Why did you study this topic and what are the main findings from your research?

“The paper we're talking about today is where we quantified the potential role and quantity of green hydrogen in New Zealand. And green hydrogen is always a bit of a mystery, because it can do so many things. […] It can do so many things that it has been called the ‘Swiss Army knife’. Maybe a Swiss Army knife is very handy to open a bottle of wine while camping or unscrewing that one screw when you're in a hurry. Hydrogen can, for example, decarbonize steel. It can do fertilizers, methanol. It can even do cars or trucks, trains. It can do basically anything where hydrogen is involved. And hydrogen is an element, it's the first element of that periodic table, meaning it's needed for so many things.

“So that's always my starting point to say, well, we have a huge hydrogen demand already, [like] methanol and ammonia, but we use the dirtiest sources of hydrogen, and we would like to make that a bit cleaner. We have a lot of applications of hydrogen that are possible, and some are more pushing or pressing necessary than others. So, in an attempt of sorting the applications of hydrogen, Michael Liebrech, who is an analyst, the one who founded Bloomberg New Energy Finance, proposed the green hydrogen ladder. And in that green hydrogen ladder, he sorts all the applications from ‘unavoidable’ at the top to ‘uncompetitive’ at the bottom. ‘Unavoidable’ because we don't have any other options if we want to defossilise and ‘uncompetitive’ because we do have other options.

“A classic example of ‘unavoidable’ is fertilizers, again NH3 [ammonia], so that hydrogen hopefully comes from sustainable sources. Or methanol, because we don't have any other options if we're serious about reducing our carbon footprint. And then ‘uncompetitive’ at the bottom would be, for example, cars. We have battery electric cars, which are readily available. We have the charging infrastructure, and just this year, we reach sticker price parity in the US and in China, meaning that buying an electric car is cheaper than an internal combustion car. A hydrogen fuel cell car on the other side, is very expensive. We don't have the charging infrastructure. And I think just the last couple of weeks, the news was riddled with charging stations that were closed down for personal transport, because it's pretty clear that that application isn't taking off. [However] we're still betting on a bit on hydrogen for long distance, heavy duty trucking.

“In between those extremes, in between unavoidable and uncompetitive, we have the other ranks of the ladder. And there, it really depends on the context, whether they will become competitive or not. And well, that needs careful assessment, and it's part of the job with it in this paper, but we focus on quantifying each of those applications and then kind of letting it to the audience to mature how much of that will actually happen in New Zealand.”

What are the current obstacles from NZ further adopting green hydrogen technologies?

“For each of the applications, it's always going to be, what is your competitor? Hopefully your competitor is sustainable, but not always. And that is also the big issue of the ranks that are called ‘unavoidable’. For example, fertilizer, methanol, green steel […], we don't have any other option if you want to make it carbon free. But making carbon free sometimes can be a strong assumption, in a sense of, if you want to do green fertilizer, you need to produce hydrogen to then feed the production process of the fertilizer. But the other option, often forgotten, is we can just keep on doing fertilizer, as we do now with natural gas, and for sure, that has emissions and that's bad. But we can also talk about offsets and carbon capture.

“The underlying challenge is more difficult because it is right now, do we use that amount of green electricity from solar, from wind, put it into our electrolyzer and make hydrogen to then put, for example, into the production of a fertilizer? Or do we use that same unit of green electricity to first decarbonize our heating systems, our transportation systems and all other appliances. We have big levers or drivers for growth in our electricity demand because of the decarbonization goal. So heat pumps right and keep our houses warm. And winter needs electricity. Maybe we also need a lot of cooling demand. [For example] heat pumps in summer, especially if our climate is changing. It's not far-fetched to think, for example, that Auckland will resemble more a climate like in Sydney in the upcoming years. So, the cooling demand is there.

“We want to electrify our transportation, both our personal electric vehicles, but also on the trucking to a large extent. And then we have data centers, which need a lot of energy, and there are other drivers for electrical demand, hydrogen for sure.

“I think we're facing very interesting times where for very long, we were used to having a steady demand of electricity, and all of a sudden, we have all these drivers, one on top of the other, like all happening at the same time, calling for a lot of energy. […]

“It's always a trade-off, that's what I'm trying to say. And the short answer is, sometimes the competition is the current process, like doing fertilizers with fossil gas, and sometimes the trade-off is with an emerging technology, such as the example of a fuel cell car versus a battery electric car.”