliant choice. But we didn’t need an evil genius. We stumbled into it on our own.

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