Image Credit: Matti Blume [@CC-BY-SA 4.0 Matti Blume] via Euractiv   

This is a guest post by David K. David worked in the oil industry for many years in the Middle East, Europe, Asia and New Zealand.

Will hydrogen technology be a useful part of New Zealand’s climate response? Is it a potential export commodity?

Earlier this month, Prime Minister Jacinda Ardern mentioned hydrogen in a speech about the future. Business Desk reported:

The government wanted to “ensure New Zealand is well-positioned to produce green hydrogen at scale and exploit this economic opportunity”, said Ardern, who also focused on reducing the country’s long-term reliance on fossil fuels as a way to “control and protect our economic future”….

Ardern said its versatility, low weight and wide range of uses could make it a particularly valuable and sought after export commodity NZ was “uniquely placed” to produce.

While hydrogen may well turn out to have a niche role internationally in long distance heavy transport, in my view it will not be a major contributor. Nor do I believe it can be an export opportunity for New Zealand.

Some Science

On Earth, hydrogen exists in enormous quantities but always in combination with other elements. One of the more common is water – one oxygen atom bound to two hydrogen atoms – which forms our oceans, clouds, rain, snow, ice and rivers. It is an extremely stable molecule, which is why any hydrogen gas produced by nature (or used in a vehicle) immediately combines with oxygen to form water. Reversing this reaction by splitting water using electricity is possible, but it takes a tremendous amount of electricity.

A 10 MW Electrolysis Plant in Germany. Source: Shell Energy, via Powermag.

The proposal to use green electricity to split water in New Zealand would need to satisfy the following three requirements:

a) The use of electricity to produce hydrogen for transport must be more efficient than using electricity in electric vehicles directly.
b) The use of electricity to produce hydrogen for transport must make more economic sense than using that electricity for other purposes.
c) To export hydrogen, there must be an international traded market for hydrogen. Currently, there is not.

Hydrogen for Transport

Fuel cell vehicle and hydrogen charging station. Credit: FuelCellWorks via Labroots

The huge amount of electricity required to split water into hydrogen and oxygen means powering a car with hydrogen is about one third as efficient as using the electricity directly in an electric car. The hydrogen route is also very much more expensive.

Hydrogen can be burnt directly as a fuel or used in a fuel cell to produce electricity to drive a conventional motor.

An illustration of a hydrogen fuel cell

Using hydrogen directly has some safety issues and requires high pressure storage and highly engineered fittings. For this reason, most hydrogen vehicle research and development has focused on hydrogen for fuel cells. Most car companies have now abandoned this path as being around five or six times as expensive through the life cycle compared to electric batteries. A quick internet search will show a few public council examples of early adopters of hydrogen buses moving to electric after experiencing prohibitive costs. The laws of physics are unlikely to change so this barrier will remain.

New Zealand’s Future Sources of Green Energy

While New Zealand’s electricity generating capacity at present is about 86% renewable, the balance is produced by hydrocarbons. However, the future demand for electric power will be immense. Electric vehicles, data hubs and natural growth will require a huge investment in renewable generation. Even if Tiwai Point closes, New Zealand will need a lot more green energy to meet these future demands in a climate friendly future. With one proposed exception (Lake Onslow NZ Battery), major hydro schemes are not possible, and nuclear is not a good fit for New Zealand. The options are therefore geothermal, wind and solar, with supplementary biofuel, plus more efficient use of the electricity produced. This has been well set out by the Climate Commission and many others.

The principal point here is with the unavoidable demands on the green fraction of energy in our known future, the energy for any additional large consumer such as green hydrogen electrolysis doesn’t exist now, has to be separately constructed and needs to justify its place on climate change and/or economic grounds. The major power generators and Transpower have some investment proposals, but even if Tiwai Point closes, the green electricity available will all be needed elsewhere.

Export Hydrogen: Why is There Such a Lot of Noise About Hydrogen Lately?

At present hydrogen is almost exclusively produced by the oil and petrochemicals industry for their internal use. They use a cheaper, but still very expensive, process which splits methane into hydrogen and CO2.

Part of a Hydrogen Plant (a Steam Methane Reforming Plant) in Germany.

This is obviously not compatible with climate change ambitions. Why would the major industries want to pivot this way, given hydrogen can’t compete with electricity on efficiency grounds, for most vehicles?

Part of the answer is that hydrogen may have a role in decarbonizing the steel, cement and fertilizer industries. Also, due to the weight of the batteries required, electricity hasn’t been a solution for long distance air travel or heavy long-distance trucks. Hydrogen fuel cells are lighter and are a potential solution for the heavy transport problem.

Hyundai Xcient hydrogen fuel cell truck. Image: Hyundai, via Autoweek

Therefore the oil/petrochemicals industries are attempting to set up hydrogen hubs in places like Europe to convert heavy transport and assist with decarbonizing steel and cement production. There would be big environmental benefits if they succeed.

However, all the oil/petrochemical companies currently make their own hydrogen as close as possible to where it’s consumed, normally within just a few metres. Why?

Some more science

Hydrogen is the smallest molecule found in nature, which gives it unique properties. It’s a very low-density gas so needs to be stored at high pressures; think dive bottles not petrol tanks. It can easily burrow through steel and other containers, so they need to be thick. And therefore, heavy. If it escapes it ignites easily and burns with a colourless flame. This all makes hydrogen very costly and hazardous to move around, and more economic not to. Although the handling and storage challenges are solvable, the hazards mean it is unlikely to ever be suitable for the general public to use directly.

The Hindenburg Disaster. Image: Wikipedia.

Hydrogen Trading

For all these reasons of handling and economics, hydrogen trading doesn’t exist at present.

This point is worth repeating – no hydrogen trading, long distance transport or export system exists anywhere today. The oil companies and others have the resources and the motive and are moving as fast as possible to set one up, but it will certainly take years and huge amounts of money to do so. Even then, it will probably only be viable in the next decade in dense industrial areas in Europe, North America and China. Hydrogen will be manufactured where the cheapest excess green (including nuclear) energy is available, or it will be manufactured close to the consumer, where the transport efficiency penalty is least.

To go from that to a fully international trading infrastructure will take more years and much bullion.

And once it’s finally in place, who would our customers be? Australia could more easily produce green hydrogen using vast solar resources. All the big transport, steel and cement consumers are in the northern hemisphere and shipping costs would be prohibitive.

