Australia has been altering its perception of the energy industry for several years, with a focus on hydrogen as the future’s energy carrier. The plans are ambitious, aiming to become a hydrogen superpower and invest $14 billion in the development of this technology. Can Australia truly emerge as a leader in hydrogen production and utilization?

Hydrogen – the future of the energy sector

Hydrogen is considered a promising energy carrier that could play a significant role in transforming the energy sector. It is a clean and efficient element that can be derived from renewable energy sources. Furthermore, it can be stored and transported, making it a flexible solution for various sectors of the economy, including transportation, industry, and power generation.
Australia possesses immense potential for hydrogen production due to its abundant renewable energy resources, such as sunlight and wind. Additionally, its access to extensive gas and port infrastructure provides favorable conditions for global hydrogen exports. Consequently, the Australian government has decided to take ambitious measures and capitalize on this potential.
The government has announced a $14 billion investment plan to develop industrial-scale hydrogen production and expand the necessary infrastructure for hydrogen transport and storage. Canberra’s objective is to replace conventional fossil fuels in the transportation sector with their hydrogen equivalents, reducing reliance on oil imports and decreasing greenhouse gas emissions.

South Australia – the centre of the hydrogen revolution

That is the planned location of one of the largest hydrogen power plants in the world, expected to play a significant role in fulfilling the ambitious plans. Situated in the town of Whyalla, it is among the most crucial projects in Australia and is scheduled to commence operations by 2025. The power plant will utilize electrolysis technology, which employs electric current to separate water into hydrogen and oxygen. Whyalla holds immense potential for meeting the hydrogen requirements across diverse sectors of the economy.

Challenges and perspectives

Despite Australia’s ambitious plans, the hydrogen sector continues to face several challenges. One of the primary obstacles is the high cost associated with current available technologies for hydrogen production. Electrolysis, in particular, requires substantial amounts of electricity. However, the future development of new technologies and the scaling of production have the potential to reduce costs.
The influence of the coal lobby also plays a significant role in this context. Mining remains a cornerstone of the Australian economy, with bituminous coal ranking as the second-largest export product. Furthermore, coal mines provide employment for approximately 40,000 individuals, and the cities where these mines are located hold significant electoral importance for political candidates aiming to win elections.
Another challenge lies in the infrastructure necessary for hydrogen transport and storage. Expanding ports and establishing suitable transport systems are essential for enabling efficient delivery of hydrogen to customers.
Nonetheless, the prospects for sectoral growth are promising. Many investors and companies are keen on collaborating with Australia in the field of hydrogen technologies. The development of the hydrogen sector can contribute to increased exports and an improved trade balance for Canberra. Hydrogen is expected to become a vital commodity in the global energy market, and Australia may emerge as a key supplier to countries, particularly those with limited access to renewable resources.

Bartłomiej Haba