What is the difference between clean and green energy?

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JEREMY MAGGS: Many large energy users do not see natural gas necessarily as a viable option for the production of hydrogen. This is a view that’s been put forward by diversified minerals and investment group, Siyakhula Sonke Empowerment Corporation [SSC]. Renewable energy head, Andries van der Linde, is with us now as the hydrogen debate gathers some steam, and that pun is intended. So, Andries, firstly, can you elaborate on why large energy users might be reticent in this respect?

ANDRIES VAN DER LINDE: Yes, when it comes to natural gas you still have your carbon component and there’s a general move towards going totally green, and that’s why the big energy users, especially the mining companies with an international footprint, they would really like to go altogether green.

JEREMY MAGGS: But is there a difference between clean and green in the energy sector, and maybe the latter is more desirable for mining companies. Why would that be the case?

ANDRIES VAN DER LINDE: Ja, okay, let’s look at green first. Green is actually totally renewable, totally green, where you actually produce, if you look at hydrogen, you produce it from a renewable energy source because hydrogen is produced using an electrolysis plant, which splits your water into hydrogen and oxygen, and that uses electricity. That electricity must come from a green energy source.

When it comes to natural gas, although they call it clean, it’s clean as opposed to coal and diesel, petrol and so on, because your carbon emissions are higher. With coal, as well as diesel, also have all these other emissions as well, like particulates when it comes to coal, especially in South Africa.

Our coal has a lot of sulphur in, so it actually produces a lot of sulphur dioxide and that, of course, combines with the moisture in the air, and then you have these acid rains, which in fact, a couple of years ago, nearly wiped out the Black Forest in Germany.

JEREMY MAGGS: Ultimately, though, isn’t any decision predominantly going to be based on cost?

ANDRIES VAN DER LINDE: You’re so right. But it’s actually moved away from that to some extent because, as a matter of fact, the Russia-Ukraine war has actually taught everybody that the reliability of supply is actually cheaper than a cheap energy source, which you cannot rely on.

JEREMY MAGGS: So how do you see green hydrogen then ultimately helping in ensuring stability for the big mining companies?

Read/listen: Green hydrogen: An ‘opportunity to completely reindustrialise SA’

ANDRIES VAN DER LINDE: Well, one of the big advantages of hydrogen, and I feel very strongly about it, is that hydrogen is something that any country can produce. Let’s put it like this, a country where [there is] wind or solar or even hydropower can actually produce their own hydrogen, or a mining company can, in fact, produce hydrogen on-site so they can actually produce hydrogen, use an internal combustion engine of some sort, piston or a turbine, and then they’re totally independent. They get away from the logistical issues, and it’s actually a win-win for all.

JEREMY MAGGS: So your company’s involved now in this Jeffreys Bay hydrogen project, so maybe provide more insight, if you can, into what is actually happening, but more importantly, how could it help influence South Africa’s move towards more sustainable energy sources?

ANDRIES VAN DER LINDE: Okay, the objective of this project in Jeffreys Bay is purely to produce hydrogen. Actually, let’s put it differently, not just hydrogen, but additional products that you can actually derive from hydrogen, like for instance, ammonia, because what a lot of people lose sight of is there is a whole range of products that actually starts off with hydrogen.

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So this project is actually a 225 megawatt wind farm and we will have 135 megawatts of electrolysers connected to that specifically for hydrogen production. The reason why we went for that approach, and that’s actually a global trend as well, is because we find that if you dedicate a wind or a solar farm to hydrogen production, then it actually has a positive effect on costs because the cost of the electricity that you produce is directly connected to your capex.

Whereas say for instance, if you go to Europe, you’ve got wind farms all over the show so that the wind farms there are connected to your grid. So if you say, well, I want to produce hydrogen from the grid, but I want to only use, say, renewable energy from the wind turbines, you’ll still, even if they administratively can prove that you actually, although it’s very difficult, only use the wind energy component, you still pay grid prices. Whereas in our case, we don’t pay grid prices for our electricity, our price is directly connected to our payback period, which we select.

JEREMY MAGGS: So what’s the big lesson here that you’ve learnt for people going into this space?

ANDRIES VAN DER LINDE: Well, you must just be innovative in your whole approach. At the same time, you must be, not just with the way you actually package the technology, but how you approach it from a financial perspective and how you actually package your payback period into your business plan.

Let’s put it differently, it’s not a quick fix or a short-term money-making approach because you don’t make your money overnight.

You’ve got to be patient, but the money will come, and that’s the only way you can actually get a proper hydrogen project off the ground and at the same time, make it economical in the long run.

JEREMY MAGGS: Andries van der Linde, I’m going to leave it there. Thank you very much for the insight.

Read:
How to grow South Africa’s hydrogen economy
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