Sasol takes another green step forward with proposed hydrogen plant

Not all hydrogen is created equally – this stuff will be really green.
Hydrogen reacts with platinum and oxygen to produce electricity with a few drops of water vapour as the only emission – but a lot of electricity is needed manufacture it. Image: Patrick T Fallon/Bloomberg

Hydrogen fuel cells have been offered as an alternative energy source for decades.

In South Africa, Anglo American has been funding fuel cell technology development since the days when Rustenburg Platinum was a separate listed company. Then CEO, the outspoken Barry Davison, often criticised his competitors for not making a decent contribution to fund this research.

The explanation for his entertaining outbursts was not motivated by sympathy for the green cause, but because fuel cells contain platinum metals and demand for platinum was quite weak at the time.

In addition, all the platinum mines had just finished a round of expansions – and then demand for platinum promptly plunged.

It looks like hydrogen fuel cells are eventually making some headway on the local front.

It is one of the avenues Sasol is investigating to reduce its reliance on fossil fuels in delivering on its promises to become a green energy company.

In September 2021, Sasol and Imperial (one of SA’s major logistics companies, which operates one of the biggest fleet of trucks) announced a joint venture to look at moving away from diesel engines towards trucks powered by fuel cells.

Read:
Sasol maps out its future
Sasol, Toyota team up to test fuel-cell heavy duty vehicles

“For heavy commercial vehicles travelling long distances, fuel cell electric trucks hold promise as a viable zero-carbon solution,” the JSE-listed companies said in a joint statement.

“Sasol’s expertise in hydrogen production and refuelling infrastructure, combined with Imperial’s expertise in fleet management and its extensive transport footprint, are expected to deliver good synergies,” the partners added at the time.

These comments explain both the benefits of fuel cells and the challenges.

One problem …

Several (academic) research studies that looked at the viability of hydrogen fuel cells, and others that compared it to using modern batteries, note that the main problem with fuels cells is that they need refuelling, and special equipment to do so.

Transporting hydrogen is also more difficult than petrol and diesel.

There need to be a lot of hydrogen-electric trucks on the road before hydrogen pumps become viable next to the usual petrol and fuel pump.

Sasol, owning a chain of filling stations and the capability to manufacture hydrogen, keeps the door open.

The need for green

While hydrogen fuel cells deliver clean energy – hydrogen reacts with platinum and oxygen to produce electricity with a few drops of water vapour as the only emission – the process to manufacture hydrogen is not environmentally friendly. It uses a lot of electricity.

Using Eskom’s coal-based electricity to manufacture hydrogen defies the green intention, very much the way using the national grid to charge an electric car in SA does.

This week’s announcement that Sasol has committed to building a plant to produce hydrogen using only renewable energy removes this hurdle.

Minister in the Presidency Mondli Gungubele visited Port Nolloth to launch the Boegoebaai green hydrogen project this week and engage with stakeholders, including a delegation from Sasol, Infrastructure South Africa and the Northern Cape Provincial Government.

This follows just a few months after a memorandum of understanding (MoA) to develop the project was signed with Sasol, in October 2021.

Read:

Gungubele pointed out that green hydrogen was identified as a “Big Frontier” that represents both future and current growth and investment opportunities for SA.

“Globally, the demand for green hydrogen [dubbed H2] and green hydrogen-based products, such as ammonia and synthetic jet fuels, is rising,” he said.

“Due to the multi-sectoral implications of green hydrogen, the presidency plays a convening and coordinating role across government with respect to green hydrogen.”

SA’s eye on green hydrogen

Gungubele said SA has a long history investigating green hydrogen. “Since 2007, the Department of Science and Innovation has been researching green hydrogen with a focus on green mobility and the use of the platinum group metals.

“Over the past two years there has been a proliferation of net zero commitments by nations and corporations. This has brought into renewed focus a need to decarbonise traditionally ‘hard-to-abate’ sectors such as heavy duty transport, aviation, maritime and heavy industries like steel, cement and ammonia manufacturing,” he told the audience in attendance at the Alexkor diamond mine in Port Nolloth.

“Green H2 provides the best long-term opportunity to decarbonise hard-to-abate sectors as its use is free of emissions,” said Gungubele

The Department of Trade, Industry and Competition is developing a hydrogen commercialisation strategy and the Northern Cape and Gauteng provinces are developing provincial green hydrogen strategies focused on exports and domestic decarbonisation respectively.

“South Africa has a number of strategic advantages which could make it a globally competitive in the green H2 production area,” added Gungubele.

“These advantages include superior renewable energy endowment of both onshore wind and solar, which is the largest cost component in the production of green H2.

