Hydrogen in the gas grid is a great idea – if you own the gas grid

Some of us learned in chemistry class that hydrogen molecules can spin. But our teachers never told us how much spin we’d see, and how much energy it would take not to fall for it.

Hydrogen in the gas grid – it’s not something I wanted to write about.

I’d rather write about real economic solutions to climate change. I’d rather write how thousands of Australians are already saving money and improving their homes by embracing the all-electric, zero-emission, fully renewable future.   

But there’s a story doing the rounds I’d like to ignore, but I can’t.

No, it’s not the one about the lizard people controlling our minds from phone towers. It’s the one about how we should keep our homes and other buildings hooked on expensive fossil gas until someday hydrogen comes waltzing down our street.

Hydrogen in the gas grid is a great idea, if you happen to own the gas grid. For the rest of us, it’s a furphy, or worse, another climate-damaging tactic aimed at delaying our move away from fossil gas.

Hydrogen, whether it be created with renewable energy or not, will never compete economically with heat pumps in buildings for heating living spaces and water.

The idea of hydrogen

But what the idea of hydrogen can do is preserve the value of the gas grid on the books of the often foreign owned (*) gas distribution companies.

The companies that own the pipes and meters bringing fossil gas down our streets are aware their product is a damaging fuel. At the same time, they see building managers and home-owners saving money by switching off gas and over to renewable-heat-harvesting heat pumps. So, if you owned a gas distribution grid, what would you do?

Would you meekly admit the game is up? Would you plan for a quiet ramp-down and decommissioning of what was formerly an “essential service” that no longer makes economic, climate or health sense? Or to best serve your shareholders, would you look around for a marketing illusion to keep your business model working for a few years longer? Something like … hydrogen!

Yes, “green” hydrogen made from renewable energy (and water) will play a vital role in our zero-emissions future in large industrial-scale steel and chemicals manufacture. Green hydrogen may also have roles supporting our grid-electricity supply and in heavy transport. So certainly renewables-based hydrogen deserves and is getting support: money for research, development and deployment.

But will we discern the difference between hydrogen ideas worth pursuing, versus the public relations spin produced by vested interests looking to prolong their businesses-as-usual?

Hydrogen will never be free or even cheap

Hydrogen isn’t an economic proposition for widespread use in millions of Australian homes and other buildings for one main reason. Hydrogen is and will be too expensive to use in buildings.

As even the gas retailer AGL is now telling its customers, by far the cheapest way to heat Australian living spaces and water today is with air-source heat pumps. Sometimes called reverse-cycle air conditioners, these devices use a refrigerant cycle to capture free renewable heat from the air outside your home or building. A good thing about free heat is that it’s free!

Studies and real-life experience show that in Australia, heat pumps can heat for as little as a third of the cost of heating with gas. As a result, thousands of Australian homes and other buildings are moving off gas.

“We used our reverse-cycle air conditioning this winter in Canberra. Worked great. On track to save $1100” – Jacqui

(My Efficient Electric Home)

The problem with wholesale hydrogen is that it will be two to four times more expensive than gas.

In recent years, the wholesale price of gas has ranged from $8 to $12 a gigajoule (GJ).

According to the CSIRO, the current wholesale price for renewables-based hydrogen is around $40/GJ, four times the price of gas. This is why we don’t see anyone claiming hydrogen is an economically competitive source of energy today. But what about years into the future?

The cost of renewables-based hydrogen is expected to fall as production is scaled up, with the wholesale price of hydrogen potentially falling to half of current prices:  That’s around $20/GJ by the year 2030. But even with this dramatic price fall, hydrogen is still expected to remain far more expensive than fossil gas and therefore far, far more expensive than using a heat pump.

Further, there is more to the price of gas or hydrogen delivered to your door than just the wholesale cost of production. The costs of distribution and retailing can add another $10/GJ or more to the price you would pay at home today for gas or tomorrow for hydrogen.

Therefore, we see budget-conscious Australians making the switch to using free renewable heat collected by their heat pumps, cancelling their gas accounts and having gas meters removed from their properties.

Health and safety – who wants gas?

Beyond home economics, we are beginning to learn that we really shouldn’t be burning things in our homes, be that gas or hydrogen. According to the National Asthma Council, around 12 per cent of childhood asthma can be attributed to gas cooking at home.

But if the gas distributors have their way, we’ll continue to burn fossil gas in our homes for decades to come with each winter bringing reports of people overcome in their homes by carbon monoxide poisoning.

It’s nearly amusing to reflect that if gas were a product being brought to market today, it would never achieve health and safety approval, given that we have healthier, safer, and cheaper alternatives.

Climate saviour, or menace?

Finally, is hydrogen a climate solution? Or is it another climate menace yet to be exposed? Since hydrogen contains only hydrogen, it can hardly be called a carbon polluter. However, hydrogen has been classified as a secondary greenhouse gas.

Scientists are only now seeking to understand the climate impacts if we were to send hydrogen down every street to every house, with the inevitable leakage and release of this molecule into our atmosphere. 

Spinning and falling

Despite there being no obvious society-benefitting reasons to sell hydrogen to homes and other buildings, this hasn’t stopped the gas distributor’s lobby group from producing visions of how we will gleefully use hydrogen in the year 2050, delighted by its coloured flames.

One thing missing from those reports, however, is any mention of the costs of hydrogen and how it compares to modern heat pumps. But despite having nothing to say on costs, this hasn’t prevented lobbyists from making the rounds already to local councils spreading doubt about the benefits of fully electrifying our built environment.

Some of us learned in chemistry class that hydrogen molecules can spin. But our teachers never told us how much spin we’d see, and how much energy it would take not to fall for it.

Gas distribution companies operating in Australia that are at least partly foreign owned:

Tim Forcey is an energy advisor, researcher, author, engineer who has worked with the University of Melbourne as an energy adviser, a principal with the Australian Energy Market Operator (AEMO) and previously with BHP an ExxonMobil.