Is this what the clean, green future of NZ energy looks like?

Hydrogen is the smallest and lightest element in the universe - and when produced as green hydrogen, could be used to fuel large vehicles. Photo / 123rf

It's being touted as the zero-emissions answer to New Zealand's "just transition" away from oil and gas.

But is chasing so-called "green" hydrogen as straight-forward as it's cracked up to be?

Last month, Prime Minister Jacinda Ardern launched a roadmap setting out what a hydrogen future could look like for energy-rich Taranaki.

Industry leaders are soon to meet again in New Plymouth for another summit featuring Oscar-winning director James Cameron.

The Herald looked at five big questions about green hydrogen.

So what is hydrogen, exactly?

Hydrogen is the smallest, lightest and also the most common element in the universe.

Still though, it isn't readily available on Earth as "pure" hydrogen as it rapidly combines with other substances to create compounds such as water, hydrocarbons and carbohydrates.

When hydrogen is produced commercially from hydrocarbons, it is typically classified as either "brown" hydrogen – when carbon dioxide was released – or "blue" hydrogen – when carbon dioxide was captured and stored.

Only when it is produced from water could it be classified as "green" hydrogen, as it is produced with zero emissions and using renewable electricity.

Production of hydrogen from natural gas is typically done through a steam methane reforming process.

This system broke methane into carbon oxides and hydrogen, from which hydrogen was purified and delivered at high pressure.

When hydrogen is produced using renewable energy, it utilised a process called water electrolysis.

The costs of each process depended on the cost of natural gas and the cost of power, said Harvey Weake, an adjunct professor at the University of Auckland and executive advisor to the Methanex Corporation.

Assuming that natural gas was priced at US$6 per gigajoule (GJ), the cost of hydrogen from steam methane reformers was approximately 50 per cent of the cost of electrolysis using renewable power, he said.

Hydrogen itself also wasn't new to New Zealand - and there was already a market here for it as a natural gas.

But this was mainly produced by reforming hydrocarbons - and any shift away from the latter would need to consider this demand alongside energy.

"Hydrogen is one of a number of fuels that could displace fossil fuels, depending upon its relative competitiveness," said Simon Arnold, chief executive of the National Energy Research Institute.

"Understanding where this will be is still unclear and is the key issue we face."

Could green hydrogen fit into our energy landscape?

Taranaki's roadmap report suggested it could.

It found a new network could include storage of hydrogen or synthetic natural gas in depleted gas fields, and electricity generation using green hydrogen in Taranaki's gas-fired peaker plants.

These plants could be rapidly powered-up to produce vital electricity during periods of peak need, typically supplying the crucial final 15 per cent of electricity demand.

New infrastructure around the region's natural offshore wind and wave resources – and onshore wind, geothermal, hydro, and solar resources – could be combined with an integrated hydrogen gas and electricity system.

Hydrogen refuelling infrastructure throughout the region could also link up with neighbouring regions to allow heavy vehicle freight movements.

Port Taranaki, which was already experienced in handling industrial chemical products, would be a key hub for hydrogen export.

Callaghan Innovation's electrical engineering team leader Robert Holt also believed green hydrogen was feasible.

If New Zealand built all the available wind capacity to the point where there was net surplus, he said, this could be exported as green hydrogen.

Under that scenario, overall renewable energy production on average could even rise above 95 per cent.

"This only becomes economical if long term commercial supply agreements are established and a large investment is completed in electrolysers, storage and a terminal or two," Holt said.

Holt believed hydrogen could be a flexible energy sink to allow the economic growth of intermittent renewable energy generation, especially wind power - and probably solar.

What are the benefits?

Hydrogen could be used as a fuel for transportation, heat and power generation, such was its flexibility.

Holt said hydrogen could find use as a thermal fuel gas, replacing or complementing natural gas; as a source of electrical power; or as a component in synthetic fuel or fertiliser production.