Meanwhile, Battery Technology Keeps Improving

It’s also worth noting that the transport part of the hydrogen vision may be overtaken at any time by a breakthrough development in low weight battery technology. Already, an electric bus has been driven from Auckland to Wellington with only one 2.5 hour charge mid-way.

Jo Crickett, who drove the electric bus from Auckland to Wellington. Image credit: EVs & Beyond

In Conclusion

Since hydrogen burns to water, what’s not to like? Well, quite a lot. But it seems that consultants can make a lot of money pushing this New Sensation.

The sensible strategy for New Zealand is to focus our limited resources on what really makes a difference.

If our problem is climate change then green electricity should be used to directly power electric vehicles (while also reducing the demand for vehicle travel).

If our problem is wanting to develop a new profitable export industry, then based on these arguments, green hydrogen is not it. For those old enough to remember Muldoon’s Think Big, this has a sense of déjà vu all over again…

Share this


  1. It’s insane to think NZ will be exporting hydrogen. It’s also insane to think that heavy and long distance vehicles are going to work as EVs and this obvious reason why they want hydrogen be a thing.

    E cars work as weighing an extra 50% on their ICE equals is typically not a big deal because cars are usually massive overkill for what they are moving. Trucks and busses mostly don’t move around heaps of excess capacity, so increasing their weight by 50% doesn’t work outside of very short trips maybe.

    Thankfully rail is a thing.

  2. It’s bizarre how NZ how NZ would even consider revisiting the types of investments that failed so badly in the past. Another that could make most NZers poorer is the proposal that the agriculture industry continues much as it is, and that hardworking kiwis pay 85% of the carbon emissions costs.
    We need to adapt for an emissions restrained world and some of that might mean forgoing what we now think are necessities.

    1. Indeed, since Muldoon NZ governments have tended to gravitate towards the big, shiny toy type of solution, rather than what actually works . In the hydrogen (and Lake Onslow) examples, the approach is very much a 1970/80’s type of thinking. I believe the actual things NZ can do are a fast incremental application of smaller things like batteries at suburb level distribution, offshore wind at scale (an oil industry area of expertise), more cycleways, seaweed for bovines and so on. Not glamourous, but much quicker and much more effective.

      If you want to be depressed – the world consumption of crude oil is almost back to pre pandemic levels, and air travel hasn’t really started back yet.

      Grita is mostly right when she talks about bla, bla bla from politicians. Most of the actual effective action on climate change is (ironically) being made by the big car companies (electric vehicles), Chinese solar developers and the oil and gas industry (offshore wind).

  3. Thanks, David. I wish someone would do some work into who is advising cabinet on new technologies, whether cabinet does any due diligence or if this is just what it seems to be – a Wellington problem of pecking orders and inner circles.

    1. Hi Derek,

      See my reply to Taka-ite above. My feeling it is partly that the decision makers want to do the right thing, but are mostly non technical, so can be swayed. Their advisors seem to be quite a closed circle of “people we already know. Preferably Wellington or Auckland based”. We see this in many of the government departments and actions.

      The other angle is that what actually needs to be done is huge in scale (reform the electricity market, generate a lot more power, close Tiwai Point and so on), too expensive for New Zealand and politically too hard to sell. So the advisors/leaders default to solutions which involve lots of activity but deliver later.

      David K

      1. Hi David right on all accounts I am in total agreement with yourself and the above comments. I have been measuring the minister for the policy on manapouri Power station and it’s future pointing out exactly what you are saying above. Canterbury University department of mechanical engineering are good allies they understand that the best use of our renewable electricity for transport is in rail electric trains. I would just urge all reading lists to write to the minister saying so hydrogen production is just not an efficient way to use our renewable electricity.
        One of my projects in later career was tearing down a massive plant built to make petrol gas to gasoline it was opened by the Prince of Wales to an enormous fanfare cost an unbelievable sum
        and produced almost no gasoline relatively speaking. Can we not burn from these very recent mistakes?

  4. Hydrogen is being pushed because it’s something someone can sell..nobody likes the idea of people charging their electric vehicles at home via solar panels on roofs etc, nobody other than the solar panel and car makers make any money here…couple that with the motor industry who will lose so much custom through lack of servicing vehicles etc.

    Battery improvements coupled with self charging will lead the way for a while and maybe in 50 years time, nuclear fusion will play a part for high powered things such as ships and planes.

  5. Hydrogen production relies on cheap electricity to overcome losses from its use, e.g. conversion back to electricity or burning to make heat. If there are other methods of delivering the same electricity directly or more efficiently, like batteries or a power grid, then hydrogen is only an additional cost.
    Our electricity is currently not cheap internationally, and only likely to get more expensive as demand increases, as most cheap generating options have already been built.
    Potentially hydrogen might be generated from intermittent supplies like wind and solar, but wind is too expensive and I don’t believe solar is currently cheap enough. Perhaps solar might be cheap enough in Australia.

    1. Don’t we have plenty of electricity that goes to waste though? Wind turbines turning at night, hydro lakes over filling in winter, very cheap power going to aluminium smelters, etc. Hydrogen might be a better storage option compared to say pumped hydro or batteries?

        1. Batteries are very expensive to store any serious amount. I don’t know enough about pumped hydro to comment but it I can’t imagine it is that efficient (surely we don’t get all the energy out of falling water via a turbine do we?).
          My main point is that the 30% efficiency of hydrogen storage is much better than the 0% efficiency we get now by just throwing it away.

        2. Pumped hydro is about 75% efficient. That is a lot more efficient than hydrogen as a store of energy.

    2. I think this paper is a very interesting read around potential for cheap energy with wind in NZ:

      If offshore wind was cheap enough to do then the expanse of shallow water around Taranaki is a potential globally impactful energy supply.

      The total potential offshore wind resource in Taranaki waters
      is considerably larger than the energy currently extracted on
      an annual basis from Taranaki’s existing oil and gas fields. It
      is an energy resource that has the potential to be globally

        1. Cable to shore, then DC/AC conversion etc and feed it into the grid. This technology is going in now – very big projects for Scottish Power, offshore US north east coast and quite a few others. If you’re interested Google Scottish Power offshore wind – they are putting in 25 Giga Watts of generation (that’s a lot). You will note that many of the players are the oil companies. 🙂

  6. There’s two things not mentioned that gives hydrogen it’s advantage:

    1) The geopolitical landscape of lithium — that is, battery supply will be governed by heavyweight nations. Hydrogen is an opportunity to have independence in the energy market, if only for our own domestic consumption.

