Owing to the increased awareness of the threat of climate change, the world is experiencing a global energy transition from fossil fuels such as coal, to renewable sources such as solar. 

The decarbonisation of global energy systems drives markets today, but in Africa, the energy landscape has been described as a paradox, because although the continent possesses abundant access to energy resources, especially solar and wind, more than half of its population still lacks access to energy.

The case for clean energy in Africa has never been more compelling as a result of increased demand due to the rapidly growing population, urbanisation, industrialisation and trade, among other factors.

Hydrogen, the most abundant chemical substance in the universe, has been touted as one of the resources that could play a major role in our future economies — particularly green hydrogen. Countries, including South Africa, have either recently developed or are now developing green hydrogen roadmaps to support the decarbonisation of their economies by 2030. Others include Germany, France, Japan, the US, Portugal and China.  

South Africa goes into COP26 with the intention of being recognised as a country that can play its part in the global fight against climate change. The development of a green hydrogen economy is expected to be a significant enabler towards global net-zero greenhouse gas emissions by 2050, not only in South Africa, but across the African continent.

Framework supporting the adoption of green hydrogen

British High Commissioner to South Africa, Nigel Casey, in his presentation at the Second Renewable Hydrogen and Green Powerfuels webinar in April 2021, asserted that in terms of mitigating the global effects of climate change, there is already a framework in place, the Paris Climate Agreement of 2015, signed by 197 countries, including all African countries, thereby committing to cut greenhouse gas emissions and to limit global temperatures. Of those, 190 have hitherto solidified their support with formal approval.

The Paris Agreement has charted a new course in the effort to combat global climate change, requiring countries to make commitments and progressively strengthen them. The key imperative for countries is to deliver on the pledges therein. Most opportunities to realise these ambitions for a low carbon future lie with the private sector, Casey said.

South Africa’s Industrial Development Corporation, for example, has been given the mandate to drive the commercialisation of the green hydrogen economy in the country by actively forging partnerships with the private sector to fund opportunities across the green hydrogen value chain.

Also at the webinar, South Africa’s Minister of Trade, Industry and Competition, Ebrahim Patel, noted that the world is yet to meet its climate change goals as per the Paris Agreement. He said that green hydrogen (also referred to as “clean hydrogen”) can play a significant role in addressing the effects of climate change by helping to achieve global net-zero ambitions. Patel said a hydrogen economy could ensure a just transition by decarbonising a greater range of sectors than renewable electricity alone, thereby acting as the missing link to achieving net-zero by 2050.

The above sentiments have been echoed in subsequent iterations of the webinar, and similar forums, by stakeholders in the renewable energy sector, both domestically and internationally. Specifically, at the Third Renewable Hydrogen and Green Powerfuels webinar in June 2021, outgoing German Ambassador to South Africa Martin Schäfer expressed confidence that a just and sustainable energy transition will open up opportunities for South Africa to enhance economic growth, promote social wellbeing and social justice, and lead to a low carbon and sustainable future. He also stated that the development of green hydrogen is bound to establish South Africa as a powerhouse in energy transition.

In addition to the Paris Agreement, the United Nations Sustainable Development Goals (SDGs) are significant, as they consist of a call for action for countries to play their part in combating the climate concerns of today and protecting the planet for future generations. These broad and interdependent goals chart a way towards a sustainable future, with energy acting as a catalyst to achieving the SDGs.

Apart from SDG 7, which advocates for access to affordable, reliable, sustainable and modern energy, SDG 13 is particularly significant as it encourages all nations to take urgent action to combat climate change and its impacts.

The case for green hydrogen

There is growing consensus that a decarbonisation path based on (quasi)-exclusivity on electricity networks (ie, an “electricity-only” model), is unrealistic and would be too costly. Therefore, it is necessary to incorporate hydrogen gas, as it is clean and affordable, to satisfy not only current global demand, but also the energy needs of future generations.

For South Africa, the country will inevitably adopt cleaner sources of energy as one of its key export commodities — coal — faces imminent collapse owing to the global energy transition. The government has identified the green hydrogen economy as a priority area to achieve a just and fair transition that prioritises inter alia, poverty reduction, job creation and climate resilience.

Hydrogen is of strategic importance to South Africa. President Cyril Ramaphosa, when responding to a debate that emanated from his most recent State of the Nation Address, highlighted the Hydrogen South Africa Strategy (HySA), stating that after a decade of research, the country is prepared to manufacture hydrogen fuel cells. South Africa is also moving away from fossil fuel technologies and embracing innovative renewable technology solutions such as finding storage for orthodox renewable energy such as solar and wind.

The growing momentum in the adoption of green hydrogen as a viable source of clean energy is largely attributed to the following factors:

First, the gradual decline in the cost of wind and solar energy has opened up the prospects for large-scale production of green hydrogen in countries such as South Africa that are well endowed in solar and wind energy, thereby ensuring that the production of green hydrogen is cost-effective.

