64
5 Empirical Research for Establishing the Potential of Renewable Hydrogen …
Japan are first and foremostly interested in hydrogen as they want to take the leadership in technologies and applications using hydrogen for exportation purpose.
Applications include mobility, power generation or fuel cells. Secondly, Korean
and Japan see hydrogen as an opportunity to diversify their energy imports. Japan
is currently developing shipping lines to import hydrogen from where it can be
produced cheaply. Australia, which has a proven history of exporting commodities globally, sees the hydrogen as another export item and therefore, as another
business opportunity. In this context, the renewable hydrogen is not the preferred
option simply for costs reason.
In Korea, the carbon market is limited and does not provide any incentives for
decarbonisation of the industry. In Japan, the effect of a carbon tax on oil and
gas products has led to the development of a prosperous coal industry. Coal is the
cheapest source of energy in Japan. In Australia, the Federal government has not
committed on any target in order not to hinder the economic development.
All targeted APAC markets have near-shore petrochemical clusters with existing natural gas infrastructure. In those clusters, hundreds of thousands of tons
of hydrogen are produced and consumed every year. Almost all the hydrogen
production is done via SMR (steam methane reformation) or coal gasification in
China. If a share of this hydrogen is exchanged as a commodity between industries within clusters, most of the hydrogen is produced and used in-situ. Billions
of US dollars have been invested in those facilities and without any incentives for
decarbonising, petrochemical industry actors do not seem to consider renewable
hydrogen as a viable option for now.
Some of the current limitations seen in the Dutch market are also present in
the APAC markets.
There is no definition for the term “renewable hydrogen” in any of the APAC
markets. The renewable nature of hydrogen is not a driving factor of the development of the so-called hydrogen economy. Korea and Japan are investing in the
research and development of applications running on hydrogen. In this context,
the source of the hydrogen is not relevant. Cost is the driver. With high renewable
energy production costs, the development of a domestically produced renewable hydrogen is not viable in Japan and Korea now. In Australia, the Australian
National Hydrogen Strategy talks about “clean” hydrogen without providing a
clear definition of its meaning. Hydrogen can be produced from coal gasification
+ CCUS (carbon capture, use and storage) but can also be produced from renewable energy. The strategy is based on cheap production of hydrogen and exportation
to countries such as Japan. Some Australian states have however excellent renewable energy resource (i.e. solar PV in South Australia) and consider playing an
important role in the Australian hydrogen strategy.
5 Empirical Research for Establishing the Potential of Renewable Hydrogen …
Japan are first and foremostly interested in hydrogen as they want to take the leadership in technologies and applications using hydrogen for exportation purpose.
Applications include mobility, power generation or fuel cells. Secondly, Korean
and Japan see hydrogen as an opportunity to diversify their energy imports. Japan
is currently developing shipping lines to import hydrogen from where it can be
produced cheaply. Australia, which has a proven history of exporting commodities globally, sees the hydrogen as another export item and therefore, as another
business opportunity. In this context, the renewable hydrogen is not the preferred
option simply for costs reason.
In Korea, the carbon market is limited and does not provide any incentives for
decarbonisation of the industry. In Japan, the effect of a carbon tax on oil and
gas products has led to the development of a prosperous coal industry. Coal is the
cheapest source of energy in Japan. In Australia, the Federal government has not
committed on any target in order not to hinder the economic development.
All targeted APAC markets have near-shore petrochemical clusters with existing natural gas infrastructure. In those clusters, hundreds of thousands of tons
of hydrogen are produced and consumed every year. Almost all the hydrogen
production is done via SMR (steam methane reformation) or coal gasification in
China. If a share of this hydrogen is exchanged as a commodity between industries within clusters, most of the hydrogen is produced and used in-situ. Billions
of US dollars have been invested in those facilities and without any incentives for
decarbonising, petrochemical industry actors do not seem to consider renewable
hydrogen as a viable option for now.
Some of the current limitations seen in the Dutch market are also present in
the APAC markets.
There is no definition for the term “renewable hydrogen” in any of the APAC
markets. The renewable nature of hydrogen is not a driving factor of the development of the so-called hydrogen economy. Korea and Japan are investing in the
research and development of applications running on hydrogen. In this context,
the source of the hydrogen is not relevant. Cost is the driver. With high renewable
energy production costs, the development of a domestically produced renewable hydrogen is not viable in Japan and Korea now. In Australia, the Australian
National Hydrogen Strategy talks about “clean” hydrogen without providing a
clear definition of its meaning. Hydrogen can be produced from coal gasification
+ CCUS (carbon capture, use and storage) but can also be produced from renewable energy. The strategy is based on cheap production of hydrogen and exportation
to countries such as Japan. Some Australian states have however excellent renewable energy resource (i.e. solar PV in South Australia) and consider playing an
important role in the Australian hydrogen strategy.