Dropping solar and wind costs means renewable exports could replace gas and coal

The Australian Renewable Energy Agency set to announce that hydrogen projects will become one of its new investment priorities in the coming year, just as the country is being urged to maintain its status as a major energy exporter.

The government is being told that “green fuel” exports – powered by wind and solar – could reach $40 billion a year in the next few decades, a market equivalent in size to the export coal industry, and essential if Australia is to maintain its pivotal position as a major fuel supplier in a decarbonised world.

Hydrogen is also being pushed as an alternative to battery storage and pumped hydro to store “excess” wind and solar output in Australia, particularly in wind and solar rich South Australia, and is also seen as a potential transport alternative to electric vehicles as petrol-fueled internal combustion engines are phased out.

So far the push to renewable-based hydrogen is being led by South Australia and the ACT, the two states and territories with the biggest commitment to wind and solar energy.

The ACT, which expects to source the equivalent of 100 per cent of its electricity needs from wind and solar, has facilitated $180 million into hydrogen investments, including an electrolyser, a fuel cell trial and using hydrogen to store excess wind and solar.

South Australia, which is already meeting 50 per cent of its local demand through wind and solar, and could jump to more than 80 per cent within five years, has also commissioned a major study into the hydrogen economy, both for storing excess wind and solar, and as a possible export, as we reported earlier this week.

The new enthusiasm from ARENA, driven by the plunging cost of solar and wind energy, is creating what Siemens Australia head of strategy Martin Hablutzel says is a potential “tipping point” for the concept.

“The catalyst to this being topical is the big reduction in wind and solar costs, and the whole conversation about storage,” Hablutzel said in a phone interview. “If you go back 10 years, the economics didn’t stack up.  But we are now reaching a tipping point.

“(Australia) can maintain role as a major global power exporter – beyond coal and gas. But we need to start thinking about how we can continue to be a major supplier” in a carbon constrained world, he said.

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Giles Parkinson


  1. Hi Giles, when we stop exporting coal (which can’t come soon enough), how do we export energy produced by renewables?
    I mean in what form? Batteries?

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