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Exporting Green Hydrogen│The Smart Export Series

Screen Shot 2022 07 29 at 2.21.30 pm EXPORTING GREEN HYDROGEN FROM AUSTRALIA
Where’s the opportunity? Green hydrogen is hydrogen generated by renewable energy or from low-carbon power. The production of this clean energy emits significantly lower carbon emissions than grey hydrogen. Australia is competitively placed to be a major global producer and exporter of green hydrogen, thanks to its abundant renewable resources and established ports for existing fossil fuel exports. Governmental support is also dedicated to make Australia a major supplier of green hydrogen globally. Australian government has already announced $500 million in funding to support hydrogen projects. In 2020, the federal government fast tracked approval for the world’s largest planned renewable energy export facility in the Pilbara region. Global hydrogen demand is predicted to continue growing, and by 2050, demand could vary from 150 to 500 million metric tonnes per year, depending on global climate ambitions and sectoral developments. Our Export Tips Product The majority of hydrogen produced worldwide is inexpensive grey hydrogen made from natural gas. However, as a clean energy alternative, green hydrogen is gaining traction for being a better long-term solution to help decarbonize economies. Applications of hydrogen as an energy source include transport, manufacturing or electricity production. Australian green hydrogen producers have an edge over foreign competitors for two main reasons: (1) possessing abundant natural resources to produce green hydrogen; (2) having a well-established connection with Asia’s major energy importers. Price Globally, although the cost of production of green hydrogen is expected to continue falling, it is still more expensive than conventional grey hydrogen: AU$4-12/kg for green hydrogen compared to AU$1.5~3/kg for grey hydrogen. Australian green hydrogen, costing between AU$4-7/kg, is at the low end of global ranges thanks to its abundant low-cost renewable resources. On the long run, competitive pricing could be a key advantage of Australian green hydrogen. Australian National University predict that, as cost of production falls, Australian green hydrogen could equal the price of conventional and grey hydrogen by 2030, which would be cost-competitive with both fossil fuels. Promotion Sustainability, flexibility and multi-usage capability are major values to communicate when promoting green hydrogen.
  1. Sustainability: Highlight green hydrogen’s sustainable production process of using renewable energy and sustainably sourced water, which in turn helps decarbonise future energy production.
  2. Flexibility: As a flexible energy source, green hydrogen can be used immediately or be stored and transported for later use.
  3. Multi-usage capability: Green hydrogen can (1) support domestic energy needs; (2) be used as a clean transport fuel; (3) provide electricity to the grid, and (4) offset the carbon from manufacturing processes in factories.
Industry events and conferences are also effective promotion channels: The Australian Trade and Investment Commission (Austrade) has led a delegation of over 25 Australian businesses to the World Hydrogen Summit in Rotterdam in May 2022 to showcase innovation in green hydrogen, providing a great opportunity to promote your products to foreign energy importers. Place Demand for Australian green hydrogen exports is expected to come from various countries currently importing Australian fossil fuel. In 2019, Australia exported almost AU$64 billion of black coal, mostly to Japan, South Korea, India and China. As these countries decarbonise, the coal industry will shrink, shaping green hydrogen as a high-potential replacement. Europe is also a key export destination. As the energy crisis stemming from the Russia-Ukraine war unfolds, Europe is aiming to cut its reliance on fossil fuels and embrace clean energy imports. The Port of Rotterdam (Netherlands) is seeking millions of tonnes of hydrogen imports in one of the world’s biggest projects to import and generate clean and transportable fuel. Among more than a dozen supplier countries, Australian green hydrogen is believed to have the most competitive price thanks to the cost profile of its renewable energy sources. Our Strategic Takeaways Australia is well placed to become a major producer and exporter of green hydrogen. The rich renewable resources and governmental green initiatives produce a conducive environment for Australia to supply competitively priced green hydrogen to various countries seeking alternative clean energy sources. To communicate the value of green hydrogen, consider highlighting its major benefits of sustainability, flexibility and multi-usage capability. Screen Shot 2021 02 26 at 12.20.51 pm