Australia has a National Hydrogen Strategy which supports all production sources that are capable of producing ‘clean hydrogen’. However, the definition of clean hydrogen is hydrogen produced using renewable energy or using fossil fuels with ‘substantial’ carbon capture and storage (CCS). Currently there are three main methods for producing hydrogen. These are:
- electrolysis (extracting hydrogen from water using electricity)
- thermochemical reactions using coal (coal gasification)
- thermochemical reactions using natural gas (steam methane reforming).
Producing hydrogen from electrolysis powered by renewable energy does not create any carbon dioxide emissions. However, producing hydrogen from coal or natural gas produces large carbon dioxide emissions and the only way this can be reduced is through CCS1.
While the coal and gas companies are enthusiastically embracing the production of hydrogen from coal or natural gas, their attempts to reduce the emissions through CCS have been less than stellar. CCS involves capturing, transporting and storing greenhouse gas emissions (mostly carbon dioxide and methane) from fossil fuel power stations, energy intensive industries, and gas fields by injecting the captured greenhouse gases back into the ground2.
In early 2018, I wrote a piece about the ethics-free zone that is Mathias Cormann and his lie that CCS was a proven technology for reducing greenhouse gas emissions. At that time, CCS was used almost entirely to enhance oil and natural gas recovery by injection into the reservoirs containing oil and natural gas, thereby actually increasing greenhouse gas emissions. When I wrote the article, I asked if, apart from enhanced oil and gas recovery, there was anywhere in which CCS operated commercially. The answer was “nowhere”3.
Four and a half years later, not much has changed. Worldwide, CCS trials on coal-fired power stations have been monumental failures. The few that have got off the ground have grossly exceeded budget and schedule, massively underdelivered on carbon promised to be captured, such that now most have been shut down2.
The largest CCS project in the world is Chevron’s Gorgon project, on Barrow Island off the coast of Western Australia, which the former Coalition government (that felt good, still) spruiked as a ‘flagship’ project. Attached to a gas plant plagued by leaks, which has to be frequently evacuated, the Gorgon CCS trial has been capturing less than half the emissions needed to make CCS viable, with the carbon dioxide injection project costing an estimated $2 billion. As of July 2021, Gorgon has reached a milestone, with five years of shortfalls on its emissions capture promises2.
Regulatory approvals for the huge Gorgon project were predicated on Chevron’s commitment to each year re-inject four millions of tonnes of CO2 stripped from its gas into porous sandstones some 2km under the island. However, Chevron has confirmed that having missed its carbon dioxide injection target for the 2020-21 financial year, Gorgon would report an “additional shortfall” for the five-year rolling average period to July 17, 2022. It means that Chevron will have to again cover the shortfall to meet its regulatory obligations, almost certainly by buying and surrendering greenhouse gas offsets. The $3.1 billion sequestration scheme has been closely scrutinised as a test case for the oil and gas industry’s arguments that CCS can be a game-changer in helping fossil fuel producers meet their carbon emission targets and slow global warming4.
The petroleum and coal companies can see the writing on the wall and are trying desperately, somehow, to keep the money flowing. This was also the reason behind former Prime Minister Morrison’s ludicrous ‘gas-led recovery’. He announced that expanding the use of gas – to be used in electricity generation, for heating and as a feedstock in some manufacturing – is central to plans to re-establish a strong economy after the coronavirus recession. He said in an address that there is “no credible energy transition plan for an economy like Australia that does not involve the greater use of gas”5. This was also just a plan for his donors in the gas industry to keep the money flowing.
You will also hear many people in the media and online spruiking nuclear power. This rears its head fairly regularly, but from my experience, seems a little bit more intense in recent months. I even saw one person saying that nuclear energy is cheaper than renewables, which is so much equine ordure.
South Australia held the Nuclear Fuel Cycle Royal Commission in 2015 to work out if nuclear energy was feasible. A federal parliamentary inquiry followed in 2019. The royal commission concluded nuclear power was out of reach. The federal inquiry recommended that any such project should only go ahead if there was broad support from the public – an extremely unlikely prospect. While both reports agreed that the ‘next generation’ reactors showed promise, nuclear power as a whole remained a time and money sink.
As of 2019, the cost of a nuclear power plant had risen to $1.4 billion for 100 megawatts (MW) of generation capacity. Construction of a commercial-scale plant would take at least 15 years. If Australia had started work on a nuclear reactor before the pandemic, it would not be in operation until about 2035. The small or ‘modular’ reactors that are held up as the future of the industry won’t be affordable until 20506.
Wind farms are being built all over Australia. One of the most recent efforts is the MacIntyre Wind Farm southwest of Brisbane. It will have 1,026 MW installed capacity and will cost $1.96 billion (i.e. about $190 million for 100 MW of generation capacity)7. This is only about one seventh of the cost of the nuclear power mentioned above. Large scale solar farms are being built all over Australia too. At the end of 2020, the cost of these was about $139 million for 100MW of generation capacity8, which is about one tenth of the cost of the nuclear power above.
The thing that upsets the energy mining crowd is that green hydrogen can be obtained from water and you don’t have to mine water. It is similar with hydroelectricity, all you need to do is to make sure your dams have enough water, and that mostly falls from the sky, so you don’t have to mine it. The energy miners are also upset that they cannot monetise the wind, nor can they monetise the sun. In general, they are upset that the fuel or feedstock for renewable energy is not something that they can dig up or suck out of the ground. It is an existential threat for them.