Origin Energy inks ‘green’ hydrogen deal with Korean steel giant
Power and gas giant Origin Energy has struck a deal with one of South Korea’s biggest steel-makers to investigate future exports of zero-emissions hydrogen made from renewable energy in Tasmania and Queensland.
As countries around the world increasingly explore the potential of hydrogen in helping decarbonise their economies, Origin is working on several export-scale “green” hydrogen opportunities, including a 300-megawatt project in Townsville – using wind and solar – and a 500-megawatt green ammonia plant in Tasmania’s Bell Bay.
On Thursday, ASX-listed Origin said it had entered into a memorandum of understanding with Posco, a top steelmaker, to “cooperate on producing and supplying green hydrogen to Korea”.
The steel industry is a major driver of global warming, accounting for more than 8 per cent of the world’s emissions, because of the use of coal to generate the extreme temperatures needed to churn out liquid steel.
Amid rising pressure from governments and investors to decarbonise, steelmakers have begun examining options to remove coal from the process, including through the use hydrogen, a fuel that burns cleanly and emits only water.
When “green hydrogen” – hydrogen made via a process using renewable energy – substitutes coal in steelmaking furnaces, the end product is emissions-free.
The technology is not widely used due to significant cost barriers, however, a string of new pledges from big fossil fuel consumers China, Japan and Korea to achieve net-zero emissions by 2050-2060 has driven forecasts of hydrogen demand growing sharply in coming years.
Felicity Underhill, Origin’s general manager of future fuels, said Australia was in the “box seat” to become a major player in the potential global hydrogen boom due to its abundance of renewable energy resources and existing experience and supply chains for shipping energy commodities into key Asian markets.
“We are seeing significant demand for zero-carbon fuels from Asia from the 2030s and even sooner from Korea and Japan from the mid-2020s,” she said.“We’re looking forward to working with Posco to develop and export Australian green ammonia starting with a joint feasibility study.”
Andrew “Twiggy” Forrest’s Fortescue Metals Group, an iron ore miner, has laid out ambitious plans to build Australia’s first green-steel pilot plant later this year and a commercial plant in the “next few years”.
Dr Forrest last week said the shift to cleaner fuels would occur “almost violently” and suggested that the use of coal would disappear from the steel industry far sooner than many of Australia’s big coal shippers were forecasting.
“I don’t think there will be a coal-fired blast furnace in operation by 2050. Period,” he said.
Federal Energy Minister Angus Taylor has identified hydrogen as one of five “priority technologies” for future investment to reduce emissions and envisages Australia becoming a leading hydrogen exporter by 2030 after securing a $370 million fund for new hydrogen projects in 2019.
The investment plan is “technology neutral”, meaning funding from it is available to both “green” hydrogen – made from renewable energy – and “blue” hydrogen made from coal or gas while trapping the carbon emissions and burying them underground.
This has prompted concerns from some business leaders, renewable energy advocates and the ACT government that hydrogen projects could prolong the lives of coal- and gas-fired power plants and increase demand for fossil fuels that could instead be served by renewables.
Source: smh
