Construction has begun on a world-first pilot to turn low grade ‘dirty’ brown coal from the Latrobe Valley into ‘clean’ hydrogen and then ship it inits liquid form to Japan.
The Hydrogen Energy Supply Chain (HESC) project by a consortium of Japanese and Australian industry partners could help pin a ‘clean’ tag on the use of Victoria’s considerable lignite reserves. This is because the centralised production of hydrogen from coal makes it potentially feasible to capture released carbon through carbon capture and storage (CSS).
The pilot will use up to 160 tonnes of brown coal in a process called coal gasification (a reaction with oxygen under high pressure) to produce an estimated 3 tonnes of hydrogen, and around 100 tonnes carbon dioxide, the yearly output of 20 cars.
Hydrogen, of course, is a potentially emissions free fuel, and Japan has been an early proponent of its wider use for transport and across domestic and industrial applications.
The country has developed a strategy to develop into a ‘hydrogen society’, based on the assumption that in the longer-term demand for hydrogen can be met using domestic renewable energy sources.
In the short-to-medium term, though, Japan’s energy transformation will rely on international supply chains, including hydrogen produced from fossil energies such as gas and coal.
It’s a welcome opportunity for Australia, which has significant scope for creating a hydrogen export industry based on both renewable and fossil energy sources.
It may also throw an economic life-line to Victoria’s coal producing regions. Two years ago, the Latrobe Valley was hit hard by the closure of the Hazelwood power station, and although there are signs that the local community is coping better than expected, the hope remains that coal will continue to play a part in the region's future.
This has been fueled by emerging new approaches such as the HESC project.
Japan is keen to tap into Australia’s large brown coal reserves, which holds the equivalent of 240 years of Japan's total electric power generation.
The interest is shared by the Australian and Victorian Governments which, based on the promise that that this may help create a new export industry potentially worth around $2 billion, have jointly chipped in a $100 million to the $500 million pilot.
There are concerns, of course, how the project will play out at larger scale, assuming the trial will be successful. For example, while the centralised process of coal gasification could potentially be low in emissions (despite the large amounts of carbon dioxide produced), there are still question marks about the CCS technology this would rely upon.
CarbonNet, a supporting organisation of the HESC project, is in the process of exploring a large-scale commercial CCS network that uses a shared pipeline to transport CO2 to an injection site in the Bass Strait.
Brad Page, chief executive officer of the Melbourne-based Global CCS Institute, said at the HESC's launch last year that the project presents a chance for CCS technology to prove its value.
But it is actually yet to be demonstrated that CCS is a commercially and environmentally viable option.
Then there is also the question of how the hydrogen will reach Japan, and this not a simple feat that will rely on technological advances by Kawasaki Heavy Industries, the HESC project's leading partner.
Kawasaki has long focussed on the marine ‘cryogenic’ transportation of Liquid Natural Gas (LNG), but is now exploring this technology for the transport of liquid hydrogen, which it sees as the key to large-volume transportation of hydrogen.
The proposal is that the hydrogen gas produced from brown coal obtained at the AGL's Loy Yang mine will be transported by road to the Port of Hastings. There Kawasaki’s cryogenic technology will be used to cool the hydrogen down to -235 degree Celsius, turning it into a liquid that has around 1/800 of the original volume.
It requires the construction of Australia’s first hydrogen liquefaction facility at Western Port, which began in July. For Victoria’s Minister for Economic Development Tim Pallas the commencement of its construction marks the beginning of "Victoria’s quest to become a global leader in hydrogen.”
But not everyone is as thrilled about the development. A group of eight environmental organisations expressed their strong concerns about the project in a letter to the project partners. “We, the group represented, strongly oppose the project proceeding to commercial stages and trust it will never proceed because the necessary dredging in Hastings is unconscionable.”
To then send it to Japan will require a purpose built liquefied hydrogen (LH2) carrier. Throughout the journey, the LH2 will need to be maintained at very low temperatures and kept from evaporating. It's a technological challenge, but according to Kawasaki, a vessel that meets interim safety requirements by the International Maratime Organisation is under construction.
However, as this plays out, it is worth noting that CSIRO is currently testing an alternative approach of large-scale storage and transportation of hydrogen, preferable from renewable energy sources, to overseas markets. It involves converting the hydrogen into liquid ammonia, which is then shipped via already established transportation routes.