    2) Energy storage. Though the energy demands of producing hydrogen near-cancel the gain from energy outputs, hydrogen converts the renewable generation into a resource that can be stored, permitting it’s use similar to how we already use hydrocarbon fuels. Battery tech is moving towards lighter and smaller, but it’s not fit-for-purpose to manage on-demand grid storage or the transportation advantages that hydrogen has.

    We can’t ignore the economic prohibitors of hydrogen, but there is merit to our foray in the sector.

    1. One would hope that hydrogen offers energy storage advantages, because that’s all it is. Can you explain your use of the term, “near-cancel”? One significant advantage of electric batteries is that we have an electricity grid in place throughout the entire country.

      I don’t see merit in this particular foray. I see far more merit in New Zealanders recognising that our distance, our low population, and our lack of a big oil industry presence here are real, concrete considerations, and that we should learn when to sit out the exploration of new technologies.

    2. Very much this, and the storage allows us to run trucks as mentioned. Unfortunately we do not have those star wars fuel cells that can slot into anything and have near infnite energy storage.

      I used to think it’s a fad as well, but I now see a future of mixed technologies. I can see multiple solutions in the future. Which includes Batteries, hybrids, hydrodgen, hydrogen hybrids, and good ol’ diesel/sludge being around.

      For climate change we really need to decarbonise our cities, and most gains to be made are with mode shift. Running a diesel bus, vs all those passangers driving an EV? Diesel bus is the better option.

      I am quite against goverment investing in any technology as such. They should focus on building infrastructure. A good road, a good train network can take vehicles of any fuel. If Hydrogen takes off and makes sense to make. It will come on it’s own merits, we don’t need to push it.

    3. 1) Lithium is a really common metal that many countries could be extracting if they wanted to. The geopolitical constraint on its use just where the battery factories are. But any country could build its own battery factories if it wanted.

      2) Hydrogen energy storage is expensive, isn’t very efficient and doesn’t scale up very well. Far easier to use batteries (short term, smaller scale storage) or pumped hydro (long term, large scale).

    4. The hydrogen electrolysis process needs catalysts to work – and the best current industrial electrodes use the precious metals iridium, ruthenium, and platinum. None of these metals are common, but iridium in particular is one of the rarest elements on Earth, with less than ten tonnes produced each year. Much of the iridium in the Earth’s crust is thought to have been deposited by asteroids, in ‘iridium anomalies’.

  7. Off topic but interesting- Helium was being produced at the time of the Hindenburg but the US Government restricted it because they saw it giving them a strategic advantage over everyone else. So the Germans continued to use hydrogen for airships. The coloured flames are thought to be due to the doping paint and materials used rather than the hydrogen, which should be colourless.

    1. If transporting hydrogen is so difficult as to rule out significant exports, then doesn’t that mean that any significant imports will be unlikely as well? If that’s the case, and if the heavy transport sector (electrified rail excluded) does becomes reliant on Hydrogen fuel, then surely having some domestic production capacity will be necessary?

  8. Could we put overhead wires on the highways for electric trucks to connect up to similar to wellington’s old buses?

  9. Just to note that it was the dope (type of paint) on the Hindenburg that caught fire, not the hydrogen. Of course that burnt after.

  10. Hydrogen has some limited potential applications in New Zealand,

    But I really can’t see it working for exports given our small size.
    H2 in this part of the world is likely to be solar and generated in Northern Australia on a huge scale and then exported to Asia to replace the current LNG trade..

    In NZ I can see it being used basically as a “peak smoothing” battery, – generate at night with unused wind power, and then use in the morning or evening peaks,
    It might be possible to use it for winter seasonal load, but pumped hydro at Onslow might be a better/cheaper option…

    But If battery costs fall faster H2 will get priced out of this market….and will pretty much only become a large scale LNG replacement,

  11. I’ve been looking at hydrogen as an interested amateur for years, and came to a similar conclusion long ago – it’s just not viable, unless there’s perhaps some source of abundant energy to keep re-cracking water molecules to sustainably replenish supplies. Something like fusion power…

    But then there is the possibility of hydrogen-rich molecules, with ammonia being the most likely candidate. Ammonia production needs to be decarbonised anyway, because the industry is a major CO2 contributor and the product is widely used in food production. But if a sustainable source of ammonia can be found, then that creates possibilities for it’s use as an energy source also.

    Decarbonising AMMONIA production. Could a revolutionary new process be the key?

  12. Hydrogen can be used to replace coal in steel manufacture but it would require a complete rebuild of the mill and would it be economic. So up to Bluescope I would think. Golden Bay already burns wood waste, used lubricating oil and shredded car tyres to replace coal so not much room for hydrogen there. The urea plant could use green hydrogen in its ammonia production. Certainly they have said they will when the electroyliser gets going in Taranaki. Air New Zealand wants hydrogen for its planes as soon as possible. Apart from that its hard to see much benefit except as a way to force up the price of electricity to the aluminium smelter. Battery electric freight locomotives are becoming a thing so Kiwirail should be watching that closely. Electric ferries will replace diesel ones in the next few years. Electric Buses and even Intercity ones will be doing the bulk of the trips with diesel buses relagated to peak periods only. I am less optimistic about trucking however if trucking companies start winning contracts because their electric trucks are more economic then change may happen real quick. My generation is very Conservative when it comes to changing to electric cars however we will die out soon so the younger generation will be the ones to change. Electric utes may be the tipping point for them. But they will need high power charges just like the one used by the bus in Taupo.

    1. Thanks David for this reference that I have now read. It really refers to the European situation where population density and shorter distances favours the battery electric vehicle. There also are powerful drivers such as Germany, that relies on 18% of its GDP on its vehicle production and is transitioning to BEVs. Megawatt charging installations aren’t cheap. A McKinsey report estimates the capital cost at twice that of a hydrogen installation, and sufficient numbers have to be built to guarantee access. The article does not preclude the adoption of heavy trucking FCEV as an option. I think it is a fair assumption that Hiringa Energy in partnership with Waitomo fuels have done their homework on costs and sourcing of commercial vehicles. There are other reasons to support the hydrogen option. A recent webinar that I attended, the shipping companies discounted batteries an option in favour of liquid fuels; either ammonia or methanol, both of which have can have green hydrogen as a precursor. Kerosene e-fuels also look the best option for long range aviation. Hydrogen at scale would also encourage more R & D on increasing the efficiency of fuel cells and electrolysis.

