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Hydrogen House at RMIT April 2021: speech by Dr Alan Finkel

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Speech

12 April 2021

A girl was crossing the road one day when a frog called out to her and cried, "If you kiss me, I'll turn into a handsome Prince.”

She bent over, picked up the frog… and put it in her pocket.

A little while down the road, the frog spoke up again and said, "If you kiss me and turn me into a handsome Prince, I will stay with you forever.”

The girl took the frog out, smiled at it, before putting it back in her pocket and continuing on her way.

Stunned at her silence the frog spoke up again, "If you kiss me and turn me into a handsome Prince, I'll stay with you forever and shower you with gifts.”

Again, the girl took the frog out, smiled at it and put it back in her pocket.

Exasperated, the frog finally demanded, "What is it? I've told you I'm a handsome Prince, that I'll stay with you forever and that I will shower you with gifts…Why won't you kiss me?"

The girl said, "Look, I'm a computer programmer. I don't have time for boyfriends, but a talking frog is really cool."

***

There are many morals you could draw from this parable, but the most relevant one is, that in real life, there are choices to be made.

And moments to be seized.

We’re in such a moment. We all know what needs to be done.

Reduce emissions to zero

So, what tools are at our disposal?

Demographers would argue that population control is the answer.

Vegans would argue that the key is eliminating meat, dairy and eggs from our diet.

Economists would say the most efficient tool is a global carbon tax.

Each would argue their solution is ideal. But none are practical.

Population control? It’s been debated for decades. And while the debates rage, our population continues to rise.

A vegan diet? I’ve been giving speeches for years now where I suggest that a global vegan diet would dramatically reduce agricultural emissions. But the audience merely giggles in response.

And, as for a carbon tax, while the vast majority of people want to reduce their emissions, a carbon tax’s appeal rapidly diminishes once they become aware of the added cost to their everyday consumption.

How, then, do we change the practices of our civilisation?

We make a plan.

The plan must be ambitious but not naïve.

It must keep costs low and ensure services remain reliable.

The plan must focus on large-scale technology and policy solutions.

In short, an investment plan to help new and emerging zero emissions alternatives become cost-competitive with our high-emission incumbents.

Replacing our 19th century energy sources with 21st century clean alternatives.

Technology to solve technology’s problems.

A Green Discount

In the early days of the technology adoption curve, the price for the new and emerging solutions carries what Bill Gates calls a ‘Green Premium’ – the additional cost of choosing a clean technology over an incumbent that emits greenhouse gases.

In simple terms, our goal must be to turn that Green Premium into a “Green Discount”.

How do we get there?

In Australia, the journey is already underway, driven by Commonwealth, State and Territory government, and private sector, action and ambition.

At the Federal level:

  • the Renewable Energy Target (RET) has attracted solar and wind generation into the system
  • the Australian Renewable Energy Agency (ARENA) and the Clean Energy Finance Corporation (CEFC) are assisting industry with demonstration projects and large-scale deployment
  • the Emissions Reduction Fund (ERF) draws down carbon dioxide from the atmosphere through biosequestration and other means.

In recent years, we’ve benefitted from the reform of the National Electricity Market (NEM), the adoption of the National Hydrogen Strategy and, most recently, the release of last year’s Low Emissions Technology Investment Roadmap.
The goal of the Roadmap is to continue to hasten new and emerging technologies down their cost curve, through co-investment between governments and industry, so that the green premium is whittled away.

Once this occurs it will trigger a tipping point where going green is no longer a financial disadvantage.

And it is well within reach.

We’ve already seen the Green Premium for solar and wind electricity become a Green Discount.

In transport, electric cars currently sell at a Green Premium, but Bloomberg New Energy Finance is predicting that in just a few years time, battery electric cars will have a lower purchase price than equivalent petrol cars.

At that point, battery electric cars will benefit from a Green Discount and sales will surge, driving prices down even further.

Australia’s renewable energy

As of last year, 28% of Australia’s electricity came from zero emissions renewable energy.

This is a wonderful achievement and testament to the collective efforts of the Australian community.

But we need to get to 100%.

And then keep going, until we reach have enough clean electricity to replace all of the:

  • petrol currently used in transport
  • natural gas used for heating and cooking
  • coal used for industrial steam generation.

Achieving all of this would eliminate three-quarters of humanity’s greenhouse gas emissions.

