Among the many issues discussed at the Quad leaders’ meeting in Tokyo last week, the four partners stressed the importance of joint energy supply chains. The leaders notably agreed on the importance of “clean energy cooperation” in “clean hydrogen”. With a new Australian government making clear its commitment to tackling climate change, hydrogen is set to gain more attention, particularly in Australia’s relationship with Japan.
Even before the change of government, Japan and Australia had cooperated in the development of clean energy. In April this year, a consortium of Japanese companies including Kawasaki Heavy Industries, J-Power, Iwatani Corporation, Marubeni Corporation and Sumitomo Corporation, alongside Australia’s AGL Energy, held a ceremony celebrating the success of a pilot project to transport hydrogen from Australia to Japan by the world’s first liquefied hydrogen tanker, Swiss border. Japanese Prime Minister Fumio Kishida said at the time that hydrogen was key to Japan’s energy security and progress toward carbon neutrality goals, especially given energy concerns stemming from the Russian invasion of the ‘Ukraine.
Hydrogen is increasingly attracting attention as a potential means of an energy revolution. Gas itself colorless, there are different colors in the classification of hydrogen according to its modes of generation: carbon-free renewable energies (green), fossil energy associated with the carbon-neutral process of carbon capture and storage (blue), method steam methane reforming (grey), coal or lignite (black or brown), thermal separation of methane (turquoise), nuclear (pink, purple or red) and natural production (white).
Meeting the technical challenges of transporting liquefied hydrogen is one thing.
Japan had announced its “basic hydrogen strategy” in 2017, aiming to become a “global hydrogen-based society”. The strategy outlined that Japan would develop core technologies with Australia to demonstrate a “liquefied hydrogen supply chain” paving the way to commercialization. Shipping liquefied hydrogen was key to this goal. Based on this strategy, Swiss border was developed in Japan to be a liquefied hydrogen carrier vessel under an A$500 million pilot project supported by the Japanese and Australian governments. The ship left the port of Kobe in Japan on December 24, 2021, arriving at Hastings Port in Victoria, Australia about a month later, before returning safely to Kobe on February 25, 2022.
Prior to this success, Tokyo and Canberra had entered into several agreements and declarations regarding bilateral renewable energy cooperation. In June 2021, Japan and Australia agreed to cooperate to facilitate their carbon neutrality goals under the Paris Agreement by announcing a “Japan-Australia Partnership on Decarbonization through Technology”. The aim was to build on previous initiatives, such as the ‘Hydrogen Energy Supply Chain’ (HESC), the ‘Japan-Australia Energy and Resources Dialogue’ (JAERD) and the Joint Australia-Japan Hydrogen and Fuels Cooperation”. Cells”.
In January this year, the ‘Australia-Japan Clean Hydrogen Business Partnership’ was released, with then-Prime Minister Scott Morrison stating that ‘clean hydrogen is at the heart of Australia’s plans and Japan to achieve net zero emissions while growing our economies and jobs.” The Australian government has so far reportedly invested more than A$1.3 billion in developing the nation’s hydrogen energy industry, with liquefied hydrogen created from lignite and biomass produced in a hydrogen production plant at AGL Energy’s Loy Yang site in the Latrobe Valley. in Victoria.
The fossil fuel component of the product has led critics to point out that “emissions from lignite-derived hydrogen are twice those from natural gas.” A group of energy experts in Australia have warned that carbon capture and storage (CCS) technology is “technically complex and expensive” and that high carbon capture rates are not assured, meaning the Hydrogen liquefied by such processes cannot be “truly clean” hydrogen. Other experts have argued that Japan’s carbon recycling strategy is a “risky gamble”, pointing out that Japan’s energy strategy includes building more coal-fired power plants.
Meeting the technical challenges of transporting liquefied hydrogen is one thing. Buying hydrogen in Australia might not be the cheapest choice either. But from Tokyo’s perspective, Australia is a strategically reliable trading partner for Japan.
Notably, Japanese companies have also sought to cooperate with Australian companies for the commercialization of “green hydrogen” energy. In January, Japan’s Sojitz Corporation announced it would work with Australian power producer CS Energy on a demonstration project to transport green hydrogen produced from solar power in Queensland to Palau in purposes of backup power sources in small fuel cells. The Pacific island country aims to achieve 45% renewable energy production, and the project is financially supported by the Japanese Ministry of the Environment. Similarly, Osaka Gas announced in April that it would provide project management as well as engineering and technical support for a AUD$10.75 billion “green hydrogen project” in Australia.
While the war in Ukraine has served to underscore Japan’s concerns over energy security, it provides an impetus to expand fuel sources. A “quasi-alliance” between Japan and Australia in energy security cooperation, especially clean hydrogen energy, has significant economic potential. The opportunity to develop a hydrogen supply chain network in the Indo-Pacific should be a priority.