  13. Also w have a wonderful nation-wide network for distribution electrons. Moving molecules (even hydrogen ones) will take a massive roll-out of infrastructure, high-tech pipes and valves and pumps etc. That’s why big-business is so keen. EG the petrochem industry love the idea of a hydrogen economy. Follow the money to see who benefits. It wont be NZ Inc or our consumer’s and tax payers that’s for sure.

    1. I did think hydrogen could have some niches where there isn’t a national grid.

      We have islands like Stuart Island, Chatham Island, Gt Barrier etc that are not grid connected and mostly burn diesel in generators.

      I did wonder if a decommissioned Tiwai point could have a hydrogen plant that can pump compressed hydrogen into a specialised coastal tanker ship that delivers the energy to islands where it could be used to run micro-grid scale fuel cells.

      There is no infrastructure though, small populations on the island, no suitable ships and I suspect even if you did get all that sorted, by that time things like Tesla power units combined with solar, wind and other renewables would work out better/cheaper

      1. If there’s cars, then they’re already transporting Fossil Fuels to those islands to power those cars.

        Even powered by a Diesel Generator – a BEV is still more efficient than it’s Diesel equivilant. Meaning ultimately still less Diesel being tanked around.

        Long term I’d love to see the math on running new undersea cables compared to maintaining a hydrogen tanker. My bet would be on the cables.

      2. These islands could already meet all their electricity needs renewably using existing solar and wind and battery technology. Even if everyone owned an electric vehicle it wouldn’t matter because they don’t have large populations or long driving distances. Driving from one end to the other is ~50km (Great Barrier), ~60km (Chatham) and ~10km (Stewart). Charging an EV would not be an everyday occurrence.

  14. Not sure if anyone remembers, but the first George Bush was a keen proponent of Hydrogen – which was greeted with relative incredularity at the time. A man way before his time, it would seem, although I never liked him or his politics. But back then in the early 90s the technology to make, harvest, store, and use the hydrogen created was nowhere near ready – there were no hydrogen cars on the market obviously, but then again – there were no battery electrics either, and hybrids hadn’t even been invented yet (I’m sure someone out there will tell me I’m completely wrong – thanks Sailor).

  15. Lithium battery is an mature and ready technology and it is still improving.

    Hydrogen is a potential technology but not yet ready for mass consumers. It may fit into specific commercial use-case.

    Rather than waiting for hypes like fussion powerplants, novavax, solid state battery… we shall just take whatever mature technology for now.

  16. There is a great deal on twitter by Auke Hoekstra and Michael Liebreich about heavy transport and FCEV vs BEV trucks.

    BEV can have a lighter drive train.

    They drop weight in other ways as well.

    Like building the battery into the vehicle structure.

    There is a point about charge times vs refulling. Swapable batteries might be an option.

  17. Thanks David. What do you make, then, of Hiringa Energy, who have received government funding to build a network of hydrogen refuelling stations in the North Island, including one in Palmerston North to be built in 2022, and who say they have ordered 1500 hydrogen-powered trucks from Hyzon, to be delivered in 2025? As far as I can tell Hyzon has not yet built any hydrogen-powered trucks, although they do have a bus on trial in Queensland.

    New Zealand may not have the solar resource of Australia, but we do have stronger climate goals. If fossil fuels were banned, alternatives like ammonia and synthetic kerosene might be worth producing here rather than imported.

    Maybe the juicy juicy carrot of a possible export industry is what it takes to get us interested in getting off fossil fuels…

    1. Hi Robert,

      I expect the key phrase here is “government funding” which I believe is financial support for a pilot plant. I can’t see how this venture would be profitable on its own. I would be very interested to see their projected Profit and Loss and Balance sheets. One could perhaps be quite cynical?

      If government support is to be given, then in my view there are quite a few better candidates.

      If climate change is our challenge, then as I said – the planet doesn’t care where the CO2 or methane cane from. We should concentrate scarce resources on wherever has the biggest bang for the buck. Clearly hydrogen doesn’t complete. Solar and offshore wind definitely have a role.

      On the wider subject of potential export industries – my observation is that countries should stick to things they have a natural or established advantage and not try to compete from a position of weakness. e.g. it would obviously be foolish for NZ to develop and electric car industry against the big internationals. If we are going to develop something new, in my view we can leverage our geographical location, our culture (good a t problem solving and creative thinking and so on), green branding and more. Hydrogen electrolysis is vanilla technology and will probably remain so, so fails as a candidate.

      David K (the author – I see another David is also commenting ;-))

  18. One topic not raised is energy security. It’s not ideal to depend on China and other world powers for critical parts of most of our energy needs in entire sectors. For this reason it’s good to plan in advance for supply chain problems, war, trade embargoes/blockades, and restrictions in supply for political reasons.

    If we depend too much on batteries, even when things are going well we leave ourselves exposed to manipulation and external control. We should have a range of energy options even if some of them are less efficient or less clean, because we are certain to open the folder labelled “Plan B” at some point in the future. Living in a age of pandemics reminds us that bad things can happen at any time.

    1. Yes, planning for resilience is important. It requires scenario planning, and choosing the steps forward that are beneficial in all likely scenarios. I’d like to see a post on how the government is doing this, actually, if anyone would like to delve into it. One key factor is ensuring the outlier solutions – the ones that only deliver benefits for the less likely scenarios – don’t sap investment from the ones that are likely to deliver benefits for all scenarios.

      1. My daughter asked me yesterday why the 20+ Kianga ora developments across the road don’t have solar panels but do come with carparking

        1. And I bet none of the car parks has a rapid charge plug.
          In times of change the slow uptake of the new and well proven technologies by existing bureaucracies and the hand waving about something better (hydrogen) that’s just over the horizon by the powerful encumbents (Petrochem ind) are opposites sides of the same coin. Change resistance.
          The only leadership from Labour on this is a bit of hand waving alongside the petrochem industry. Oh and they banned NEW oil & gas exploration.
          On the other hand, solar water heating and solar PV power are both well established technologies and the first should be a mandatory installation on all new homes (and ALL bathroom/kitchen renovations) and the later on all new commercial buildings. Solar water and not straight to PV is recommended for homes as the hot water storage cylinder is a battery without lithium.