Creating a world where energy is clean, cheap, and plentiful and is supporting jobs in all sectors of the economy.

But now we get to the hard part.

Emissions from agriculture, industry, waste and land use

Emissions in these sectors will take longer to reduce and will probably never quite get to zero.

Plus, the pathways are unclear.

Agriculture contributes 67 million tonnes of emissions in Australia. The vast majority of this, 55 million tonnes, is methane emissions from cattle and sheep, released into the atmosphere when the animal belches.

Collectively, those puffs affect our climate because methane is a greenhouse gas twenty-eight times more potent than carbon dioxide.

Or take the production of cement, responsible for 5% of global carbon dioxide emissions. Most of those emissions are a by-product of a chemical process that currently, nobody knows how to reduce.

We urgently need more research in these areas.

And this rests heavily on our universities.

As a reservoir of ideas, we need your vision and inspiration to forge the path forward.

Surely solving these challenges would be enough. Not really.

  • We still need a high-density source of transportable fuel. 
  • We still need an alternative chemical feedstock to make the ammonia used to produce fertilisers.
  • We still need an alternative to high-purity coal as the chemical reducing agent to make steel.
  • We still need a means to carry clean energy from one continent to another.

Don’t panic.

Enter stage left: hydrogen.

Clean hydrogen’s time is well and truly here

Japan aims to import up to ten million tons of hydrogen annually by around 2030.

South Korea aims to have 300 hydrogen refuelling stations, 2 thousand fuel cell buses and tens of thousands of fuel cell cars in use by the end of next year.

Germany has committed 9 billion euros to hydrogen for just this decade. France 7 billion.

With the price of solar and wind farm electricity plummeting globally in the last decade, by 82% and 39% respectively, the cost of producing clean hydrogen today is within a factor of three or four of where it needs to be to compete with fossil fuels, and the gap is set to close rapidly.

But we still need to make the gadgets that produce hydrogen – the electrolysers, the compressors and the safety equipment – much more efficient, and cheaper.

The numbers are staggering.

To produce as much hydrogen for export as our current natural gas exports, we will require:

  • nearly a million megawatts of electrolysis
  • cheaper ways of liquefying hydrogen gas for transport
  • millions upon millions of cheap and effective hydrogen gas sensors for safety monitoring.

Opportunities in hydrogen research

These enormous challenges should not be viewed as obstacles but as opportunities.

It means there are lots and lots of avenues for incremental benefits stemming from more and more research.

The supply of hydrogen in 2050 is expected to be a trillion dollar industry.  If we can improve the hydrogen production efficiency by just 10%, that will save $100 billion annually across the world economy.

To solve all these cost issues, we need flourishing partnerships between researchers, industry, and State and Federal governments.

We need focus, world leading research institutions such as the Sustainable Hydrogen Energy Laboratory, and the Centre for Advanced Materials and Industrial Chemistry, and the Advanced Materials Centre here at RMIT University, and leaders such as Professor Suresh Bhargava and Associate Professor Bahman Shabani, and their colleagues.

I therefore urge you to focus on what will make the hydrogen industry more cost-effective.

Under the Low Emissions Technology Statement, the Federal Government plans to invest $18 billion over the next decade in new technologies to reduce emissions.

The first version of the Statement, released in September 2020, committed nearly $2 billion as an immediate down payment on our future.

Version 2.0 of the Statement will be released later this year, and the Government has committed to table an updated Statement in Parliament every year.

There are also many corporate investors interested in hydrogen, and they will fund research – provided it makes a compelling case for safety, efficiency or lower cost.

Concluding remarks

My advice to you is to think strategically. Be proactive. Reach out and find another collaborating university. Find companies with similar interests. Create a consortium.

In short, shine a light on the future benefits that your research and development can deliver.

The International Energy Agency has stated that 50% of what we need for a zero emissions future is already at our disposal, but the other 50% will require intense research.

And so, in the years ahead, you will have the responsibility as well as the opportunity to help solve these problems.

To develop the breakthroughs that hold so much potential to provide so many benefits.

This is the role that history offers us.

Let us accept the challenge – not as a burden, but confident in the ingenuity and innovation at our disposal.

This is our call to greatness.

Let us kiss the frog; seize the moment.

May the Force be with you.

Thank you.

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