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Japan is planning to reduce its dependence on fossil fuels by replacing them with hydrogen, Bloomberg reports, citing a project by Kawasaki Heavy Industries—the only Japanese company working on a hydrogen supply chain.
The Hydrogen Energy Supply Chain is, however, a partnership between KHI and Australia, which will supply the fuel in liquefied form to be used in power generation plants instead of fossil fuels. The hydrogen will be produced from lignite coal. The pilot phase of the project will cost $364.35 million (A$500 million), AFP reported last week.
The project is one of the few ways Japan could use to decarbonizes its economy. Unlike Europe or the United States, the country is not well suited for large-scale solar and wind developments for the sheer lack of land. It is also a resource-poor country, which makes it reliant on fossil fuel imports.
Hydrogen is not something new in Japan: there is production from gas and oil, with the resulting fuel used for micro fuel cells, fuel cell vehicles, and experimental power plants. However, local production is expensive, so the alternative of importing hydrogen produced from cheap lignite coal in Australia appears to be an attractive one, despite the additional costs of chilling the fuel and transporting it from Australia to Japan.
“Hydrogen is indispensable for Japan to reach the zero-emission goal,” the head of the hydrogen project at Kawasaki Heavy Industries told Bloomberg in an interview. “Renewable energy alone isn’t enough to meet the nation’s hefty energy needs,” Motohiko Nishimura added.
It will need substantial investments in addition to the HESC project. According to awareness advocacy Asia Investor Group on Climate Change, Japan could need $425 billion to build a hydrogen supply industry that would cover 40 percent of its energy needs. The commercial use of hydrogen is seen to start in 2030, according to KHI’s Nishimura.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com
This sure sounds and smells like an accountant's wet dream like cap and trade. More smoke than mirrors. Japan gets the credit for the greening of the economy and the Australian government denies there are any fossil fuel issues at all, and so doesn't care at all.