By: Green building Africa

A recently published paper explores the opportunity for South African green hydrogen producers presented by the electricity supply crisis that has been ongoing since 2007. 

It highlights the potential for a mutually reinforcing growth cycle between renewable energy and green hydrogen to be established, which will contribute not only to the mitigation of greenhouse gas emissions but to the local economy and broader society.

The paper finds that that leveraging renewable energy (RE) investments to develop green hydrogen (GH2) is win-win from an industrial development perspective, and that RE investment represents a no-regret first step in developing large-scale GH2 projects, while simultaneously contributing to addressing the electricity crisis.

Among other considerations, GH2 can result in growth of the local RE industry and local generation infrastructure, leveraging the flexibility in production and the ability to oversize infrastructure to sell power into the national grid. The joint deployment of RE and GH2 also brings several JET benefits.

The paper also highlights that the RE sector is also facing challenges in many developing countries, notably including South Africa, which are related to insufficient capacity and outdated technologies on the national electricity grid. This prevents the evacuation of power from areas with high renewable resources, both to meet national electricity demand and to supply remote GH2 production sites. Resolution of this issue, and a number of other potential future challenges facing the RE sector, need urgent resolution to maximise the potential opportunity from the coupling of the GH2 and RE sectors.

It is recognised, however, that development of the GH2 sector potentially faces several challenges, not least of which is the perception that GH2 diverts much-needed electricity from grid supply to the detriment of local consumers and services delivery, and that the export of GH2 and its derivatives results in the diversion of local resources into the global north.