  19. David, you’d be absolutely right – if NZ had a planned economy along the lines of the former Soviet Union (and the planner were as wise as you, of course).

    But before you dismiss hydrogen as “inefficient”, you might like to reflect on the number of utes and SUVs in your local supermarket carpark, each ready to haul their single bag of groceries all the way to the next suburb. Each of those vehicles represents a substantial capital investment by someone — someone who apparently doesn’t share your views on the supreme importance of efficiency in engineering.

    Commercial success doesn’t require that a product be efficient. It doesn’t even have to make sense. It just needs to convince the right person, at the right time, that it’s ideal for the purpose they have in mind. On that front, I’d say hydrogen is doing pretty well.

    1. Summary:

      It’s going to cost a couple of billion.
      We hope to start building in the second half of this year.
      We don’t know how much of Tiwai Point’s electricity we will be able to get or what it will cost us.
      We don’t have a customer yet.

      …and the government takes these people seriously.
      Meridian Energy; 51% government owned. Time to sell my shares.

      1. I suspect this is positioning to allow Meridian, Contact and the government to bargain hard with Tiwai Point when the next electricity pricing review comes up.

        Normally once you’ve identified the customer, established the rough sizing and location, there is a Front End Engineering Design phase where the high level design and +/- 10% costing is established. Also obtain things like Resource Consents (if any), easements for pipeline and roading access. Once all that’s done the board(s) will give the green light and detailed design, procurement and construction can start.

        If they’re only at RFP stage and don’t have the land secured yet I can’t see them getting through the first two steps by the later half of 2022. Even before you add the current worldwide difficulties with supply chains.

        I also note this is the “the world’s first large-scale green hydrogen plant”. That’s not actually true, but still the risks involved in being an early mover are huge.

        1. Quite so. I am more than familiar with developing projects though concept, pre-feasibility and feasibility. Familiar enough to recognise a fairy story when I see it.

          Everything I have seen from this government and their corporations regarding hydrogen projects is clouded with Orwellian doublespeak and obfuscation, smoke and mirrors.

        2. The elephant in the room that needs to shove of ASAP is Tiwai Point. 17% of our precious electricity is being turned into heat, the lowest grade energy and sold for a pittance courtesy of NZ consumers. As for hydrogen fuel cells at scale, they’ve been ‘just around the corner’ for a generation and the cost of obtaining rare catalysing metals can’t ever be cheap. Did anyone notice the irony of our Minister of Energy pictured with a hydrogen FC truck whilst bagging EVs? His claim that 1000 EV batteries expiring each year already is risible and overblown. We need to get the smelter out, and Manapouri connected to the grid properly, as a priority. Enough of the ‘fool cell’ spin.

  20. I agree with the author.

    Except for arid countries, any country with a water source can produce hydrogen and probably do so cheaper than importing it from NZ.

  21. Good post David. Well and truly time to burst the hydrogen bubble…but there is more to be said:

    “Ardern said its versatility, low weight and wide range of uses could make it a particularly valuable and sought after export commodity NZ was “uniquely placed” to produce.”

    NZ is not “uniquely placed” to produce “green” hydrogen. The NZ government is a victim of its own propaganda as evidenced by the “green paper” published in September 2019. Plenty of marketing hype about “visions”, partnerships, claims that “New Zealand has an abundance of renewable energy” and “Thanks to our
    abundant renewable energy, New Zealand can produce some of the cleanest green hydrogen in the world, and potentially receive a premium for it in international markets.

    The Green paper was hype piled on hype with a side of bullshit. A 2nd year mech. engineering student (good at thermo.) and a first year economics student could have done a better job (providing, of course, that the primary purpose of the paper was not a sop to the Taranaki oil and gas industries).

    Every booster for hydrogen as an energy vector should be required to produce a Sankey diagram. That would demonstrate how much energy is frittered away on each of the many conversions and losses in the whole sorry mess that is electrical storage and transmission via hydrogen.

    Every claim of companies “investing” in hydrogen projects should state how much government subsidy they are receiving and what proportion of the overall “investment” that constitutes.

    1. Thanks MFD. Actually New Zealand currently has a deficit of renewable green energy.

      On average, everything above about 86% of generation capacity is produced by hydrocarbons. The actual amount will vary with demand, time of year, lake levels etc. But the last MW is always coal or gas.

      So the next new Tesla, or the new hydrogen electrolysis plant, are both adding additional demand – which will be provided by hydrocarbon generation.

      In future this gap is supposed to be closed by adding additional wind, solar and geothermal generation. This will happen, but with the current market model the major generators are incentivised to keep the marginal power on coal or gas.

      If there ever is structural surplus green power, the overall price will drop and the Gentailers profits (and government shareholder dividends) will slide.

      The government answer will be that Lake Onslow NZ Battery project will resolve this. But it wont and may make the situation worse. A rather poorly thought through concept.

      1. “Actually New Zealand currently has a deficit of renewable green energy.”

        I am confident in stating that most folks that frequent these pages are aware of that, David…so why the government claims re NZ’s unique position wrt surplus renewable energy? Why the puffery and fantasy surrounding hydrogen?

        “So the next new Tesla, or the new hydrogen electrolysis plant, are both adding additional demand – which will be provided by hydrocarbon generation.”

        As is the next house, factory office block, toaster, heat pump or electric train…until they are not. It’s the electricity “market” that is broken.

      2. Your comment stating the last megawatt is always gas or coal is so true. The only time in the last year that gas and coal were turned of was during the lock
        down due to lack of demand even then the grid was only 96 percent renewable because of cogeneration using coal and gas mainly at Glenbook and some of the larger dairy milk dryers. So all this free energy that is generated at night is a myth the moderator should go back through the at least half a dozen posts on this thread that allude to there being all this wasted power generated at night and delete them its a myth or maybe even misinformation on the scale of vaccines turning you into a magnet. Coal and gas power stations are run at night and hydro iis throttled right back so the water can be used during peak periods. Repeat after me there is no wasted power being generated there has being unnecessary spilling oncr that we know off but its doubtful that Contact or Meridian would risk doing it again.

    1. 🙂 We stand on the shoulders of giants.

