Queensland may be the site of the world’s largest green ammonia plant, with ARENA committing $2.8m in funding to examine the feasibility of producing ammonia using hydrogen generated with water instead of natural gas.
Making hydrogen using electrolysis, a water-based method, has been touted worldwide as a potential solution to decarbonise the economy, as hydrogen is a zero-emission fuel when burned with oxygen. This project will not use the hydrogen as a source of energy but will combine it with nitrogen to produce ammonia.
Electrolysis can use renewable energy, such as solar, to split water into oxygen and hydrogen, with the only by-product being water vapour. By comparison, the natural gas method emits carbon dioxide (a greenhouse gas) when the methane is reacted with steam.
The $2.8m covers two renewable hydrogen energy projects in Queensland, with $1.9m in funding going to Queensland Nitrates, for its ammonia production plant, and $980,000 earmarked for Dyno Nobel, a dynamite manufacturing company founded by Alfred Nobel.
Dyno Nobel is examining whether its Moranbah facility can produce ammonia with zero-carbon hydrogen generated from a 160MW electrolyser and a 210MW solar farm instead of natural gas.
Queensland Nitrates (QN) will determine the feasibility of using 3,600 tonnes of renewable hydrogen to produce 20,000 tonnes of ammonia at its Moura plant, potentially reducing its natural gas usage by 20 per cent, according to the Department of the Environment and Energy.
The ammonia produced in Queensland is primarily deployed as a blasting agent by mines in Queensland’s Bowen Basin coal fields.
“Given ammonia production is an energy-intensive industry that accounts for one per cent of global emissions, this project could also help the ammonia industry to reduce its emissions by switching to renewable hydrogen,” ARENA CEO Darren Miller said.
The funding follows the release of a
Geoscience Australia report
last week that said Australia can support a large-scale hydrogen industry to help decarbonise its energy systems.
The
Future Fuels CRC recommended
in July that to produce ultra-low carbon hydrogen, Australia should enlarge electrolysis operations to commercial levels, a move embodied by these new projects.
Hydrogen is seen as the best source of energy and heat for low-carbon economies, and it is experiencing international demand after carbon abatement commitments were made as part of the Paris Agreement, according to the
Future Fuels CRC.
ARENA says that Australia holds a competitive advantage in the emerging hydrogen export market due to its expertise and infrastructure in energy export supply chains, proximity to key emerging hydrogen markets in Asia, and an abundance of renewable energy resources. It also cites a potential export market of $1.7bn.
The Council of Australian Governments’ (COAG) Energy Council is developing a National Hydrogen Strategy to build a “clean, innovative and competitive hydrogen industry,” which is slated to be released in December 2019.
The National Hydrogen Strategy will examine the economic opportunities of hydrogen, including in exports, energy, transport, and the gas distribution network.
The Queensland projects align with the Strategy and with ARENA’s
2019 investment priorities, which include integrating renewables into the grid, supporting industries to reduce emissions, and accelerating hydrogen innovation.
“We need to launch a hydrogen industry to create opportunities across the domestic economy and to help position Australia to become a major renewable energy superpower through exporting hydrogen,” said ARENA CEO Darren Miller.
In July, Boston Consulting Group (BCG) said that hydrogen will be key to decarbonising large sectors of the global economy but warned against buying into “dangerous hype.”
BCG warned that “If companies and governments do not become strategic about low-carbon hydrogen, they will waste large sums of money and could make ambitious climate goals even harder to achieve.”