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Inside the Global Race to Turn Water Into Fuel
By Max
Bearak
Photographs by Giacomo
d’Orlando
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The Christmas Creek iron ore mine in Western Australia. Green
hydrogen producers
hope to find customers in the country’s huge mining industry, which
currently relies on fossil fuels.
Hundreds of billions of dollars are being invested in a high-tech gamble
to make hydrogen clean, cheap and widely available. In Australia’s
Outback, that starts with 10 million new solar panels.
For eons this has been a quiet, unremarkable place. Thousands of square
miles of flat land covered in shrubs and red dirt. The sun is withering
and the wind blows hard.
It is exactly those features that qualify this remote parcel of the
Australian Outback for an imminent transformation. A consortium of energy
companies led by BP plans to cover an expanse of land eight times as large
as New York City with as many as 1,743 wind turbines, each nearly as tall
as the Empire State Building, along with 10 million or so solar panels and
more than a thousand miles of access roads to connect them all.
But none of the 26 gigawatts of energy the site expects to produce,
equivalent to a third of what Australia’s grid currently requires, will go
toward public use. Instead, it will be used to manufacture a novel kind of
industrial fuel: green hydrogen.
This patch of desert, more than 100 miles from the nearest town,
sits next to the biggest problem that green hydrogen could help solve:
vast iron ore mines that are full of machines powered by immense amounts
of dirty fossil fuels. Three of the world’s four biggest ore miners
operate dozens of mines here.
Proponents hope green hydrogen will clean up not only mining but
other industries by replacing fossil fuel use in steel making, shipping,
cement and elsewhere.
Green hydrogen is made by using renewable electricity to split
water’s molecules. (Currently most hydrogen is made by using natural gas,
a fossil fuel.) The hydrogen is then burned to power vehicles or do other
work. Because burning hydrogen emits only water vapor, green hydrogen
avoids carbon dioxide emissions from beginning to end.
In the Pilbara region of Western Australia, and in dozens of spots around
the globe endowed with abundant wind and sun, investors see an opportunity
to generate renewable electricity so cheaply that using it to make green
hydrogen becomes economical. Even if only some of the projects come to
fruition, vast stretches of land would be duly transformed.
![](images/images_03_13_2023/pic10.jpg)
Note: Dots on cargo routes represent accumulated ship locations
Sources: BP, MariTrace, Australian Government
By Mira Rojanasakul/The New York Times
The project is one example of a global gamble, worth hundreds of billions
of dollars, being made by investors including some of the most polluting
industries in the world.
Last year, government subsidies sped up action in the European
Union, India, Australia, the United States and elsewhere. The Inflation
Reduction Act, the Biden administration’s landmark climate legislation,
aims to drive the domestic cost of green hydrogen down to a quarter of
what it is now in less than a decade through tax incentives and $9.5
billion in grants.
“We are about to jump from the starting blocks,” said Anja-Isabel
Dotzenrath, who once led Germany’s biggest renewable energy company and
now runs BP’s gas and low-carbon operations. “I think hydrogen will grow
even faster than wind and solar have.”
Not everyone sees it that way. Challenges loom on every level, from
molecular to geopolitical.
Some energy experts say green hydrogen’s business rationale is
mostly hype. Doubters accuse its champions of self-interest or even
self-delusion. Others see hydrogen as diverting crucial investment away
from surer emissions-reduction technologies, presenting a threat to
climate action.
Still, if the rosiest projections hold, green hydrogen in heavy
industry could reduce global carbon emissions by 5 percent, if not two or
three times that. In those scenarios, which are far from certain, hydrogen
plays a crucial role in limiting global warming.
Fatih Birol, the Turkish economist who leads the International
Energy Agency, said he seldom meets people who don’t find green hydrogen
alluring, with its elegant elementality. His organization forecasts that
green hydrogen will fulfill 10 percent of global energy needs by 2050.
He said the agency’s expectations were based on the fact that, if
the world wants to limit warming to 1.5 degrees, “so much green hydrogen
needs to be part of the game.”
