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Speaker 1: Let's talk about green hydrogen. Change of topic, from which

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Speaker 1: Tail Eagles and I read with great interest an opinion

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Speaker 1: piece that's in The Australian today written by Judah Sloan,

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Speaker 1: Professor Judah Sloan, contributing Economics editor to The Australian, in

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Speaker 1: which she makes note of the fact, well, this is

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Speaker 1: old news now that ford Escue Andrew Forrest has canceled

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Speaker 1: his green hydrogen project. That was a couple of months back.

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Speaker 1: What is newer is that origin we're proceeding with hydrogen

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Speaker 1: green hydrogen in the Hunter Valley. They've decided to cancel that.

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Speaker 1: The costs everything else just don't stack up. So Professor

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Speaker 1: Sloan goes on to then have a look at a

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Speaker 1: couple of other government projects around the place, and one

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Speaker 1: is the state government project five hundred and ninety three

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Speaker 1: million dollars of taxpayer money going into green hydrogen in

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Speaker 1: Wayala to create green steel at the steel works there.

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Speaker 1: What's the future of that, Judah Sloan, good morning to you,

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Speaker 1: thank you for your time. Yep, where are you gone here?

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Speaker 1: There we go? Got you on, Judath, good morning and

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Speaker 1: what does this mean for Whyella? Moving forward?

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Speaker 2: Well, let me say, the outset. I feel incredibly sympathetic

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Speaker 2: to the workers and residents in Whyela. You know, there

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Speaker 2: are some incredibly skilled, knowledgeable workers up there who really

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Speaker 2: do understand how steel mills work. And I think it's

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Speaker 2: been a very troublesome time. And I understand that there

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Speaker 2: have been some playoffs and some slow payments for contractors

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Speaker 2: and the like. So I think there is a high

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Speaker 2: degree of uncertainty there. But you know, I guess we

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Speaker 2: all like to dream, but I think green hydrogen is

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Speaker 2: definitely in the category of a fairy tale at this point.

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Speaker 2: And you know, I really am very uncertain about whether

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Speaker 2: the Melanauscus government is well advised to be allocating such

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Speaker 2: a large sum of money to creating a green hydrogen

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Speaker 2: hub in that area when it's not clear, as you said,

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Speaker 2: that commercially, and indeed just not in Australia but around

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Speaker 2: the world, that a lot of private players are having

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Speaker 2: a great deal of difficulty in progressing green hydrogen as

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Speaker 2: a commercial product.

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Speaker 1: What is the problem. And I suppose for most of us,

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Speaker 1: we've no idea how steel works works. We know it

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Speaker 1: needs a lot of heat to melt to create the

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Speaker 1: ore to turn it into steel and that comes from

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Speaker 1: at the moment coal to create the fire in the

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Speaker 1: blast furnace. What difference will green hydrogen make to that?

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Speaker 2: Well, that's right at the moment. The steel mill has

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Speaker 2: a traditional glass furnace based on coal. So basically you

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Speaker 2: mix coal, iron and extremely high levels of energy to

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Speaker 2: get up to the required temperature point and the end

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Speaker 2: result of the steel. So, you know, one of the

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Speaker 2: alternatives is to use what's called an electric arc and

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Speaker 2: that the electricity would you know this is this is

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Speaker 2: part of the tail would be generated by green hydrogen,

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Speaker 2: and that is an alternative method of making steel. Now

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Speaker 2: you know, there are some prototypes going on. It looks expensive.

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Speaker 2: There's some technical issues about whether you can actually get

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Speaker 2: to the required temperature using hydrogen. This is obviously a

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Speaker 2: really important point. And here's the thing is that can

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Speaker 2: you command a price premium in the market for generating

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Speaker 2: green steel? So we've got green hydrogen, and then the

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Speaker 2: idea is that you can use green hydrogen. Bear mind,

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Speaker 2: green hydrogen is produced and there are issues there from

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Speaker 2: renewable energy. Is there a price premium for green steel? So,

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Speaker 2: you know, I think there are a lot of you know,

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Speaker 2: ifs in this equation, and I'm quite surprised, you know,

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Speaker 2: having once upon a time been to South Australia and

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Speaker 2: then to sort of regard myself for still a bit

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Speaker 2: of a South Australian that I think Malanaskus strikes me

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Speaker 2: as being a very savvy and well informed politician who

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Speaker 2: is running the state pretty well. But this looks like

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Speaker 2: a bit of a sort of exception, should I put that?

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Speaker 1: Has this worked anywhere around the world?

