• Oli Capital

BP says Australia is an ideal place to scale up green hydrogen production

Updated: Oct 19, 2021

A bp Australia study partially supported by the Australian Renewable Energy Agency has confirmed the technical feasibility of large-scale renewable hydrogen and ammonia production for export in Australia, particularly in Western Australia’s Mid-West. However, the development of such an industry, says bp, requires strong government policy support, including a carbon price or emissions cap.

bp Australia has concluded its $4.42 million “Renewable Hydrogen and Ammonia Feasibility Study” (the Study), supported by the Australian Renewable Energy Agency (ARENA), Lightsource bp and GHD Advisory, confirming that “production of green hydrogen and ammonia using renewable energy is technically feasible at scale in Australia”, and identified Western Australia (WA) as the ideal position for this production.

The technical feasibility of export-scale green hydrogen and ammonia production in Western Australia is due to WA’s “vast potential solar and wind resources, existing infrastructure and proximity to large, long-term markets.”

However, the Study, which evaluated the techno-economic potential of pilot and commercial-scale green production plants as part of Project GERI (Geraldton Export-Scale Renewable Investment) in Geraldton, WA, also found that significant infrastructural investment in ports, water and electricity networks and distribution would be necessary for the development of a green hydrogen export industry.

What is more, the markets of hydrogen and ammonia need development themselves, particularly general hydrogen fuel use as it still requires significant scale before it can be commercially viable. Ammonia, of course, is already traded globally at scale.

A major player in fossil fuels, BP says it’s aiming to become a net-zero company by the year 2050 or before. Among other things, the company wants to invest in and build 50 gigawatts of renewable energy capacity by 2030. Australia is a “leading exporter” of both coal and liquefied natural gas, according to the International Energy Agency.

Currently, the vast majority of hydrogen generation is based on fossil fuels, and green hydrogen is expensive to produce. The last few years have, however, seen an increasing number of major companies take an interest in the potential of hydrogen.

Just last July, the CEO of Italian infrastructure firm Snam outlined a vision for the future of hydrogen, saying the “beauty” of it was that it could be easily stored and transported.

While there is excitement about the potential of hydrogen, it has some work to do in the years ahead.

Enel CEO Francesco Starace said there was “no competition for capital between hydrogen and renewables, and hydrogen today is a niche that will require significant efforts in r&d, prototyping and pilot plants to grow to commercial standards and large industries at competitive prices.


2 views0 comments