Second, the acknowledgement that the world cannot decarbonise energy systems solely by enforcing green electricity — electricity derived from renewable sources — is another key influence. It is more efficient and cost-effective to achieve decarbonisation through hydrogen, which is also suitable for long-term and seasonal storage of renewable electricity.

Third, existing gas infrastructure can be leveraged to transport hydrogen, with limited adjustment and costs. In countries that have existing natural gas networks, hydrogen can also be blended (up to 15%-20%) in the gas grid, in a transitional phase, thereby significantly enhancing its potential.

Hydrogen plays a critical role in the world economy with application in the industrial, energy and transportation sectors, especially as the world becomes more reliant on renewables as its primary source of energy. With respect to the transportation sector, hydrogen is used across both the road and rail sectors as a result of the advancement of fuel cell technology. It also offers a simple decarbonisation alternative in the generation of heat and power within households, to provide alternatives to carbon-intensive diesel generators.

The use of hydrogen for industrial heat and chemical feedstock offers a plausible decarbonisation alternative for large scale-industrial heat users. Hydrogen is also used in the energy sector, as it can help solve the intermittent supply issues associated with renewable energy by utilising the electrolysis process to convert excess electricity into hydrogen during times of oversupply, which can then be used to generate power through either fuel cell or direct combustion in gas turbines when needed. 

Furthermore, hydrogen can lower energy costs, increase the flexibility of power systems and facilitate the decarbonisation of industries. Apart from green hydrogen possessing the capacity to act as a long-term storage system for excess clean hydrogen, it would potentially cushion Africa from exposure, considering the threats of geopolitical and oil price volatility. 

South Africa’s comparative advantage in green hydrogen

In February 2021, the Council for Scientific and Industrial Research (CSIR) published a report on power fuels and green hydrogen which affirmed that due to South Africa’s vast wind and solar resources, the country has a comparative advantage in producing and exporting green hydrogen.

South Africa is also well-positioned for large-scale production of green hydrogen technology due to its large reserves of platinum group metals (PGMs) such as platinum and palladium. It is the world’s largest producer of PGMs, which are the main raw materials in the synthesis of catalysts, vital for the electrolysis process when producing green hydrogen. South Africa is already producing cost-effective catalysts because of the availability of PGMs, therefore the country can produce cheaper electrolysers than most other countries and export, not only hydrogen, but also electrolyser components, which tend to be costly.

Additionally, the country’s expertise and technical capabilities around the Fischer-Tropsch Process stand South Africa in good stead and is another major contributor to its comparative advantage in producing green hydrogen. 

Despite South Africa’s potential to become a key player in the global green hydrogen economy, there are a number of challenges to large-scale production. Problems around its production, transport and storage have inhibited its growth as an alternative to fossil fuels. One of the key barriers to large-scale production is that there is little opportunity for independent power producers (IPPs) to contribute to production. This challenge arises because utility-scale IPP renewable energy projects are required to be dedicated to producing and selling power to Eskom, and are restricted from selling excess power to the national grid or to third parties.

Another challenge is that as a result of the acute water shortages in South Africa in recent years, the government is likely to prioritise achieving sustainable water resources for communities and the environment over the use of such water for the production of green hydrogen. It is estimated that to produce only one ton of hydrogen through electrolysis requires an average of nine tons of water. Although purifying water to be used for electrolysis is inexpensive, since most of the cost in desalination comes from the electrons, transporting it to the site of an electrolyser could be an impediment, as it is expensive and could pose logistical challenges.

Since the electrolysis process requires a location with access to renewable energy sources such as wind and solar, electrolysers need to be located close to either a solar or wind farm, which may not be in close proximity to a water body, hence the costs for transportation. Additionally, a grid connection is required to wheel either from the solar or wind farm. It is therefore better to locate electrolysers close to hydrogen consumers, as transportation of hydrogen is expensive. These cost issues could be another hindrance to the large-scale production of green hydrogen in South Africa.

Conclusion

Pursuant to their commitments under the Paris Agreement, all countries will have to play their part in mitigating climate change, and this will affect the nature of trade, production and investment. Without investment in renewables, including green hydrogen technologies, achieving net-zero greenhouse gas emissions by 2050 would be unrealistic.

For South Africa, continued support from the government in terms of putting in place appropriate policies and a conducive environment for investments is imperative to ensure a fair and just transition. With such factors in place, the fast-growing sustainable hydrogen economy could prove to be the missing link to not only achieving net zero, but to alleviating the access to energy constraints that South Africa and other countries throughout Africa face. OBP/DM

Kennedy Chege is a researcher and PhD candidate in Mineral Law in Africa in the law faculty at the University of Cape Town.

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