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Speaker 2: No, I mean, don't get me wrong. I think there

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Speaker 2: is some stuff going on, and when you can generate

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Speaker 2: the hydrogen with essentially free resources, and hydro and probably

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Speaker 2: nuclear would be better ways to generate the hydrogen, and

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Speaker 2: maybe you've got some pure water coming off glacier, so

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Speaker 2: there might so, Matthew, the first bit of this project

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Speaker 2: possibly makes sense. They want to use the excess renewable

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Speaker 2: energy in South Australia to power a de cell far

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Speaker 2: that kind of makes some sense, But that water will

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Speaker 2: be used mainly to expand Olympic Dam and the copper mind,

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Speaker 2: I mean, copper is a pretty good commodity going forward,

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Speaker 2: so I'm kind of okay with that. But then I

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Speaker 2: think that the dream is that we'll use that purifies

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Speaker 2: de cell generated water to kickstart this green hydrogen because

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Speaker 2: bear in mind, so hydrogen is just H two, but

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Speaker 2: you have to have very pure water to start with,

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Speaker 2: and that is again one of the technical challenges in

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Speaker 2: a green hydrogen industry.

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Speaker 1: Okay, there's a paragraph you' written in the article. Let

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Speaker 1: me ask you about this. The World Steel Association estimates

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Speaker 1: that to replace cochin coal with green hydrogen would require

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Speaker 1: an electricity system with a capacity more than the current

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Speaker 1: capacity of the entire European Union. We wouldn't be within

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Speaker 1: coui of that, would we.

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Speaker 2: No, Well, this is the point. I mean, I do

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Speaker 2: think there probably is some excess renewable energy in South

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Speaker 2: Australia because you know, they, let's face it, you know,

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Speaker 2: went crazy with the turbines and side of panels of

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Speaker 2: the light. But it only makes sense if you've got

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Speaker 2: additional renewable energy. So there is no point basically cannibalizing

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Speaker 2: renewable energy from existing uses, which is, for example, to

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Speaker 2: power households and businesses. So it is in addition and

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Speaker 2: that that was the project of the World Steel Association,

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Speaker 2: which is that and in fact I've got some other figures,

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Speaker 2: you know, I do like figures message there, which just

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Speaker 2: shows you the extent to which you need some ancillary investment,

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Speaker 2: particularly in renewable energy. And it's you know, good example

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Speaker 2: of up there in Gladstone to make this work. And

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Speaker 2: so it's very easy to come to the conclusion that

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Speaker 2: this really is not a goer and you might need

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Speaker 2: to think of other things go But you know, I

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Speaker 2: come back to Wayala. You know, let's let's hope it

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Speaker 2: has the future. I mean, it is the only steel

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Speaker 2: miller in Australia that produces steel for the railway, so

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Speaker 2: it would be a terrific lot if it were to fail.

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Speaker 2: But I mean the trouble is that the current owner

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Speaker 2: and you know, I don't want to say anything defametry,

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Speaker 2: do I be you know, it is it is well

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Speaker 2: known that you know, his his group, his company group

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Speaker 2: has had difficulties including even you know, simple things like

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Speaker 2: providing orders to account. So you know, I think, you know,

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Speaker 2: maybe we should have a conversation about this time and

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Speaker 2: hopefully it will be some more positive one for Wiler.

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Speaker 2: I mean, don't forget that the blastphoern has had to

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Speaker 2: be taken out of action for quite some time earlier

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Speaker 2: this year, which was very unfortunate and was probably the

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Speaker 2: result of not quite spending them out of money they.

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Speaker 1: Should have been on all right, Judisloane, appreciate your time.

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Speaker 1: Thank you for your time this morning contributing economics editor

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Speaker 1: to The Australian her opinion piece in there today, and

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Speaker 1: it questions the future of green hydrogen generally with ford

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Speaker 1: Eskeu pulling out. If someone like Andrew Forrest, who is

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Speaker 1: very keen on environmental change in climate change solutions, has

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Speaker 1: decided to pull out of green steel because he couldn't

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Speaker 1: make it work, and now Origin Energy, which are no

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Speaker 1: slouches when it comes to developing ways of improving energy supply,

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Speaker 1: have decided green hydrogen is too expensive and can't work.

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Speaker 1: Then you think, well, what future for hydrogen in Wyala

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Speaker 1: which is a state government project? Now, I don't know

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Speaker 1: if there's endless taxpayer dollars to be thrown at it.

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Speaker 1: Five hundred and ninety three million, which is over half

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Speaker 1: a billion dollars has been allocated and hopefully it works,

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Speaker 1: hopefully we can lead the world in it. But I

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Speaker 1: don't know if Judas article is the most optimistic in

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Speaker 1: that regard. And the quote again from the World Steel

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Speaker 1: Association or the reference. Estimating that to replace cocin coal

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Speaker 1: with green hydrogen requires an electricity system with a capacity

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Speaker 1: more than the current capacity of the entire EU doesn't

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Speaker 1: give you a lot of hope moving forward.