Victoria’s Latrobe Valley coal-to-hydrogen pilot project gets green light from EPA
A world-first pilot project which will turn brown coal from Victoria’s Latrobe Valley into hydrogen has been approved by the Environmental Protection Authority (EPA).
The Hydrogen Energy Supply Chain project, spearheaded by a Japanese-led consortium, will test the feasibility of producing hydrogen from brown coal and shipping it to Japan for use in the domestic market.
The one-year project, led by Kawasaki Heavy Industries, will begin in mid-2020, with production to be handled at a plant adjacent to the Loy Yang power station.
It will use 160 tonnes of brown coal from Loy Yang’s mine to create three tonnes of hydrogen which will be shipped to Japan at a loading terminal in the Port of Hastings via a specially-designed boat.
Announced in April 2018, then-prime minister Malcolm Turnbull attended the launch of the project, which received $50 million each from the Victorian and Federal governments.
Mr Turnbull said last year that the project could provide jobs into the future, but the consortium could only proceed the commercial stage if it was able capture and store its greenhouse gas emissions.
The consortium expects the project to generate 100 tonnes of carbon emissions during the pilot phase, which it says is equivalent to the output from 20 cars.
The EPA’s director of development assessments, Tim Faragher, said the proposal was about demonstrating that the process could work, and gathering information which could lead to a commercial project.
“We’re very comfortable that the emissions and the waste products that will come out of this proposal can all be safely managed and are all acceptable to our protective standards,” Mr Faragher said.
Environmental groups, however, have slammed the proposal.
Cam Walker from Friends of the Earth said the EPA decision was not transparent and the Victorian government should not be investing $50 million in coal projects.
“We are disappointed a progressive government and a government that ‘gets’ climate change is pushing this sort of technology,” Mr Walker said.
“There’s a whole range of environmental, public heath and water impacts that would be attached to any scaling up of this industry.”
He added that the greenlight could also go against the Victorian government’s own coal policy.
But Mr Walker’s bigger concern was if the pilot project turns into a commercial-scale operation, as this would rely on carbon capture storage technology to be carbon neutral, and this was unproven.
“If it is approved and if it is commercialised, then there will be very significant impacts on groundwater, on air quality, on public health and on greenhouse gas emissions,” he said.
Under the proposed full-scale project, the hydrogen would be shipped to Japan from the Port of Hastings in South Gippsland.
French Island resident Chris Chandler, who is part of the Save Westernport Action Group, said that if the project were to be expanded for the trial stage, it would require large scale dredging at the ecologically fragile site.
“That dredging would probably lead to the death of sea grass and huge die off of the ecology at Western Port,” he said.
“It seems ridiculous for the government to spend 100 million dollars on producing clean energy for Japan when we have to deal with the pollution.”
Industry group Hydrogen Mobility Australia hopes the EPA’s approval of the project could help build an industry worth $1.7 billion to Australia from 2030.
Group chief executive Claire Johnson said Australia could become a large-scale exporter of hydrogen to Asian countries such as Japan, China and South Korea.
“Countries such as Japan have made public commitments that they’re transitioning to what they call a hydrogen society,” Ms Johnson said.
“They’re doing this for a couple of reasons — one is to decarbonise their economy, they need to meet their Paris climate agreements.
“The other reason is due to incidents such as the Fukushima nuclear disaster, where the instability of nuclear has been recognised as an ongoing issue, and that they wish to transition to more reliable, sustainable energy sources.”
The Australian hydrogen industry received a boost last month when Opposition Leader Bill Shorten announced a Labor government would spend $1.14 billion on a national hydrogen plan in a bid to become a world leader in the sector.
“We’re in a really good position where we have bipartisan support, and that means no what matter what government is elected, come the federal election a hydrogen strategy will be realised,” Ms Johnson said.
“We believe this will set a very good foundation for scaling up the sector given the investment it needs.”
Council sees jobs potential
Latrobe City Councillor Graeme Middlemiss pictured near the Morwell power station. (ABC Gippsland: Robert French)
The Latrobe City Council has described the project as “one of the possible futures” for the local economy after recent job losses in the region.
In 2017, the Latrobe Valley lost 750 jobs when the Hazelwood power station closed, which was followed by the loss of 160 jobs when the Carter Holt Harvey sawmill closed.
Mayor Graeme Middlemiss has welcomed the project and believes coal still has a future in the region.
“But let’s make it very clear, we’re not talking about the current state of the 1970s or ’60s designed plants which are putting out a fairly high proportion of greenhouse gasses,” Cr Middlemiss said.
“I’m talking about high-tech, low emissions future uses of brown coal and they probably won’t be used for electricity generation.”