Increasing optimism for hydrogen
APGA National Policy Manager Andrew Robertson attended the CoAG Energy Council’s Hydrogen in Gas Networks Roundtable held recently in Melbourne. Here is his report.
Gas network stakeholders are increasingly optimistic about the future use of hydrogen in the energy system. Participants in the recent roundtable were full of practical advice on how to get things moving. Decarbonisation is the key policy driver but there is a sense that, with the right investments and regulatory settings, the hydrogen economy could be good for businesses and consumers in its own right.
Broad consensus emerged around the feasibility of the proposed hydrogen blending target of 10 per cent hydrogen in the gas networks by 2030. It is seen as easily achievable in practical terms and as a useful way to demonstrate hydrogen’s feasibility as a consumer energy source, and to encourage supply chain investments that will lead to cost reductions and greater hydrogen uptake over the long term. In fact, a key criticism is that 10 per cent by 2030 may be insufficiently ambitious.
One suggestion was to move the 10 per cent target forward to 2025, but there is some doubt as to whether 2025 is achievable – especially in relation to legislative timeframes. Legislation needed to underpin a mandatory 2025 target is unlikely to be in place before 2021, leaving just four years to achieve the target. A voluntary industry target could resolve the legislative timing-aspect of this issue, and there is still discussion to be had around whether a mandatory target is necessary.
A strong argument was also made that the notion of a specific blending target is itself misleading. It would, in practice, need to be a target ‘average’, to accommodate unavoidable but significant peaks and troughs in network hydrogen levels. A decision to instigate a 10 per cent ‘target’ will necessitate network and appliance standards that can cope with much higher levels e.g. 15-20 per cent; and a political and regulatory acceptance of the fact that, at times, the blend will also be much lower than 10 per cent.
All agreed that regardless of the details, the issue is becoming increasingly urgent as delays in setting the goal mean lost investment opportunities needed to make the hydrogen economy a reality.
Many Roundtable participants agreed that an eventual move to 100 per cent hydrogen in the gas networks is both likely and desirable. Technical challenges such as making the necessary adaptations to distribution networks and gas appliances were seen as eminently achievable. The use of existing transmission pipelines was recognised as being a potentially greater challenge with a number of technical uncertainties to be worked through. Other key challenges, such as where all the hydrogen for the 100 per cent scenario would come from, were not discussed (out of topic scope) – but may ultimately pose the greatest barrier.
Andrew will report on some of the other aspects of the discussion in his next report.