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A ‘Monstrous Challenge’
For green hydrogen to have a substantial climate impact, its most
essential use will be in steel making, a sprawling industry that produces
nearly a tenth of global carbon dioxide emissions, more than all the
world’s cars.
In climate lingo, steel emissions are “hard to abate.” Blast
furnaces, freight trains, cargo ships and the gargantuan trucks used in
mining require heavy fuels like coal and oil. Even if they could be
electrified (and, as a practical matter, today many can’t be) they would
strain grids enormously.
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Day and night, two-mile-long ore trains,
weighing more than 90 million pounds, depart Christmas Creek for
Port Hedland. From the port, an endless stream of cargo ships (once
again, burning heavy fuel) sail for East Asia, where ore becomes
steel in coal-burning mills.
Nearly 40 percent of the world’s iron ore comes from the Pilbara.
Wherever you are, when you look out at the world, some of what you
see is likely born of materials mined in and around Christmas Creek.
It wouldn’t be an overstatement to call the mine’s owner, Andrew
Forrest, the most bullish of hydrogen’s backers. When he said two
years ago that he was going to rapidly switch the mining operations
of his company, Fortescue Metals Group, to running fully on electric
batteries, green hydrogen and green ammonia, a fuel derived from
hydrogen, he was “met with mirth,” he said recently.
“Back then there was a distinct, visible horizon of disbelief that
the world could actually change,” said Mr. Forrest, who is also one
of the richest people in the world. He’s adamant that there’s a
market, even if others see folly.
Both Fortescue and BP envision themselves as
vying for the lead in green hydrogen and have announced plans to
invest hundreds of billions of dollars in projects across dozens of
countries beyond Australia, from Oman to Mauritania to Brazil and
the United States. Those would still account for only a smidgen of
the hundreds of millions of tons the I.E.A. and others say would be
needed to create a market in which green hydrogen was cheap enough
that steel and concrete makers were convinced to convert their
operations.
Even though both companies are hugely profitable, Australia’s
government has made hundreds of millions of dollars available to
them through subsidies and land allocations over the past two years,
mostly in Western Australia, which is six times the size of
California but has only 2 million people.
“Diesel has had 120 years to become plentiful and affordable,” said
Jim Herring, who oversees Fortescue’s green industry development.
“We want to scale hydrogen up in a tenth of that time. It’s a
monstrous challenge, honestly.”
The ‘Absolute Zero’ Problem
![](images/images_03_13_2023/pic18.jpg)
Iron ore on the way to Port Hedland.
To liquefy hydrogen for shipping, it must be
chilled to negative 252.87 degrees Celsius, just shy of absolute
zero, the theoretical temperature at which atoms are completely
still. Hydrogen is also very flammable, making storage difficult.
They’re just two of many obstacles.
Some doubts come from hydrogen’s advocates themselves. “The
economics of shipping aren’t looking good,” said Alan Finkel, the
architect of Australia’s hydrogen subsidies. “I was naïve, I think,
in the past to see export being the main demand driver,” he said in
a recent interview. Instead, “There’s a lot of sense in ‘use it
where you make it,’ and Australia is really ideally set up for
that,” he said.
Some are even more skeptical.
Saul Griffith, a prominent inventor in renewable energy who started
his career at an Australian steel mill, doesn’t see a big role for
green hydrogen. To replace fossil fuels, he said, “the electricity
you use to make it would have to be ridiculously cheap. And if you
have that, why use it to make hydrogen?”
He calls it “not a fuel that will save the world.” Better to spend
the money, he and others argue, on reducing renewable electricity
costs so that nearly everything can be electrified.
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Mr. Forrest says skeptics simply lack
scientific knowledge. Fortescue, he said, will mix hydrogen with
carbon dioxide so it is similar enough in consistency to liquefied
natural gas that it can be transported in the same tankers.
“It’s is as simple as it sounds,” he said.
