Hydrogen: The Low-Cost Clean Fuel That Could Lower Energy Prices
According to a recent opinion piece published in The Sydney Morning Herald, Australia should be working towards a renewable hydrogen future. Written by Darren Miller, chief executive of the Australian Renewable Energy Agency (ARENA) and keynote speaker at the recent All Energy Conference, the opinion piece focused on the many benefits of investing in renewable hydrogen, both for the Australian economy and for everyday Australian’s battling skyrocketing energy bills.
But what is hydrogen? How can it be a source of renewable energy and why is everyone so excited by its future prospects? Simply put, hydrogen is an incredibly versatile form of fuel. It is created using electrolysis, which detaches the hydrogen from the oxygen naturally found in water molecules. Hydrogen can be easily exported, converted into much-needed electricity or stored in existing gas pipelines. Better still, hydrogen can be produced with zero carbon emissions if the electrolysis is powered by solar or wind power.
Sounds almost too good to be true, right? So, if hydrogen is such a great product, why aren’t we using it now? Put simply: money. With current technology, it’s still cheaper to rely on natural gas or fossil fuels, so that’s what the energy sector is doing. But this doesn’t mean that renewable hydrogen is just a pipedream – large-scale solar power used to be prohibitively expensive, but in the last 10 years the cost has dropped to just a tenth of what it used to be. Similarly, renewable hydrogen has the potential to become cost-efficient within the next few years – if it receives support in the form of ongoing research and development within the renewable energy sector.
ARENA feels that Australia is well situated to become a major exporter in renewable hydrogen, thanks to our already established reputation as an energy exporter and the potential for wide-scale wind and solar farm expansion throughout remote and regional parts of the country. This kind of investment would provide an employment boost for many regional communities through the construction and ongoing operation of wind and solar farms, as well as coastal electrolysers.
But while this kind of investment could provide a boost to the economy, of far greater interest is the potential for hydrogen to lower energy prices for residential properties and small-business owners. The current energy supply situation in Australia is very rigid – big industries operate around the clock while solar and wind farms can only produce power under the right conditions. Grids are often overwhelmed during peak operation times, such as in the evenings when everyone gets home from work and turns on their air conditioner or heater. But electrolysers can operate during the day when the sun is at its peak and switch off during peak evening times. The cost to produce the energy will be lower and the cost of storing the energy will be lower – therefore, the cost to supply the energy should also be lower. Not only that but as an emissions-free fuel source, the cost to the environment would be far lower too.