“We also have the largest concentration of known platinum group metal reserves, a major component in the manufacture of fuel cells,” he reminded the attendees.

He added that SA has a large local industrial base as a source of demand for this new form of energy.

“Green H2 is still an emerging sector but is one with significant potential. Global green H2 demand could reach 530 million tons by 2050, displacing roughly 10.4 billion barrels of oil equivalent [around 37% of pre-pandemic global oil production].

“The green H2 export market could be worth $300 billion per annum by 2050. Green H2’s export potential and its potential to decarbonise local industry have so far not yet been fully explored by South Africa.”

However, Gungubele also pointed out that while South Africa has a number of inherent advantages that would enable it to be a major player in the anticipated green hydrogen economy, we are behind the curve in announcing our intentions to the rest of the world relative to our competitors such as Chile, Australia, North Africa and the Middle East.

Road ahead

Sasol will be the anchor developer of the planned Boegoebaai Green H2 special economic zone.

In addition, a MoA between the Northern Cape and the Port of Rotterdam paves the way exports to Europe, with Rotterdam acting as the distribution hub for green H2 in that region.

Sasol will further develop green H2 production facilities in Gauteng, aimed at decarbonising domestic industry.

The company is already a major manufacturer of hydrogen, producing approximately 2.4 million tons per annum for the domestic market.

Aviation prospects, export opportunities

The minister noted in his presentation that Germany has created a sustainable aviation fuel market trading platform, which is intended to provide funding to green hydrogen products globally.

In fact, the German Federal Ministry of Economic Cooperation and Development has committed €12.5 million (around R217 million) funding support towards the project.

Priscillah Mabelane, executive vice president for energy at Sasol, said at the announcement of the project that it is but one step in unlocking South Africa’s potential to be a global green hydrogen and green ammonia export player, with the potential for sustainable aviation fuels in the future.

“This will also be anchored by local demand for green hydrogen,” she said.

“It is a tangible step forward for Sasol, as we seek to play a leading role in establishing the Southern Africa green hydrogen economy.

“Sasol continues to advance several catalytic projects to develop both local and export opportunities in the region. This Boegoebaai project is one of a number of green hydrogen, ammonia and power-to-X opportunities, which Sasol is assessing as part of the new strategy that the group announced [last year].

“We believe that southern Africa is well positioned to play in the global green hydrogen economy due to key structural advantages. In particular, our proprietary Fischer-Tropsch technologies and renewable endowments, are some of the best in the world,” said Mabelane.

Strategic partnerships

As the lead project integrator, Sasol will bring together strategic partners along the value chain and other enabling role players that will drive the project, and the industrialisation of the Northern Cape.

These include potential customers, funders, investors, technology suppliers and South African green energy providers.

Hydrogen is still in its infancy as far as motorists and truck drivers are concerned.

While BMW celebrated the first hydrogen refuelling station in Europe in 1997, there are currently only 14 hydrogen refilling facilities in the UK, according to UK H2 Mobility. Hydrogen Mobility Europe counts less than 45 stations.

Tesla founder Elon Musk dismisses hydrogen fuels cells as a green alternative, saying that modern batteries produces more power and are much less of a hassle.

Read:
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It could be neat solution to have a monster PV and wind plant that:
1. Generates for direct injection to the grid.
2. Makes Hydrogen with surpluses.
3. Burns hydrogen instead of gas or diesel for injection.

If the hydrogen power station makes economic sense (which seems logical it can if it is sensible to burn hydrogen rather than diesel in trucks and boats), it wold make for great peakers as well as make solar and wind dispatchable energy.

Imagine this setup compared to the turkish gas powerships mess.

Not sure why, but not easy to find references to hydrogen power plants – lots of talk but which are in operation?

First Law of Thermodynamics: There’s no such thing as a free lunch.

The closest thing is the big orange ball up there in the sky which works on nuclear fusion and would be the ultimate source of energy for earth. We’ll have to wait until about 2025 to see if it works. https://www.iter.org

Yep, making hydrogen consumes more energy than the energy the hydrogen can produce.

This logic is that the germans will pay more for the hydrogen than it costs in solar to make.

A hybrid power plant (solar/wind into grid and surplus makes hydrogen) is that the hydrogen is an efficient store of energy, So a solar plant that has 1GW capacity could contract for 24h a day maybe 400MW IPP instead of subject to sunshine. The plant could operate for a month before commncement of IPP and have stored a heck of a lot of hydrogen hours to fuel the 400MW generator.

It would be interesting case study to model. Most likely the IPP contracts for 400MW in all standard rate times at 60c and 400MW in the peak hours at 200c / kWh and not supply outside those hours when Eskom should be OK on their coal.

End of comments.

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