Green hydrogen: A KEY ELEMENT IN AUSTRALIAN MINERS’ DECARBONIZATION STRATEGY

MELODIE MICHEL, Reporter, Energy and Mines

Nowhere in the world is a government as committed to supporting the green hydrogen industry as in Australia. The country’s wide availability of solar and wind energy, and its proximity to potential hydrogen importers make it well-positioned to capitalize on the world’s energy transition — and it is not afraid of the investment needed to reap the full benefits.

In late 2019, Australia published its National Hydrogen Strategy, an extensive document outlining the different ways the government plans to support the development of a green hydrogen supply chain. A key part of this strategy is to support research, pilots, trials and demonstrations along the supply chain, including for remote applications, such as in microgrids for mining and remote communities. Part of this initiative involves financial backing from the Australian Renewable Energy Agency (ARENA) for such projects.

Speaking at the Energy and Mines Australia Virtual Summit, ARENA’s Investment Director Matthew Walden presented the agency’s Hydrogen Funding Round: up to A$70mn to be allocated to two or more large-scale hydrogen production projects. “The goal of the projects must be to demonstrate electrolysis at scale, provide a basis for price discovery, and facilitate pathway to technical and commercial viability,” he said.

In mid-July, ARENA disclosed the names of the seven companies shortlisted for the funding: APT Management Services, ATCP Australia, Australian Gas Networks, BHP Billiton Nickel West, Engie Renewables Australia, Macquarie Corporate Holdings and Woodside Energy. The final funding decision will be announced in early 2021.

The only miner in the shortlist, BHP, is focusing particularly on using green hydrogen to displace fossil fuels in mining processes. “Hydrogen provides an exciting opportunity with a diverse range of applications to our own operational requirements. It might provide a feedstock, heat source, energy storage medium or transportation fuel to satisfy the demands of our operations, “said Steve McGill, BHP Specialist Innovation, Sustainable Operations at the conference.

The company is currently studying the potential to supplement the existing hydrogen and oxygen demand with green hydrogen at its Nickel West Kwinana Refinery in Western Australia — the project shortlisted by ARENA. “We are exploring sizing configurations and optimizing the pairing of our electrolyzer load with variable renewable energy options both behind the meter and front of meter. This helps the world is a us on our journey toward sustainable government as nickel for the lithium-ion battery market,” McGill added.

Various other Australian miners have invested time and/or money in green hydrogen in recent years. At Fortescue Mining Group, the focus is more on using hydrogen to displace diesel in material movement, though the other applications are also seen as beneficial. “We have the ambition to use hydrogen to support our decarbonization efforts, and to develop a global scale green hydrogen business to help meet targets and to become a leading energy company,” explained Bethwyn Cowcher, Manager, Energy and Power (Strategy and Legal) at Fortescue Metals Group, during the Virtual Summit. “The use of hydrogen within our operations is focused on reducing reliance on diesel as a fuel, but we are also hoping to support the domestic industry and global supply chain.” Fortescue’s recently announced partnerships with the Commonwealth Scientific and Industrial Research Organization (CSIRO) and ATCO Australia both build on that ambition.

Both BHP and Fortescue, along with Anglo American and Hatch, are members of the recently announced Green Hydrogen Consortium, which plans to share learnings from the miners’ variety of projects to accelerate green hydrogen’s commercial adoption.

On the OEM side, there is a clear perception that demand from miners is there, and an urgent need to prepare for the day that green hydrogen is widely available at a commercially attractive price. For instance, in partnership with Fortescue, ATCO Australia is developing a combined hydrogen production and refuelling facility at its Jandakot Clean Energy Innovation But even those not Hub near Perth (also shortlisted by directly involved in ARENA), with the possibility of wider the development of deployment across the state.

At Wärtsilä Energy Solutions, there are watching is no denying that hydrogen is part of it unfold with the company’s future.

“R&D for hydrogen combustion is this technology is clearly on our roadmap,” explained the future. Loïc Chamoille, Business Development Manager, Wärtsilä Energy Solutions. “If production is king, you will still need thermal backup for your power supply, unless you have 24-hour storage. Thermal production fuelled with renewable fuel is a way to get to 100% renewables. The question is when will the market be ready for it, as the production of green hydrogen is still very far from viable. The massive efforts done in Australia are a great way to fast-track these developments.” He added that combustion engine efficiency is not expected to decrease with the use of hydrogen.

But even those not directly involved in the development of Austral- ia’s green hydrogen industry are watching it unfold with excitement — and expect to leverage this technology in the future. Presenting on the potential of electrified Mechanical Vapour Recompression (MVR) to decarbonize aluminium refining (which is responsible for 27% of Australia’s manufacturing emissions), Ray Chatfield, Global Technical Manager, Refining Energy at Alcoa pointed out that affordable green hydrogen would be a catalyst for its adoption in the industry. “Green hydrogen requires very low cost renewable power to realize Australia’s A$2/kg hydrogen target. If these renewable power prices are realized, it significantly improves the economics of MVR,” he said.

Others, like Mike Aire, Corporate Director of Environment at Newmont Resources, are closely watching the developments. “We feel that the cost trajectory is going to follow solar, wind and batteries. Hydrogen would be the ultimate solution to power fleets,” he said.

Whether it be for fleet decarbonization, fossil fuel replacement in thermal power generation, or cleaner processing, all miners have something to gain from green hydrogen. Australian miners in particular can count on government support to help them make this magic fuel a reality.