November 2, 2023

The future of hydrogen-powered shipping according to an industry expert

Is hydrogen-powered shipping the future of road freight in Australia? We spoke to a green energy leader to get his expert opinion.

The future of hydrogen-powered shipping according to an industry expert

As the global community works to combat climate change, the need to find more sustainable solutions is driving innovation in several areas—including the freight industry. 

We are now seeing hydrogen-powered road freight as a viable, sustainable solution that is shaping the logistics landscape here in Australia. As carriers and shippers both grapple with the pressing need for eco-friendly alternatives to traditional methods, Ofload is committed to championing green technologies in the freight industry. Hydrogen fuel cells and other environmentally-conscious technologies shouldn’t just remain hypothetical concepts, but should become integral parts of Australia’s logistics solutions. 

Hydrogen for transport and shipping in Australia

The Australian government has made a push towards hydrogen energy with strategic investments and commitments, demonstrating that it sees hydrogen as a fuel of the future and a way to limit greenhouse gas emissions. As Chris Bowen, the Minister for Climate Change and Energy, asserts, “Green hydrogen sits at the core of our vision for a self-reliant, prosperous Australia in a net-zero future”. 

Mr Bowen’s comments are backed up by both public funding and private investment in this integral area:

  • Public Funding: $2 billion has been channelled by the Australian government into the Hydrogen Headstart Program. Additionally, the NSW government has dedicated $64 million to the establishment of two pivotal hydrogen hubs. On top of this, $1.5 billion has been granted in electricity concessions for large-scale green hydrogen producers, to reduce the cost of supply.
  • Private Investment: Surpassing public efforts, the private sector in Australia has announced a massive $250 billion of green hydrogen projects as of 2022.

Hydrogen-powered road freight around the world

Australia is not alone in recognising the transformative power of hydrogen, hydrogen fuel cells and battery electric vehicles (BEVs) for sustainable transport. According to the 2022 Australian State of Hydrogen report, from all the different sectors assessing the viability of hydrogen—from aviation to steel—heavy-duty vehicles stand out. Every nation moving away from combustion engines and substantially investing in hydrogen has prioritised freight transport. This global alignment underscores the importance of leading the way in the hydrogen-powered transport domain, placing carriers at the forefront of an innovative and sustainable future. 

The importance of zero-emission hydrogen production

Still, the whole point of hydrogen-powered transport would be missed if the electricity used to produce this hydrogen was made through burning fossil fuels. This is why the Australian government introduced the Guarantee of Origin scheme. This strategic move ensures the verification of emissions associated with hydrogen production, providing renewable electricity certifications. This system allows for a quick and easy check of the hydrogen’s origin and can simplify the implementation and use of green hydrogen on a national scale.

Pioneering hydrogen-powered shipping: The Hume Hydrogen Highway

Linking Melbourne and Sydney, the Hume Hydrogen Highway is a joint project between NSW and Victoria, both states investing $10 million each into this project. With a combined investment amount of $20 million, the project aims to establish four state-of-the-art refuelling stations and deploy 25 hydrogen-powered long-haul freight vehicles by 2026. In the 2022 Budget, the Federal Government announced a further $89.5m commitment to match state government funding commitments for Hydrogen Highways nationwide. However, forward-thinking companies are already gearing up, not waiting for official government projects to bring hydrogen-powered vehicles to the roads.

The future of hydrogen-powered vehicles

July 2023 marked a significant milestone in Australia: the launch of Australia's first hydrogen prime mover truck. The most exciting part? Leading freight carriers are already committing to harnessing the power of hydrogen in Australia. In addition to this, the country is witnessing a surge in hydrogen production facilities and refuelling stations, as charted in real-time by the CSIRO Hydrogen Map.  July 2023 also welcomed the first heavy vehicle hydrogen refuelling station opening in Port Kembla.

Ofload's commitment to the future

Ofload stands firm as a digital freight forwarder, dedicated to spearheading the transformation of the logistics industry in Australia. Through strategic collaborations with shippers and carriers, we are set to leverage hydrogen-powered vehicles, ensuring an efficient, sustainable, and innovative freight transport landscape. Sign up today and become a shipper or carrier with Ofload and join us on this exciting hydrogen-powered journey. The Ofload platform is easy to use, and free for carriers to sign up to. 

