"We truly are at the dawn of a new industry that can contribute to jobs, export income, energy storage, and, vitally, global emissions reduction."

Following the delivery of the National Hydrogen Strategy in November, Dr Finkel shared his winding journey from hydrogen sceptic to hydrogen supporter. First published in The Age on 23 December, the full article is available below.

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Eight years ago when I was working for an electric car charging company, we did a calculation aiming to prove the benefits of battery storage.

We compared two hypothetical electric vehicles powered with the same initial amount of renewable electricity: one using hydrogen for storage and the other using batteries.

Our conclusion was that the battery electric vehicle could easily drive further. 

I became a hydrogen sceptic.

Years later, however, I learned about the advantages clean hydrogen offers in a range of scenarios: for long-haul heavy-duty trucks, trains and ships, for making green steel, for seasonal storage of solar and wind electricity in remote communities, and its unrivalled suitability for “shipping sunshine” – clean energy from Australia to the rest of the world. 

In short, I realised that hydrogen has the potential to fulfil a rich and complex set of low-emission roles.

I became a hydrogen convert.

However, my scepticism returned when I first heard of the suggestion to produce clean hydrogen from coal and natural gas using carbon capture and storage (CCS).

There is nowhere on Earth that you can drill a well and find hydrogen gas. To produce it, you must first extract it from water using either renewable electricity or fossil fuels such as natural gas or coal.

The production process determines the amount of carbon dioxide created.

When hydrogen is produced via the renewable electricity pathway (solar, wind or hydro) there are no carbon dioxide emissions.

But, when hydrogen is produced via the fossil fuel pathway, carbon dioxide is emitted as a by-product. It is therefore necessary to capture and store the carbon dioxide, deep underground, so that it does not escape into the atmosphere.

If hydrogen is produced today using electricity from a common household wall socket, the amount of carbon dioxide generated is very high (41 kg of carbon dioxide emitted per kg of hydrogen produced). 

On the other hand, if hydrogen is produced from either coal or natural gas, using best practice CCS, then the amount of carbon dioxide generated is very small (less than 0.8 kg of carbon dioxide emitted per kg of hydrogen produced).

My scepticism of CCS therefore stemmed not from its environmental impact, but from the knowledge that, despite decades of trying, it has not been commercially viable in the electricity generation industry.

The majority of today’s electricity generators burn fossil fuels to make steam that runs through a turbine to produce electricity.

The by-product is a mixture of nitrogen, carbon dioxide, and water collectively called ‘flue gas’.

To capture carbon dioxide from the flue gas requires additional equipment, and a considerable amount of energy and expense, due to inefficiencies associated with the flue gas being low-pressure.

Furthermore, in order to geologically store the carbon dioxide, it needs to be converted into a high-pressure steam that is then sequestered directly underground; again more costs.

But, I learned from researchers that CCS for hydrogen production is significantly more cost-effective for two crucial reasons.

Firstly, since carbon dioxide is left behind as a residual part of the hydrogen production process, there is no additional step, and little added cost, for its extraction.

And secondly, because the gas mixture at the output of the process is at much higher pressure than flue gases, the extraction of the carbon dioxide is more energy efficient and it is easier to store.

So I became a believer again, and was further comforted by the United Nations IPCC special report last year that spoke of the importance of CCS for mitigating emissions.

It is important to recognise that, as the world looks to massively increase its use of hydrogen, energy importing countries have been explicit that their interest is in ‘clean’ hydrogen.

And thanks to Geoscience Australia’s online ‘CCS Assessment Tool’, we know there are numerous suitable CCS reservoirs across the country.

Therefore, the concern that fossil fuel companies may promise to implement CCS for their prospective hydrogen production facilities, only to later renege on their commitment, is unfounded.

Investors in Australia know in advance — with extreme clarity — that operating any fossil fuel based hydrogen production project without high levels of CCS is a losing proposition.

For all these reasons, the National Hydrogen Strategy, unanimously adopted at a meeting of the nation’s energy ministers last month, takes the position that Australia should be a world-leader in developing a credible certificate of origin scheme – ensuring the clean credentials of every kilogram of hydrogen bought and sold can be verified, and providing an effective mechanism to deter dishonest practices. 

We know that this can be done robustly, based on our experience with Australia’s Renewable Energy Target scheme, where millions of renewable energy certificates have been traded with complete traceability and a high degree of confidence in the compliance and enforcement regime.

Of course, the more hydrogen we can produce from renewable electricity the better; but as we transition to a sustainable energy future, clean hydrogen produced from fossil fuels will add diversity to tomorrow’s energy mix, use fewer materials in the production plant construction, and likely be cost competitive.

We truly are at the dawn of a new industry that can contribute to jobs, export income, energy storage, and, vitally, global emissions reduction.

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The National Hydrogen Strategy was adopted by the Council of Australian Governments Energy Ministers in November.