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Interview with Paul Culliver, ABC Radio Capricornia

21 April 2021

Paul Culliver

Subject: Funding for hydrogen projects


PAUL CULLIVER: This morning we've learned that the Federal Government is committing something like $500 million to develop, well, half of it roughly goes to developing four more hydrogen production hubs in regional areas and half of it goes towards carbon capture and storage, and a lot of that will flow to Gladstone. Let's find out just how much. The Federal Minister for Energy and Emissions Reduction is Angus Taylor and he joins me on the line this morning. Good morning to you Minister.

ANGUS TAYLOR: G'day Paul, thanks for having me.

PAUL CULLIVER: How does this money change what happens in Gladstone?

ANGUS TAYLOR: Well, it is intended to cement places like Gladstone as energy hubs. I mean, Gladstone is one of the great energy hubs of the world. Energy is changing. Energy has always been changing, energy systems and the industrial application and manufacturing on the back of that. And hydrogen is one of the great opportunities for Australia. This is a commitment now to extend the single hydrogen hub we committed to a little while back, to in fact create five because we realise there's such a big opportunity here. Obviously Gladstone is a prime candidate for that because of its starting point as an energy hub. It's got the skills, it's got the gas experience. It's obviously a big supplier into manufacturing right now. It's a big exporter. So it's extremely well positioned. And our goal here is to build this hydrogen industry in places like Gladstone as quickly as possible on the back of customers, not just in Australia - obviously, there will be hydrogen customers in Australia - but offshore customers like in Asia and Japan where there's enormous interest right now. And that's all about creating jobs - 8,000 jobs we know from the hydrogen industry from the work we did with Alan Finkel. And an enormous opportunity for Australia and Regional Queensland.

PAUL CULLIVER: Alright, anything in the energy space has always got to be about solving the trilemma. That's cost, emissions, reliability. What does hydrogen and carbon capture and storage do to fix any of those problems?

ANGUS TAYLOR: It helps to fix all of them, indeed, because it allows us to get that affordable low emissions energy into our energy systems. Hydrogen can be produced from a number of sources. It can be produced from gas. We do it now. It can be produced from electrolysis, using water, and that's growing fast, but from a small starting point. But it allows us to bring down emissions in our energy systems, but as we bring the cost of production of hydrogen down to do it in a way which is affordable and reliable. One of the great things about hydrogen is it's a storable fuel source and it's a transportable fuel source, either as hydrogen or as ammonia. And that is different from solar and wind. Solar and wind can feed in to produce hydrogen of course, but they're not storable and they're expensive to transport. So, by converting it to hydrogen we can export it to countries like Japan, like Korea, like China, our customers up in Asia and across Australia of course.

PAUL CULLIVER: Will you require all the hydrogen made in these hubs to be made using renewable energy?

ANGUS TAYLOR: No. A mix is the answer. Balance is always the answer in energy systems. Renewables and green hydrogen, as it's called, which is made from electrolysis, is a very, very important fast growing area. Costs are coming down but it's still substantially more expensive than producing hydrogen from gas which we do now for making fertiliser. In fact, the food you eat on your plate for breakfast this morning will have been made almost certainly from nitrogen fertilisers which are made from gas, from hydrogen produced from gas, and that will continue to play a role. But the thing we can do with the CO2 coming from that gas is sequester it, and that's why we're investing a very significant sum, a total over all these projects of over $500 million. But around half of that in carbon capture and storage hubs, just like we're focusing on hydrogen hubs.

PAUL CULLIVER: Okay. Can you talk to me, what is the carbon capture and storage? What exactly are the technologies you're wanting to implement here?

ANGUS TAYLOR: Well, there's a range of technologies. They range from using existing oil and gas reservoirs and pumping the CO2 in there and storing that. We've actually been doing this for a long while. What we haven't been focusing on is how best to store it there, and that's where the technology has been advancing. And that's one side of it. The other side of it is actually taking CO2 and putting it into materials and storing it in materials. So indeed, you can take CO2 and you can put it into, say, road base and store the CO2 there. So, there's a range of different projects in this area. There's an enormous amount of innovation going on in the United States and in Australia in these areas. We're leading the world in many of them and the technology is advancing fast and the costs are coming down fast, which is the key, because energy systems have to be affordable. And this is absolutely essential.

PAUL CULLIVER: And is there any intention with this money to retrofit coal-fired power stations with carbon capture?

ANGUS TAYLOR: Well, it's not so much a matter of retrofitting. What we are doing in the Latrobe Valley right now is producing hydrogen from coal, from brown coal down there, and then sequestering the carbon from that production of hydrogen. That's where we see the immediate opportunity with coal, which is happening. It's a big project, a $500 million project with Japan, with the Victorian State Government. There's potential to do this elsewhere assuming it's successful. This is one of the areas where we see great potential for, alongside Gladstone, for a hydrogen and carbon capture and storage hub down in the Latrobe Valley in Victoria. There's a range of others. But you know, what we're seeing is a real burgeoning of technologies that allow us to deliver this affordable, reliable energy across Australia and indeed across the world in a way that brings down our emissions. And let's face it, this problem of bringing down emissions is a global problem. It's not just Australia. And the role we play as an energy provider to countries like Japan and Korea and others throughout Asia is enormously important in helping them to bring down their emissions, but at the same time then preserving our jobs and strengthening our jobs and industries in the energy sectors that have been so important to places like Gladstone. 

PAUL CULLIVER: Well, just on that, obviously in the next two days the Prime Minister Scott Morrison is going to be part of US President Joe Biden's virtual greenhouse gas emissions summit. The timing of this announcement, is this so that Scott Morrison can show that he did his homework?

ANGUS TAYLOR: Well, we've been working on these projects, and indeed we announced our first hydrogen hub sometime back. So, we continue always to drive these sensible, practical policies that are about innovating to bring down emissions, not eliminating. There has been an obsession with eliminating industries and eliminating jobs and eliminating regions- 

PAUL CULLIVER: My question went to the timing, whether it was a coincidence or not?

ANGUS TAYLOR: My point is that we're making announcements like this all the time and we've been focusing on technology not taxes certainly since I've been in this role as Minister for Energy and Emissions Reduction, and we'll continue to. And you know, we announced the Technology Investment Roadmap last year, which was all about focusing on using technologies to bring down emissions and create jobs at the same time. Strengthen our regional areas, strengthen our regional industries, strengthen our relationships with our big energy customers. So, this is the focus and it has been for some time. It will continue to be. We'll continue to make investments like these ones. This is a huge vote of confidence in our regional energy hubs like Gladstone. Over $500 million. And we'll continue to have that strong focus, that strong confidence, and that real clarity about how we're going about bringing down emissions and strengthening our energy systems.

PAUL CULLIVER: Alright, Minister, thanks for your time today.

ANGUS TAYLOR: Good on you, Paul.