Could hydrogen turn Taranaki into the Norway of the Pacific?

Friday, 20 July 2018

Forget what you think you know about hydrogen - it could be the fuel of the future.

Hydrogen - clean, green and coming to a neighbourhood near you.

How soon is the unknown factor, but it's something New Plymouth-based hydrogen fuel start-up entrepreneur Andrew Clennett​ is keen to bring forward.

While the highly-volatile gas may still carry a reputation from the Hindenburg airship disaster of 1937, Clennett says technology has moved forward in the intervening years and hydrogen could now be the saviour of a transportation industry heavily dependent on finite fossil fuels.

Clennett's company, Hiringa Energy, is located in the front room of the 165-year-old pioneer settlers' cottage that he and his wife and business partner, Cathy, call home.

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The view from the front lawn looks out over Strandon and Fitzroy Beach and the Tasman Sea.

Hiringa Energy's vision for a zero carbon emission future using hydrogen is more far reaching.

The two year old company was recently handed $950,000 from the coalition government's provincial growth fund to scope out hydrogen's potential as a zero emissions energy source for high use industries such as heavy transport.

Clennett sees a bright future for Taranaki, soon to lose its oil and gas advantage, and New Zealand as a whole if hydrogen can be used to replace diesel and petrol.

The region could either produce and distribute hydrogen, or develop infrastructure expertise.

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'We certainly think it is the fuel of the future that is ready to go now if you look at it as hydrogen and electric vehicles versus petrol and diesel. 

'We could become the Norway of the Pacific and be a net exporter of energy,' the former oil and gas executive says.

Both Clennett, and his wife come from strong project management backgrounds, having worked around the world and in New Zealand.

Before he helped found Hiringa Energy in the kitchen of his historic home, Clennett worked for Todd Energy, which recently announced it was to build a $100m peaker plant near New Plymouth to generate electricity.

The couple do not consider themselves, or the company the 'saviours' for the region, but started the company to have a better future for the next generation and their children, Cathy Clennett​ says.

'You need to have agents of change,' adds her husband.

Andrew Clennett says hydrogen will play a big part in the region with oil and gas reserves a finite resource and current estimations of 10 years of supply of natural gas unless another discovery is made.

The need to develop hydrogen has become more urgent since the Government announced in April an end offshore exploration.

'The world is changing and the use of diesel and petrol is declining,' he says.

While electric vehicles may be more suited to urban commuter environments and favoured by the government, the current prediction is that 20-30 per cent of the world's future energy needs could be carried by hydrogen, he says.

Hydrogen is 'absolutely riding on the coat tails' of battery electric vehicles but offered key advantages, he adds.

Hydrogen fuel cells are more robust and suitable for long range distribution, which suited Taranaki's isolated position to reach markets.

Fuel cell cars and trucks use hydrogen gas and oxygen to generate an electric current and power an electric motor.

Wind, solar, geothermal, or hydro energy can be used to produce hydrogen through electrolysis and using electricity to separate hydrogen and oxygen atoms.

Globally car manufacturers Mercedes, BMW and Toyota intend to spend $10 billion on hydrogen fuel cell research during the next five years.

Toyota aimed to produce 30,000 fuel cell vehicles a year by 2020.

In France and Scotland hydrogen fuel cell trains and passenger ferries are being built, while London and Aberdeen have established bus fleets running on hydrogen and China, Japan and South Korea are turning more to hydrogen to replace fossil fuels.

Hydrogen fuel cells in small aircraft are being developed in Germany and United States.

But the infrastructure uptake is slow.

There are 15,000 electric vehicle (EV) charging stations, and 40,000 outlets, in the United States compared to just 33 hydrogen refuelling stations, including 30 in California.

A 2007 report, from the Ministry of Economic Development, concluded energy efficiency from hydrogen production and distribution infrastructure was 'generally low.'

The report added that the development of a hydrogen economy and hydrogen-based transport fleet posed infrastructural issues, such as moving the hydrogen from source to destination, and fitting a large number of conventional fuel stations with storage facilities and equipment to distribute the gas.