      The other quote I like is the Doors from Roadhouse Blues – “The future’s uncertain and the end is always near”

    1. It’s not us that needs to read it, Russell; it’s our minister of energy and our prime minister. They have been played like cheap fiddles.

  22. In reading this article and comments one is reminded of the three blind men trying to describe an elephant. The many faceted roles of hydrogen in the energy economy are difficult to describe in a short article. For light commercial and heavy transport, where downtime is important, the cost of sufficient charging infrastructure to eliminate wait times for vehicle battery recharging is somewhat of an inconvenience that is already being experienced in Europe. The cost of a megawatt charging station is not trivial and is actually more expensive than providing a hydrogen service station. Not often discussed is our dependence on fossil fuel, 550 Pj vs our electricity production 155 Pj. This does not take into account decarbonising our international flights or shipping. Our current capacity for this amount of energy from renewables from solar wind and geothermal is resource constrained. The nuclear option may have to be considered within the next decade. Alternatively, what is consistently ignored is the role of the oxygen byproduct from electrolysis that can be utilised for natural gas combustion with carbon sequestration in a very efficient Allam cycle. Proton energy is mining hydrogen from depleted oil wells at less than $1/kg. Electrolysis is not the only source of low carbon hydrogen. Then there is the role of hydrogen in e- fuels. CRI in Iceland is converting geothermal electricity into low carbon methanol by hydrogen reduction of carbon dioxide. Will transition to a low carbon economy be expensive? Will it involve major expenditure in large projects? Yes to both, but haven’t we declared a climate emergency? So far our response has been timid, to say the least.

    1. The nuclear option is only “required” if we believe in “predict and provide” methods instead of “decide and provide”. Let’s not give up on humanity being able to adjust its values and lifestyles quite so hastily.

      You seem to be missing the “Avoid” and “Shift” parts of decarbonisation, Wallace. In heavy transport that means shifting to rail, electrification of rail and a logistics plan to optimise that, plus a full people-focused discussion about the limits to growth and materialism – with a challenge to the assumption of ever-increasing freight volumes.

      You also mention light commercial vehicles, where there is significant “avoid” and “shift” potential. And you mention decarbonising our international flights and shipping. “Avoid” is important for both these, and “shift” for the first one.

      “Will transition to a low carbon economy be expensive.” You say yes. I say it will only be expensive if we keep subsidising sectors so they don’t have to use “avoid” and “shift”. The ongoing subsidies to aviation including from governments to help with “research and development”, after decades of pollution in excess of their promises, is one of the most inequitable situations in the whole transport field. If aviation had to pay for its climate damage, and for its research and development out of ticket prices, the whole sector would be wound back considerably – with major improvements for the climate.

      1. I agree with an avoid and replace policy, except I don’t see any evidence of it. Car ownership has increased from 200/1000 in the 1950’s to 900/1000 now. With an importation rate 0f more than 80,000 pa. We are still spending billions on new highways instead of railways and cycleways.
        Will Aucklanders willingly reduce their car ownership anytime soon?
        For the immediate future, we are committed to road transport for essential supplies.

        1. Our car ownership and vkt are a result of investment choices. Car ownership is dropping in many parts of the world. The trend can and is being sped up with good planning – eg implementing low traffic neighbourhoods and cycling networks.

          Our egregious car ownership and vkt statistics need highlighting in order to show how poor our policies have been, not to accept them as some kind of natural state or worse, something that will continue to worsen.

          Avoid and shift are part of official mode shift policy. Do you mean you’re struggling to find evidence that it’s being applied? Well yes, emissions reductions policy via vkt reduction and mode shift is being hotly resisted by the sector, despite their great narratives. But that has to change, and there are many people working within the sector trying to do just that.

          They are not helped by people believing that change is too hard. “Will Aucklanders willingly…” is not a healthy question. Aucklanders want healthy transport options and quieter streets. When the system is biased and supports poor transport choices, there’s no benefit to be gained by looking at “willingness” to do anything.

          Behaviour change follows systems change.

    2. “In reading this article and comments one is reminded of the three blind men trying to describe an elephant”

      Is one? Remarkably condescending of you considering that you cannot manage the correct symbol for joules.

      Are you able to provide commercially-viable examples of these many faceted roles of hydrogen? Where, for example, can I buy proton-mined hydrogen at less than $1/kg? What’s the price of electricity from one of those Allam cycle plants using oxygen from an electrolyser?

      From an economic standpoint these hydrogen “roles” are vapourware.

        1. A non-commercial pilot plant, an unverified cost claim by the CEO who is touting for investment on his company’s website.
          A claim that they believe that the most of the CO2 they produce will react with rock to produce carbonates…and if doesn’t, well it will be a liquid and it shouldn’t escape into the atmosphere. A premise that old oil wells are free or very cheap (even after their company supposedly starts making big profits from them).

          …and you believe their cost projections? Just how naive can you get?

        In the work conducted by Mitchell et al. the net cycle efficiency can increase to 66.10% when the Allam cycle plant is run on stored oxygen, increasing the net electric output by 17.67%, through the avoidance of oxygen production penalty. Because the only emission is pure carbon dioxide, sequestration is relatively straight forward.

        1. The Allam cycle requires oxygen if NOx emissions are to be avoided.
          Producing oxygen requires energy.
          If we ignore that energy by using “stored” oxygen the claimed efficiency can be improved.

          By that “reasoning” why not avoid the whole mess and just buy batteries at Mitre 10 and run the whole electricity grid on stored energy from AAs?

  23. In reading this debate there are some very biased misnomers. We agree on 3x points
    1. International Hydrogen trading is futuristic, not investable right now
    2. EV’s are the decarbonisation future in NZ and Aust
    3. As the NZ HV Grid becomes the petrol station we need circa +1000MW of Wind Solar Geothermal additional capacity and fast

    However, the writer nor the contributors know of the latest capex and output costings of Electrolysers. Fuelled by renewables the hydrogen price is very competitive and well under diesel.
    For longer haul buses and trucks hydrogen works well, after all a hydrogen vehicle is just an EV with its own onboard battery charger. You will see more and more green hydrogen fuelled Buses and Trucks in NZ in the future as the Australasian Govt’s decarbonisation plans kick in.
    Their is a practical side to this debate which the original author does not introduce

    1. More than 1000 MW of wind and solar projects were launched last year: and it is possible that as the solar industry expands as it appears to be, farms will be able to be built quite quickly. I think that side of the equation is looking quite positive. ETS price of $80+ is making a difference.

