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Highlights
- On Thursday, ANZ produced a handbook on the hydrogen sector.
- Hydrogen does not produce any carbon emissions when burnt and, as per ANZ, commercialisation of hydrogen is a priority today.
- Singapore plans to develop a sustainable hydrogen supply chain from Australia to the island nation.
The global campaign to decrease carbon emissions to net-zero by 2050 is moving quickly, with targets and concentration increasing in every area of the economy. Countries plan to transition away from fossil fuels after vowing to achieve net-zero emissions by 2050 or sooner.
According to ANZ’s Environmental Sustainability Strategy, the financial services industry will play a critical role with investors and intermediaries like banks and insurers to achieve this goal. These financial institutions will provide capital and risk mitigation for funds required to support the worldwide shift to net-zero emissions.
On Thursday (February 10, 2022), ANZ produced a handbook on the hydrogen sector, citing a high level of interest from its corporate and institutional clients for a deeper understanding of the market.
ANZ stated that commercialisation of hydrogen is a priority endeavour. By 2025, ANZ wants to fund and facilitate AU$50 billion by 2025 and enable the transition to a net-zero carbon economy for its customers, including renewable energy, green buildings, and future technologies like hydrogen.
Also Read: How global banks can help in controlling greenhouse gas emissions
Why is hydrogen better than other liquid and gaseous fuels?
Hydrogen does not produce any carbon emissions when burnt compared to other liquid and gaseous fuels. Therefore, substituting carbon-free hydrogen for fossil fuels will considerably reduce greenhouse gas emissions globally.
Moreover, hydrogen has roughly two-and-a-half times the natural gas energy per kilogram. This can be released as heat or power via combustion or a fuel cell. In all circumstances, the process requires only oxygen, and the only by-product is water.
What is Australia's plan to export green hydrogen?
Australia's ample wind and solar energy resources and its large geographical mass put the country in a strong position to build a hydrogen export market to important Asian clients.
With this, the country aims to be on top of the race for rising demand of the energy source and make profits out of it.
Countries like Japan and South Korea target reaching carbon neutrality by 2050, while China has already announced to meet the net-zero carbon target by 2060.
On the other side, neighbouring country Singapore plans to develop a sustainable hydrogen supply chain from Australia to the island nation as per its green plan.
What are the challenges that countries are facing?
Green hydrogen is more costly to create, store, and transport than other alternative fuel sources. The principal method of large-scale renewable hydrogen production - electrolysis, adds a high cost.
However, it is questionable whether renewable energy prices will decline quickly soon enough to make green hydrogen production affordable before 2025.
Bottomline
Due to its low-cost renewable energy supply and the potential for large economies of scale, Australia is well positioned to achieve low-cost green hydrogen production. However, there should be higher demand to drive down costs, and a wide range of delivery infrastructure must be built with the support of government targets and subsidies to help meet these future cost targets.
Also Read: Australia’s deputy PM denies changing 2030 emission reduction target
