Sasol plans to migrate from using grey hydrogen, produced with coal and natural gas, to green hydrogen produced from renewable electricity.
As one of the biggest global leaders in the production of hydrogen energy, Sasol plans to migrate from using grey hydrogen, produced with coal and natural gas, to green hydrogen produced from renewable electricity.
Sasol currently produces more than 2.5-million tons or 3% of the 80-million tons of the global market of hydrogen and believes investing in green hydrogen will boost South Africa’s economy, Sasol vice-president of environmental sustainability Sarushen Pillay said.
“The production of hydrogen from coal and gas is responsible for half of our greenhouse gas emissions, so we see it as an opportunity to reduce our greenhouse gas emissions by replacing grey hydrogen with green hydrogen,” Pillay told the Mail and Guardian on the sidelines of an Africa energy conference in Cape Town.
“While we do that, we also see the opportunity to catalyse the growth of the hydrogen economy in South Africa. We will use hydrogen for internal use to make green products, but also supply hydrogen for mobility, for the steel industry, for other industries, and really grow the hydrogen industry in South Africa.”
He said the current cost of between $6 and $10 per kilogram of hydrogen would need to come down to at least less than $2 for it to be cost comparative.
“That is why at Sasol, we say that it is a transition from coal to gas because gas offers us an immediate opportunity to decarbonise. And then while hydrogen costs are coming down, we are not saying we are going to pause on hydrogen, we are going to push as hard as we can on green hydrogen, but we really see that opportunity to be big after 2030,” said Pillay.
The immediate plan however, is to see the renewable energy drive being accelerated and infrastructure put in place to bring the cost of electricity down.
“So wind and solar power, we really need that to grow and expand … because the main cost for producing hydrogen is renewable electricity. The first step is to switch from coal-based electricity to renewable electricity, and then the longer term as hydrogen costs come down then you look for trucks, for heavy duty vehicles, for other applications,” said Pillay.
He said the energy conference presented Africa with the opportunity to position itself as a game changer within the sector.
“We know that developed countries like Germany or in Europe are moving much faster towards net zero than us but they do not have the resources to produce fuels like green hydrogen, so they will rely on Africa, Chile, Australia, and this is an opportunity for Africa to position itself for those export opportunities,” said Pillay.
“If we do this in the right manner where we further beneficiate, build a platinum industry in South Africa, produce renewables in South Africa, we could create an equivalent amount of jobs out of the hydrogen economy to replace that we will lose in the mining sector.”
While energy leaders from the continent are saying Africa is not ready for a complete transition from fossil fuel to renewable energy, founder and chief executive at Gigawatt Global, Josef Abramowitz, told the M&G the company’s track record on bringing renewable energy to countries such as Burundi – where 10% of the country is currently receiving power from solar energy – showed that it was possible to have a just transition.
“We have been able to prove that you can do a large portion of a country’s energy with renewables. In Jerusalem, from the Red Sea to the Dead Sea, we are at over 100% solar power during the day. The first region in the world and we will be day and night by 2025,” he said.
“I think every African country can be 100% mostly solar powered during the day by 2030 and we are going to need great storage technologies which are coming up. Whether it is batteries, compressed air or hydrogen. I think hydrogen can be a cost effective way of storing solar power for night time use,” Abramowitz added.
He said he was of the view that while producing green hydrogen is currently expensive, the prices are likely to decrease as the demand for the technology gains momentum.
“The price of batteries for example, has come down by 16% to 20% a year, the price of panels has come down by 80% in the last decade. The same thing will be true for green hydrogen and here, I think Africa can be a superpower,” Abramowitz said.
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