Hydrogen, an element described as "odourless, tasteless and colourless", is being hailed as a promising solution to the world's reliance on fossil fuels.
Energy and Resources Minister Megan Woods is calling for feedback from the public on the launch of the Government's national vision for hydrogen, released on Monday.
It lays out the role hydrogen can play in New Zealand's economy, including for transport, because of its ability to act as an eco-friendly alternative fuel for vehicles.
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Hydrogen could also provide economic export opportunities. Thanks to New Zealand's abundant renewable energy, Woods said New Zealand could produce some of the cleanest green hydrogen in the world.
New Zealand could potentially receive a premium for it in international markets. That is the strategic advantage the Government wishes to explore, and it's seeking public feedback.
"For a country blessed with abundant renewable energy, the ability to convert our clean electricity into green hydrogen which can fetch a premium on global markets is a major economic opportunity," Woods said.
"With hydrogen, we have opportunities to create new jobs, convert heavy transport away from fossil fuels, enhance our security of electricity supply and even generate significant export revenue."
She said there has been international interest already in New Zealand's hydrogen.
The Government signed a memorandum of understanding with Japan last year to encourage collaboration on hydrogen initiatives.
What is hydrogen?
Hydrogen is considered to be the lightest and most abundant in the universe, making up more than 90 percent of all matter.
It produces energy by reacting with oxygen and water is the only by-product as exhaust.
Hydrogen is not a primary energy source, however, and has to be made. Unlike natural gas, coal, or wind, it is an energy carrier that can transfer and store energy.
Energy from hydrogen can be produced in a number of ways, but the Government is focusing on what's been labelled "green hydrogen".
It is made by using an electrolyser, a device which splits water into hydrogen and oxygen using electrical energy. When the electrical input comes from a renewable source, hydrogen has no carbon footprint.
Hydrogen-fuelled cars are already being seen as a competitor to conventional battery-powered electric vehicles, since they can refuel quicker.
It could help change New Zealand's transport sector, which is responsible for 40 percent of the country's fossil fuel energy use.
Hydrogen passes through a fuel stack in the vehicle, where it interacts with oxygen. The process generates electricity and water, the latter which dribbles out from a tube at the back of the car.
The fuel cell converts the energy produced by a chemical reaction into usable electric power.
The process isn't new - NASA has been using the technology to power rockets for decades. But only recently have car manufacturers been able to make fuel cells small and mobile enough to fit inside passenger vehicles.
The Government predicts that the cost of hydrogen fuel will decrease.
It pointed to the International Energy Agency's 2019 report that predicted the cost of producing hydrogen from renewable energy could fall by 30 percent by 2030.
How else can it be used?
- It can be stored and transported over long distances
- It could replace carbon in industrial processes such as steel production
- It could generate electricity in dedicated hydrogen gas turbines
What are the challenges?
Greenpeace has pointed out that while the Government's vision for "green hydrogen" is promising, it does not want the Government to adopt "blue hydrogen" made from natural gas.
Other challenges include cost and technological maturity, safety, regulatory and policy uncertainty and gaps, infrastructure development, building the hydrogen economy, and utilising additional natural resources such as water.
The Government would also need to look at new renewable energy sources, and get rid of the perception of inefficient use of energy and the lack of understanding of it.
New Zealand already has the fourth highest renewable electricity percentage in the OECD but there is still significant untapped renewable potential, the report says.
The paper follows the Government's decision to end new offshore oil and gas exploration last year, and its investment in a National New Energy Development Centre in Taranaki.
You can submit on the national vision by Friday 25 October 2019.