South Africa should pursue pilot projects to enable the green hydrogen economy to scale up, according to Ebrahim Takolia, founder and CEO of project integrator and technology provider Green Hydrogen Solutions.
“As more renewable energy is brought online by Eskom and distributed energy sources, significant excess renewable energy can be used in conjunction with dedicated renewable energy sources to produce hydrogen and its derivatives while also providing long-term storage, thereby improving the business case for renewable energy.”
Thus, South Africa should explore facilitating market efficiency in the trading of renewable electricity and enabling the trading of hydrogen for domestic and international consumption.
Green Hydrogen Solutions’ techno-economic modeling of its local projects reveals that by utilizing its technology and approach, it is possible to obtain a lower-than-average hydrogen price for a pilot plant when compared to similar pilot projects.
Takolia adds that scaled-up models indicate that the company can create hydrogen for between $2 and $3 per kilogram using existing technology, which is comparable to a natural gas price of R211 to R347 per kilogram.
“Once carbon taxes and projected carbon border taxes are included in, as well as the geopolitical uncertainty risk that will be priced into global markets for oil, gas, and liquefied natural gas in the future,” Takolia notes, “green hydrogen will be a more cost-effective alternative in the long run.”
Meanwhile, he notes that technology may contribute significantly to the local hydrogen economy by shortening the time required to create projects and cutting their costs through improved electrical supply, lower electricity and capital expenses, and end-use integration.
“Approximately 70% of the lifetime cost of green hydrogen is related to procuring the cheapest electricity for the longest period of time. Smart grid technology and time-of-use pricing will enable electricity to be acquired from both project-owned and excess generation, decreasing the average cost of electricity.”
Takolia continues by stating that capital expenditure accounts for roughly 20% of lifetime expenditures, followed by finance, operations, and maintenance costs in equal measure.
“It is critical to the project’s viability that the electrolyser and balance-of-plant system are optimized for the end-use scenario and project requirements.”
Green Hydrogen Solutions is committed to innovation and the practical use of technology.
Takolia’s technology is worldwide in scope, and the business is currently evaluating pilot projects in South Africa and in conversations with possible project partners.
The company has been beta testing its application (app) – Green Hydrogen App Ecosystem – with the goal of facilitating the integration of variable renewable energy sources into a green hydrogen ecosystem.
High energy prices and geopolitical instability underscore the importance of increasing energy supply and risk efficiency.
As a result, Takolia believes it is critical to develop more effective methods of transporting and trading energy, which includes bringing distributed energy closer to customers in order to avoid disruptions.
“We encourage project developers to use our app, under development, which can be used to trade and transact in a green hydrogen ecosystem. “This will ensure an efficient pricing mechanism that incorporates carbon markets to subsidise the cost of green hydrogen,” he says.
The company’s app can be downloaded from Google Play and the App Store and enables project developers to load their electricity, hydrogen or end-use product onto the app, which will, consequently, enable Green Hydrogen Solutions to engage in legal assessments to establish the mechanisms to allow for global trading and transacting processes.
According to him, a globally connected green hydrogen trading and transaction platform will increase market efficiency, transparency, and price certainty, hence facilitating the development of green hydrogen.
Current ambiguity surrounding local energy supply will see future energy supply dominated by distributed, small-scale renewable and low-carbon systems integrated with end-use markets.
“If green hydrogen replaces merely 20% of oil and gas by 2050, more than 2.5 million projects will be required.”
Research and development (R&D) funding for the green hydrogen industry has expanded and aims to reduce electrolysis, renewable electricity, storage and dispensing costs through technology selection, system integration and optimisation.
Technologies have been introduced for electricity to allow for better integration of smart grids and time-of-day forecasting which lowers hydrogen production costs through the supply of cheap electricity for a long period.
Further, R&D is underway on the production of hydrogen in South Africa, and globally, to increase efficiency to improve hydrogen production rates and lower the costs of electrolyser components.
Meanwhile, Green Hydrogen Solutions and its project partners were awarded a maritime innovation award by government agency UK Innovation in September last year to assess the feasibility of a green hydrogen platform for marine use applications in Poole Harbour, in the UK.
This idea was also recognized for its originality during last November’s United Nations Climate Conference. The feasibility study will be completed this month and the company is assessing various locations to deploy this solution on a commercial scale globally.
The project scales from about 1.4 MW to 2 MW.
“Apart from our own pilot projects, we are collaborating on green hydrogen and other innovation projects, notably combining green hydrogen with carbon capture, on five continents. Many of these projects will reach commercial operation from 2025 onwards,” concludes Takolia.