Mr. Forrest said he believed that, by decade’s end, he would save
his shareholders at least $1 billion a year by converting mining
operations to green hydrogen, and that his company would ultimately
produce hydrogen at dozens of sites worldwide. BP says it will be
exporting large quantities of green hydrogen and ammonia by then,
too.
The interest taken in hydrogen by oil and gas companies concerns
some climate activists. While BP, for instance, has presented green
hydrogen as part of its pivot toward cleaner energy, the company
this year scaled back plans to phase down oil and gas production
over the coming decades amid record industrywide profits.
Energy companies already produce most of the world’s hydrogen fuel,
but make it from natural gas, which is, of course, a fossil fuel.
Some, including BP, stand to receive federal subsidies in the United
States because the company plans to capture the carbon and store it
rather than release it.
This is called “blue hydrogen,” and some critics consider it a
loophole in the Biden legislation that incentivizes fossil fuel
production.
Ms. Dotzenrath said opposing blue hydrogen amounted to letting the
perfect be the enemy of the good. “That’s absolutely nonsense,” she
said. “It’s ultimately all about the carbon intensity.”
But in Australia, at least, BP’s green hydrogen investments are
pushing ahead.
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One of the impediments to huge green hydrogen
projects is the short supply of electrolyzers, the machines that use
electricity to split water molecules apart, isolating the hydrogen.
One issue is that China, which produces most of the world’s solar
panels, wind turbines and renewable energy tech, hasn’t embraced
electrolyzer production. Analysts said there was a shrewd calculus
to that: China is heavily invested in coal, and much of that is tied
to steel and cement production.
“It’s still a question: Will China go all in on hydrogen?” said
Marina Domingues, a clean technology analyst at Rystad Energy.
Despite the challenges, dozens of countries are betting on green
hydrogen. Last year, Spain, Portugal and France agreed to build an
undersea hydrogen pipeline by 2030 that would eventually supply the
rest of Europe. Japan, Taiwan and Singapore, which import nearly all
their energy, have also said hydrogen will be key to becoming carbon
neutral economies.
And Fortescue, for its part, is going into the business of making
electrolyzers. This month in Australia it is opening its first
factory, the world’s biggest.
The ‘Champagne’ of Energy
![](images/images_03_13_2023/pic26.jpg)
A solar farm that generates electricity for the Christmas Creek
mine.
For
Fortescue, the math is simple. Every year, each of its mines in the
Pilbara expands outward at least a couple miles. While the company
is developing 15-ton batteries to replace the diesel engines on some
of its ore haulers, the mine at Christmas Creek, for instance, is
already too sprawling for total reliance on batteries: New,
battery-powered haulers just won’t have the range for the mines’
farthest reaches.
Fortescue expects 70 percent of its fleet to be running on batteries
a decade from now — some powered by a mobile, 40-ton charger mounted
on a vehicle resembling a military tank. But the rest would run on
hydrogen or ammonia, replacing the billion-odd liters of diesel
Fortescue uses annually.
BP is taking a more measured approach. Many of its global projects
aim to produce blue hydrogen, which is cheaper, for now. Its green
hydrogen projects in Australia, including the repurposed refinery
near Perth, will come online in stages over a decade or longer.
Nevertheless BP, too, sees an inevitable shift toward green hydrogen
driven by increasingly stringent regulations in the United States,
European Union, Japan and South Korea.
In an “accelerated scenario” that envisions more ambitious
emissions-reduction targets set by the nations of the world, BP
predicts that, by 2050, green and blue hydrogen will be the
predominant fuels in steel production in those countries and will
also account for between 10 and 30 percent of fuel in aviation and
between 30 and 55 percent in shipping.
“Hydrogen,” Ms. Dotzenrath said, “is the champagne of the energy
transition.”
Green Play Ammonia™, Yielder® NFuel Energy.
Spokane, Washington. 99212
www.exactrix.com
509 995 1879 cell, Pacific.
Nathan1@greenplayammonia.com
exactrix@exactrix.com
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