Australia can be a global leader in low-cost clean hydrogen and ammonia

Australia can become a world leader in the game-changing potential of low-cost, clean hydrogen and ammonia as these new, clean fuels will help realise the global task to deliver net zero emissions by 2050.

The MCA’s new report, Australia’s emerging hydrogen and ammonia industry, launched today looks into these two energy carriers, their potential and the opportunities for Australia.

The International Energy Agency suggests clean hydrogen production will need to double by 2030 and increase six-fold by 2050 to meet this target from the current annual production levels of around 90 million tonnes (Mt) to more than 520 Mt.

Ammonia also offers real prospects for decarbonising global shipping fleets, fertiliser production and electricity generation. This will require development of new pipeline and storage infrastructure, including at ports.

With substantial carbon capture, utilisation and storage (CCUS) sites in Victoria and Queensland, competitive and accessible coal reserves, natural gas and significant renewable energy generation capacity, Australia is well placed to meet growing international and domestic demand for this important fuel from multiple supply chains drawing on the country’s vast natural resources.

With Japan a significant investor in research, development and deployment, Australian industry is working to deliver long term supplies of clean hydrogen and ammonia, such as through the Hydrogen Energy Supply Chain (HESC) project utilising gasified coal.

Glencore is investing in pre-feasibility studies for commercial scale hydrogen and ammonia production, while progressing environmental approvals for a CO2 test injection at its CTSCo CCUS project’s storage site.

There is also great potential for Australia to develop hydrogen and ammonia production supply chains using renewable energy sources.  These will be dependent on various metals that form the basis of new storage technologies and electrolysers including copper, lithium, nickel, cobalt and rare earths.

The size of the prize could be very high with one estimate suggesting a new multi-billion dollar export industry of more than $20 billion for hydrogen by 2050.

To realise this potential for Australia, federal and state governments need to focus on removing regulatory barriers, including expediting approval processes for associated infrastructure like pipelines, hydrogen fuel stations and ammonia storage.