What the experts have to say about hydrogen-powered shipping

We recently had the opportunity to speak with David Heard, the Executive Director, Australia, of Hiringa Energy. Hiringa is an NZ-based energy company and one of the main hydrogen infrastructure providers. They have a simple mission: to produce zero-emission green hydrogen and develop the infrastructure necessary to deliver it. The company states that addressing climate change is its key motivator, and it aims to decarbonise sectors like heavy transport and industrial processes.

Tell us who Hiringa is and what their vision is for the Australian trucking industry.

David Heard: We are a New Zealand-based hydrogen company. Basically, our founders came together after a long history in the oil and gas industry, and they saw an opportunity to transition away from fossil fuels in 2017. They were able to obtain NZ government support and we are now commissioning one of the world’s first high-capacity hydrogen refuelling networks for heavy trucks. 

How exactly does hydrogen fuel a truck?

David Heard: There are two main ways. The simplest way is burning the hydrogen directly like a traditional fuel, but it is not the most efficient. However, a ‘dual-fuel’ combination of hydrogen and diesel gives carriers a greater range than diesel alone and still offers an emission reduction. It is also reasonably cheap to retro-fit vehicles, and can make sense for reducing emissions per km from existing trucks. 

In the long term, the better solution is to have entirely hydrogen-powered electric vehicles with a fuel cell that converts hydrogen to electricity. Instead of having a large, heavy battery that takes a long time to recharge, you carry energy as hydrogen. This approach gives you a much better driving range per kilogram, and is a good choice for new vehicles entering a fleet. 

What is the current state of progress of your hydrogen facilities in NSW?

David Heard: We want to apply what we’ve already accomplished in New Zealand in Australia. One way we want to revolutionise heavy road transport is by making cheap hydrogen supply for trucking, by partnering with the agriculture sector on a larger-scale project. 

We are building a new 27MW solar PV asset on our JV partner’s property in Moree, NSW.  This will supply the electricity to make low-carbon hydrogen at scale, and convert much of that hydrogen to ammonia to use as fertiliser on the property. There is additional production capacity for hydrogen that can ultimately be used for transport. What you have here is efficient-cost hydrogen supply for mobility, because it is supported by the large-scale hydrogen demand as a chemical feedstock to make fertiliser.

How can you guarantee that your hydrogen is green?

David Heard: Australia is in the process of developing a Guarantee of Origin scheme for electricity, hydrogen and other products, which means that all our hydrogen must be accredited according to this system with a measure of the carbon intensity of its manufacture. To be classed as ‘green’ in NSW this means that evidence has to be provided on an annual basis that shows every MWh of electricity used to make the hydrogen is accredited as coming from a renewable source.

How many hydrogen trucks could Hiringa’s facility power? 

David Heard: We have a couple of large-scale sites in mind initially, which will have the capability to refuel 50-60 hydrogen trucks per site each day.

Do you feel that the NSW and Australian governments respectively are giving sufficient support to hydrogen-related projects? 

David Heard: I believe that there is not yet quite enough support, but there are a lot of good policies in place, especially in NSW. Victoria is looking to catch up. Generally speaking, Australian governments don’t yet have clear support mechanisms in place needed to bridge the gap between capital costs for carriers if they want to invest in a hydrogen truck. However, this gap is expected to narrow quite rapidly over time with increases in manufacturers offering hydrogen truck options, and higher volumes of production. There is a real need to recognise the value of the abatement that is created by hydrogen transport; and currently, Australia is behind, as there are no fuel efficiency standards.

Are these governments more or less supportive than the NZ government?

David Heard: New Zealand has better policy architecture, such as clear schemes to support truck purchase cost and hydrogen fuel cost, but not necessarily enough money allocated. In Australia, it’s the opposite - the money has been identified in state and federal budgets, but it isn’t yet clear how it is going to be deployed to best support growth in low-emmisisons trucking.

What is the state of progress in NZ? 

David Heard: The final investment decision on our network in September 2021 was to build 4 high capacity stations in the North Island, strategically located to cover major freight routes (95%). We received support from the NZ government in the form of a concessional loan and grants for the initial truck fleet. We are at the final stages of bringing equipment from global suppliers onto the sites, and we hope to have several of these initial stations up and running before the end of this year - we are well into the site commissioning phase now.  

Why is Hiringa’s partnership with Ofload so important?

David Heard: I see this partnership as particularly critical because it’s important to partner with customers and find ways to talk to shippers about their emissions. Then, you can start the conversation around potential solutions and commitments. For me, that’s what’s most important in the partnership with Ofload.

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