Port Taranaki in New Plymouth was ideally suited as an export hub for a future green hydrogen industry, a report found. Photo / File

Some specific applications included its use as an extra fuel source for industrial heating or drying.

Or it could be used as fuel for large vehicles, where the weight and charging time of batteries was a relative disadvantage when compared to fuel cell electric vehicles.

It could even complement natural gas in the North Island reticulated gas network, as had been done in Germany and several other countries.

"At a small scale, hydrogen could be an alternative to batteries or LPG within a renewable energy system," Holt said.

There were some obvious environmental spin-offs.

"Hydrogen coupled with fuel cell technology, available in a limited number of vehicle models, or for power generation, produces only water as a product," said Dr Paul Bennett, Scion's science leader for clean technologies.

But that would still carry a carbon footprint.

"Research focused on means to produce hydrogen from biomass and to capture and sequester the CO2 should be a priority," Bennett said.

"This technology would produce net negative CO2 emissions - and lessen the pressure on sectors that are difficult or expensive to decarbonise."

What are the drawbacks?

While there were few technological barriers to creating green hydrogen itself, the sheer logistical demands involved presented a clear challenge.

"Insufficient economic analysis of the complete value chain has taken place," Bennett said.

"For example, how much would it cost to replace the fossil fuel refuelling infrastructure across New Zealand, compared with biofuels that can be dropped directly into the infrastructure?

"A reliable comparison of the economic and environmental benefits of hydrogen versus electrification or bioenergy has not yet been done."

On top of that, a completely new supply chain would be needed, requiring new technologies at points ranging from production to shipping terminals and refuelling stations.

Holt expected the first green hydrogen would be relatively expensive and only available is a few special places.

There would also be some reluctance from businesses and consumers to accept a new fuel.

"There are some regulatory issues to be addressed, but work has started in the area and there are few experts available," he said.

"A high cost of CO2 emission per tonne would be the economic driver that would start to make green hydrogen attractive to businesses."

As the lowest cost hydrogen was likely to be centrally produced, it would therefore be relatively expensive to move by truck.

"Choosing a few well-placed centres for hydrogen generation will be a critical - and difficult – process," Holt said.

"Provision of dedicated pipelines for hydrogen transmission will require significant investment and would only be rolled out slowly, along with the demand."

Green hydrogen or blue hydrogen?

New Plymouth's MP and National's energy and resources spokesman Jonathan Young believed there was room for both green and blue hydrogen in Taranaki.

Young said the UK's Climate Change Commission report actually promoted more blue hydrogen, on the basis of uptake being enhanced by its lower cost and easier deployment.

"Even though the Government says renewables are coming down in cost, it's the scale and manufacture that is also critical," he told the Herald last month.

"And I do think the intermittency of many renewables that make the manufacture of green hydrogen probably less desirable, in terms of cost and reliability."

The Petroleum Exploration and Production Association of New Zealand (PEPANZ) has also singled out the high cost and electricity demands of electrolysis.

"Hydrogen can be produced using natural gas with zero emissions if carbon capture and storage technology is used," the lobby group's chief executive Cameron Madgwick said.

"There is already a concrete proposal from private investors 8 Rivers wanting to make a multi-billion investment into this technology in Taranaki.

"To enable this, we'd like to see the Government passing legislation to enable carbon capture and storage technology in New Zealand.

"It would be a big step forward for hydrogen, and a win-win for our economy and environment."

Weake saw an entirely different risk in simply "picking winners" in tomorrow's energy landscape, of which, he added, hydrogen was just one solution.

"There are a number of more commercially compelling options than using hydrogen, which inherently carries a safety risk due to the enormous pressure stored on board a car," he said.

"The issue that has prevented a widespread uptake is that it is not commercially competitive."

If New Zealand subsidised this option, he warned, the country as a whole could lose competitiveness.

"Producing a fuel for export doesn't make much sense given that New Zealand does not offer a specific competitive advantage and we are a long way from anyone else," he said.

"However, producing a fuel for domestic consumption that competes internationally at least provides an import replacement benefit to New Zealand."