National Hydrogen Strategy Issues Papers

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Marcus Clayton

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Bennett Clayton P/L

Issue 1: Hydrogen at scale

2. What approaches could most effectively leverage existing infrastructure, share risks and benefits and overcome scale-up development issues?

What approaches could most effectively leverage existing infrastructure, share risks and benefits and overcome scale-up development issues?
A domestic program designed to supplant diesel power generation with hybrid solar/wind/hydrogen generation systems would allow a rapid skilling of a work force, and a trial of different technologies.

3. What arrangements should be put in place to prepare for and help manage expected transitional issues as they occur, including with respect to transitioning and upskilling the workforce? How do we ensure the availability of a skilled and mobile construction workforce and other resources to support scale-up as needed?

What arrangements should be put in place to prepare for and help manage expected transitional issues as they occur, including with respect to transitioning and upskilling the workforce? How do we ensure the availability of a skilled and mobile construction workforce and other resources to support scale-up as needed?
Have a good look at financing issues, particularly with respect to PPA and EUA arrangements that are effectively nullified for many organisations since new accounting rules introduced January 2019

4. What lessons can be learned from the experience of scaling up supply chains in other industries?

What lessons can be learned from the experience of scaling up supply chains in other industries?
Do not lock in contract prices too early, or for too much volume

Issue 2: Attracting hydrogen investment

2. How do we ensure an attractive investment environment for private sector finance? Which methods would be most effective in leveraging maximum private sector finance and which activities should governments prioritise with limited funds? How should these methods change over the short, medium and long term?

How do we ensure an attractive investment environment for private sector finance? Which methods would be most effective in leveraging maximum private sector finance and which activities should governments prioritise with limited funds? How should these methods change over the short, medium and long term?
I suggest the various governments strongly support hybrid solar/wind/hydrogen generation in all areas where diesel is currently used for power generation.
Around 37% of power generation in Australia is by diesel, and the cost ranges from around 40 cents to $1.00 kw/hr, and governments subsidise that cost. Add in logistical issues of getting fuel to site, fuel security and environmental issues, and there is an extremely strong case to be made for changing to renewable power and making hydrogen on site to power generators for baseload.
This would quickly develop a skilled workforce, attract investment and trial differing technologies.
Bennett Clayton have signed a privately funded development deal to build Hydrogen powered Internal Combustion Generators, that will complement Fuel Cells and Turbines, and can do so at lower cost in the 500kw -5000kw range that is typical of remote and regional diesel installations

3. What level of domestic market support is needed to achieve COAG Energy Council’s ambition of being a major global player in hydrogen? In particular, what types of support will best provide the necessary domestic skills and capabilities and ensure domestic markets are available in the event that international markets do not emerge as quickly or as extensively as expected?

What level of domestic market support is needed to achieve COAG Energy Council’s ambition of being a major global player in hydrogen?
Investment in Hybrid renewable/hydrogen plants will be returned quickly, particularly as the ongoing subsidies paid to diesel generators will no longer be required.
This support will foster local businesses, develop their skills and ensure a domestic market is created.
The model relies on equipment being serviceable and maintainable on site, which is one reason why Bennett Clayton are developing an internal combustion engine that runs on Hydrogen. Fuel Cells are in no way maintainable in remote areas at the present time.

5. What market signals and settings are needed to capture hydrogen’s sector coupling benefits? When should these market signals and settings be applied?

What market signals and settings are needed to capture hydrogen’s sector coupling benefits? When should these market signals and settings be applied?
Start the remote area Renewable Hybrid Hydrogen Program, and ensure grants are available to make it affordable to investors who would like a PPA agreement or to communities who wish to run their own system.

Each system should attract a modest tax or tariff (like car registration) that will repay the grant over time and provide insurance in case of loss through disaster, fire/flood etc