      But I agree with David K that Meridian’s announcement is all about positioning re Tiwai Point. Tiwai really threw a spanner in the works with their announcement that they may stay open, which (if it had been announced a couple of years ago with contracts locked in) would have been a good thing. But now time is getting short to plan for 2025.

    2. “after all a hydrogen vehicle is just an EV with its own onboard battery charger”

      A special type of EV that requires around 3 times the electrical energy that a BEV requires to do the same job. That’s the elephant in the room that promoters of hydrogen just don’t want to address. That’s 3 times the requirement for additional renewable generation and distribution. Your electrolysers could be free and it wouldn’t change the fact that going down the FCEV route is a profligate waste of energy.

      1. Not so sure about 3x. With an FCEV you do get regenerative braking due to a substantial battery which is necessary to optimise the fuel cell load. WTW efficiencies data I have seen quoted 75% for BEV and 30 to 38% for FCEV. The more realistic comparison of energy utilisation is with diesel and even then it is the total cost of ownership.

      2. Secure carbon capture: There are two options
        1. Injection into reactive rocks. CRI has successfully established this technology at scale in Iceland.
        2. Utilise our geology. Numerous natural accumulations of CO 2 already exist underground in geologic reservoirs and
        have been stored for millions of years.

        With regard to Proton Industries technology. As an emerging technology, some degree of scepticism is perhaps justified but the number of licences being negotiated leads me to think this will become a viable technology. The CO2 is either left in place or reinjected into reactive rocks.

  24. Reading the article and comments. There are a few points that might be noted. Japan’s first liquid hydrogen tanker ship ‘Suiso Frontier’ is scheduled to arrive at Kobe with the ship’s first load of Australian hydrogen on the 24th February, 2022 (21:00 UTC)
    The Port of Los Angeles, USA has been trialling Class 8 hydrogen fuel cell truck tech since 2011. They were still bringing new hydrogen fuel cell trucks in 2021 to run.
    Vision Industries – Port of Angeles hydrogen fuel cell truck Even Cummins, better known as a diesel engine maker is seriously investing in hydrogen fuel cells for heavy vehicle use.
    With the amount of money being put into hydrogen, battery and electric vehicle tech there are very likely to be some key new developments in the next few years. The new tech could be combined for synergies. e.g Using ultracapacitors with HFC buses.

    1. That hydrogen is made from coal. What proportion of the energy from that coal do you think is actually going to arrive in Kobe in the form of hydrogen taking into account the efficiency of gasification, the water gas shift reaction, local transport, liquifaction and boil-off during the sea voyage? 20%, 25%?
      How much CO2 is produced per kg of hydrogen?
      If making hydrogen from coal in Australia and shipping it to Japan as a liquid is the answer then what was the question?


          Extract from submissions to the Hydrogen “Green Paper”:

          “A large network of refilling stations will not be required to start with, but a commercial model will take time to develop due to small scale operations to start the transition. On that basis, it may be beneficial to look at incentives and support to create a basic network of refuelling stations to get to some sort of scale. (BP New Zealand) “.

          Give us subsidies, says BP.

  25. My opinion on all these “innovations” is that they’re distractions from the facts that existing technology (i.e. rail, mass transit walking, cycling) can achieve a lot if not all of the positive environmental goals that EVs, hydrogen, etc. are claimed to do. Heck, trolleybuses are more energy-efficient than battery EV buses; but somehow stringing up a few overhead wires is “too hard” and “too much visual disruption”

    It seems that there’s a motivation to prevent systemic change. Why increase urban density and active mode/mass transit provision when you can just tell suburbanites that they can buy Teslas and save the planet?

    I’m not against hydrogen or electric vehicles, I think they do have a part to play, but that part should be *minor* and nowhere near as heavily emphasized as they are at present. It’s why I’m increasingly suspicious of tech bros claiming the perfect solution to a given issue.

  26. I agree with David K opinion. As a country we need to stop looking at future through our neoliberal ‘here and now’ tinted glasses and start to do some serious out of the square long term thinking and planning to try to future proof the country from increasing global geopolitical, manufacturing, supply chains, health, economic, trade, etc uncertainties and unpredictable disruptive effects of a warming planet.

    New Zealand needs to start become more sufficient and less reliant on the high number of imports that we have been addicted to over the last 35 years.

    There is no reason why this country can not have 100% renewable power with the remaining approximately 15% made up of network hubs of home generation feeding surplus power generated back to the national grid.

    If the smelter at Tiwai Point closes, we should be manufacturing green hydrogen for domestic consumption to power cars, urban and regional passenger trains, buses, etc.

    Battery technology is improving with the sold state batteries for cars, etc going into full production from 2025.

    We should looking at how it can happen instead of looking at the reasons why we shouldn’t do it.

    1. Conversely, getting caught up in grift/boondoggle innovations or pretending that one thing is the solution we have to focus on for power or transport is a very neolib thing to do.

      Hydrogen has its place, sure. But such an emphasis on it is harmful to other renewable energy sources; to the need for mass transit & active modes. The establishment will just hijack the whole idea and push heavily for fuel cell vehicles with no change to suburban sprawl infrastructure.

      Long-term planning also needs to encompass wind, solar, geothermal, tidal power – heck, maybe even nuclear fission or fusion power. It needs to prioritize electrified mass transit, walking, cycling, and e-bikes, as backed by evidence.

      The need for change is urgent, and as much as possible existing proven technologies should be adopted and expanded upon, since that will be quicker than waiting for innovation and optimization of new tech.

      1. There is no reason why NZ can’t have 100% renewable power generation without using nuclear generation.

        There is no reason why NZ can have a national networks of hydrogen fuel/battery and electric and hydrogen fuel/battery powered urban, regional and regional passenger and freight trains and fleets of hydrogen fuel cell/battery powered buses connecting communities across the country.

        There is no reason why NZ can’t be designing and building sustainable, environmentally friendly housing developments based on public transport, walking and cycling like Sunfield in Auckland and using vacant brown fields in urban centres for infill housing.

        All this available now but NZ is country of armchair experts, theoretical consultants and voters that like having talk fests on what should be happening but in reality sit on their hands an do nothing, as they don”t like and moan when there is change.

