Rowan Ramsey (Grey, Liberal Party) Share this | Hansard source

Green hydrogen offers great hope, not just for Australia but for the world, when it comes to the task of the transformation of our energy network—the shift from fossil fuel to renewables.

Sitting suspended from 17:51 to 17:56

As I was saying, the important thing about transition is that the price of the renewable becomes lower than the fossil fuel that is available now. While we in the developed world can put restrictions on ourselves—we can raise the price of fossil fuel; we can wear a hair shirt, if you like—it won't make a significant difference to the fossil fuels that are consumed in the rest of the world. The path to sustainability, the path to renewable energy, is to make the renewable energy and make sure that it is cost-competitive and undercuts fossil fuel. Then, of course, the world will beat a path to your door.

Hydrogen offers great hope. The National Hydrogen Strategy said in only November last year that the magic figure for production and transportation to the point of usage is around $12 to $14 a kilogram for hydrogen produced to compete with distillate and petrol. To replace gas heating, you would have to produce hydrogen for around $1.20 a kilogram, so that's a little way away yet. We've got quite a bit to go.

However, it's worth contemplating that South Australia leads the renewable energy charge across Australia. We have 2,300 megawatts of installed capacity of wind and large solar in South Australia. Around 1,700 of that, I might add, is in the electorate of Grey. There is 1,080 megawatts of rooftop solar. When that's all up and operating, that's more than enough to run South Australia. In fact, the grid has become quite unstable, to the point where AEMO is now restricting large wind generators to 1,300 megawatts at any particular time because, if they allow for more than that to be generated and fed into the grid, it puts pressure on the baseload generators that are underwriting the system, that hold it all together.

The great possibility here is for the transition fuels for storage. In South Australia, we have four different options, I think. One is the interconnector proposed by the South Australian government, which will go directly through to New South Wales and, by dint of that, will actually connect with Snowy Hydro 2.0. We are also providing money to build up the business cases for two or three local pumped hydro projects, which will give anything up to eight or nine hours electricity at full tilt.

There has been a big investment and expansion in batteries. I'm the first to sing the praises of batteries inasmuch as they provide a very special role in balancing both frequency and voltage. They are instant responders, if you like. There is more investment going into batteries, but as far as I can tell, based on everyone I speak to in the industry, it's widely accepted that the technology in batteries is nowhere near providing the deep storage capacity that we need, that can back up a system that is not generating for hours or one day or two days at a time because the wind's not blowing.

At this stage the most important transition energy source is gas, and we should be making sure that we use the gas that we have been provided with in Australia. But there is a space for hydrogen in there, and hopefully, in the first instance, it will come for firming up operations. But if we can get the price cheap enough, and experience shows the more you invest in an area the more likely you are to get there, then perhaps we can get it down to the stage where it can provide baseload electricity on a repeatable basis. We must remember though, if we want to produce 50,000 tonnes of hydrogen a year from a renewable, intermittent energy source, we might have to build a plant that has 100,000 tonnes a year capacity. So somewhere along the line you pay the price: you build for overcapacity to compensate for the intermittency of the electricity generation at the first point. I'm sure I'll get to add to this at another time, because it's a subject I feel quite passionately about.

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