Back then the report estimated pump prices for hydrogen would be US$1.20/kg, or NZ$1.78/kg, by 2020, where a 60 litre tank of petrol equals about 4.7kg of compressed hydrogen.

The most up to date price estimate now is US$14/kg, or US$5.60/gallon, or NZ$2.24/litre.

Clennett is unperturbed and says hydrogen is the 'energy vector' able to connect 'electricity, gas, molecules and electrons' together.

It can be used for cooking and heating as well as transportation, railheads and bus hubs, industrial parks and distribution of dairy product, he says.

'So it has a big part to play and Taranaki is the natural place to do it.'

The region already has the skill set to handle the transformation from oil and gas to hydrogen through an established engineering, fabrication, health and safety workforce, for example.

But the company's initial focus will be on commercial transport hubs, not retail.

'We see it as one of the elements for a Just Transition to provide good, well-paid jobs in the region.'

To the hydrogen proponents like Hiringa, hydrogen is an abundant, clear emission free power source with no waste product, except water and heat.  

Clennett says the public's knowledge and misconception of hydrogen could be traced back to the Hindenburg.

'Hydrogen got a bad rap from Mr Zeppelin although it was the hydrocarbon sealing dope on the exterior canvas which caused the explosion,' he says.

'It's a high pressure gas which can be handled safely.'

Clennett expected the first tanker of hydrogen fuel to be ready by 2020.

'The $950,000 grant will be used for the planning, engineering and consenting for the first supply and refueling infrastructure.

'It's a very good kickstart and we have a lot of interest from the private sector.

'It's a leap of faith but we've got the skills and partners to make it happen.'

Commerciality is the key, not developing demonstration projects, he says.

'We will supply the infrastructure and work with end users, such as central and local government, industrial and commercial users.

'We are not going to turn up like the new Rockefeller and supply the new fuel.'

Clennett expected a nine to 12 month lead time, with the first fuels ready by early 2020.

'The important factor is that we want the project to succeed, and the fuel be efficient and safe.'

It's early days but we envisage first pilot development will consist of building three refueling stations, two gas plants and trailers.

The cost would be near $30m, he says.

'There's a high cost for the technology but it is constantly being developed and the cost will reduce over time.

'There's a need to start the development now and reshape the energy sector.'

PEPANZ ceo Cameron Madgwick says the potential of hydrogen should be welcomed because New Zealand and the world are going to need more energy from all sources in the future.

'Natural gas is one of the main energy sources for producing hydrogen around the world,' he says.

'If used with carbon capture and storage technology it produces very minimal emissions.'

Madgwick says there is still a long-term role for oil and gas alongside new energy sources like hydrogen in a lower-carbon world.

'New technologies to capture emissions, planting more trees and replacing coal are just some of the ways oil and gas can also help lower net emissions in the future.'

TIL Logistics Group chief executive Alan Pearson said the company was ready to embrace hydrogen as an alternative fuel.

The Taranaki-based transport company recently signed up with 60 other companies to the climate leaders coalition group to tackle climate change and help New Zealand's transition to a low emissions economy.

The company operates nationwide with a fleet of 1000 trucks, using a total of 32 million litres of diesel fuel a year.

There are significant  cost savings then if a hydrogen fuel cell truck can be driven 800km before being refuelled for about $120.

Pearson says the company is committed to reducing its carbon footprint and follow Hiringa Energy's hydrogen development.

Any technology which can reduce carbon emissions into the atmosphere is a move in the right direction, Pearson says.

'We've got huge resources of fresh water to make hydrogen so it makes sense to look at how we can use it as a fuel.

'TIL is committed to working together as part of the coalition to create a sustainable future for New Zealand.'

Back in New Plymouth, Clennett says the key issue to reach zero carbon emissions is to be able to capture the carbon before it goes into the atmosphere.

'If we can achieve this with natural gas as a source of hydrogen that would be a good option,' he says 

'The solution to achieving fully sustainable zero emissions is to have renewable energy.

'We are not looking to have oil and gas shut down tomorrow.

'Ultimately hydrogen may replace oil and gas but it will take some time. 

'Now is a very good time to start the industry in Taranaki and start also to generate hydrogen from renewable energy.'