        1. See, this – this is the techbro mentality that I 100% disagree with and find frustrating. It comes across as based entirely around the predetermined conclusion that ‘hydrogen is the ultimate answer’ and fitting evidence to that conclusion.

          I reiterate my last point – there are other, longer-established technologies that can provide the same benefits that you claim hydrogen can. Trolleybuses, light rail, heavy rail, renewable wind, solar, hydro, geothermal, tidal. There’s no reason why we can’t focus on those as part of a truly integrated transition away from fossil fuels, with hydrogen being just one component of the equation.

          To overemphasize hydrogen above all those is really quite disingenuous, biased, and unhelpful – like claiming that battery electric vehicles will make public transport obsolete.

          And where did I insinuate that I was against urban intensification? I would debate the point that Sunfield is a good example of a “sustainable development”, seeing that it is essentially more greenfields sprawl far away from any mass transit. There must be a greater emphasis on intensification of the present urban areas before we let developers take over native bush and quality horticultural land.

        2. Matt Bear – I am not sure where you got he impression that ‘hydrogen is the ultimate answer’.

          I totally agree that electrical power generation can be from wind, solar, hydro with the remaining 15% made of made up of network hubs of home solar generation feeding surplus power generated back to the national grid.

          I am not sure why you are oppose to hydrogen fuel cell/battery powering rail and road transportation.

        3. Kris – I have become accustomed to some who promote particular technologies as uncritically presenting it as a “solve-all solution.” E.g. Tesla & Boring Company fanboys are probably one of the worst offenders, constantly cherry-picking mass transit costs and unrealistically hyping the “capacity” of autonomous cars in narrow tunnels.

          Home solar panels (and wind turbines? Especially in Wellington perhaps) would be a game changer for the energy sector.

          My concern with hydrogen vehicles is the same as with battery-electric vehicles, that by focusing on one relatively new technology (rather than an integrated combination of proven methods and the best of new innovations) politicians and non-expert authorities will get swept up in hype and start implementing tech where it isn’t suitable. E.g. the tearing down of Wellington’s trolleybus network to replace it with battery buses, or using battery/hydrogen trains as an excuse to not electrify key lines, or the claims from pro-car quarters that electric cars make public transport unnecessary.

        4. Matt Bear – The reality is that hydrogen fuel technology for passenger trains and urban buses is here know. Siemens, Stadler, Alstom already have a range of urban and regional hydrogen fuel/battery passenger trains, especially Alstom, who launched the Coradia iLint in 2018 for urban and regional use in Europe and is performing better than expected after 4 years of operation.

          Alstom is launching the Coradia Polyvalent H2 being a bi mode electric and hydrogen fuel/battery 4 carriage train set with speeds up to 160kph for France’s SNCF for regional passenger services in France.

          I agree about the Wellington trolleybus network and its should have been be incorporated into the current network due to their good hill operations. Trolleybus electric/battery operation has improved and the former tag axle trolley buses could have been replaced with new electric/battery operation trolleybus using then existing overhead. I would like the current hydrogen fuel cell/battery bus being used in Auckland to go to Wellington and tested

          Yes, I agree that the North Island main truck rail line should be fully electrified from Auckland to Wellington and also between Auckland and Tauranga.

          As I already mentioned, we need to stop looking at future through our neoliberal ‘here and now’ tinted lens and start looking at how it can happen instead of looking at the reasons why we shouldn’t being do it.

    2. “If the smelter at Tiwai Point closes, we should be manufacturing green hydrogen for domestic consumption to power cars, urban and regional passenger trains, buses, etc”

      Why? It would be the height of folly. A great way to take high quality renewable electricity and waste most of it heating up the atmosphere while spending billions in capital.
      You can’t beat thermodynamics.

      1. Jo is correct. There is no reason why surplus electrical power from Manapouri, if Tiwari Point smelter closes, to be used for the production of green hydrogen for domestic consumption.

        1. Surplus electricity?

          Option 1: spend several billion dollars to build a hydrogen production facility and distribution infrastructure to deliver 19% of Manapouri’s output as electricity and the other 81% as heat into the atmosphere.

          Option 2: Spend a fraction of the above sum to build an HV line and additional HVDC transmission to deliver 93% of Manapouri’s electrical output (with 7% lost as heat) and make NZ’s electrical grid 100% renewable.

          Why are you so keen on the ludicrous option?

  27. In reply to MFD re Allam cycle. The by-product from electrolysis, oxygen, allows an increase in the efficiency of the Allam cycle. In considering the total hydrogen energy cycle commentators do not give credit to the value of a pure oxygen stream.

    1. The Allam cycle claims to generate electricity by burning natural gas in a manner that enables carbon capture and storage.

      It requires oxygen to function.

      The manufacture of oxygen requires electricity (and the paper by Mitchell et al. specifically calls for “stored” liquid oxygen).

      If we ignore the electrical energy requirement for this liquid oxygen the Allam cycle becomes more efficient (!).

      Would you like to ignore the energy required for the carbon capture as well, Wallace? That would make your cycle even more efficient? How about the energy absorbed by the compressor as well? With a bit of imagination and sleight of hand you could even exceed the Carnot efficiency for the cycle. That really would be quite an achievement.

      The reality is that if natural gas is the input and electricity the output AND the source of oxygen is electrolysis then the electrical requirements to produce the oxygen and turn it into a liquid then turn the hydrogen produced into electricity will have to be deducted from the electrical output of the Allam-cycle generation plant.
      The efficiency of said plant will be dragged down and beaten senseless by the abysmal round trip efficiency of the electrolysis/fuel cell combination and the electrical energy requirements of cryogenic oxygen.

      Enough of the smoke and mirrors, Wallace.

      1. I’ll just repeat that the oxygen is virtually free as a byproduct of electrolysis and is not given credit for in the production of hydrogen.

        The basis of the Allam technology is the Brayton cycle that uses supercritical carbon dioxide. Combustion with pure oxygen eliminates the need to compress nitrogen that would result from air combustion. Excess carbon dioxide is simply bled off, hence the energy required to sequester carbon dioxide is relatively insignificant with a resulting increase in efficiency

        1. Repeat as often as you like, Wallace. There is no free LOx from an economic or thermodynamic standpoint. An argument for a process that relies on such a claim is invalid.

Leave a Reply

Your email address will not be published. Required fields are marked *