Hydrogen Industry

Mr McBRIDE (MacKillop) (14:50): My question is to Minister for Energy and Mining. Can the minister inform the house where hydrogen development and industry will land following the Whyalla Steelworks' bailout and deferred green steel election promises? With your leave, and the leave of the house, I will explain, Mr Speaker.

Leave granted.

Mr McBRIDE: There have been a lot of expectations around hydrogen, desalination and cheaper electricity prices. There are also businesses and investors wanting to work with the Malinauskas government in directions towards a new energy source.

The Hon. A. KOUTSANTONIS (West Torrens—Minister for Infrastructure and Transport, Minister for Energy and Mining) (14:51): Hydrogen is one of those alternative fuel sources that is misunderstood by a number of people. I saw today the former foreign minister, Mr Downer, completely misunderstanding the role that hydrogen would play in decarbonising steelmaking. He thought the process that hydrogen would be used for would be to run an electric arc furnace. Electric arc furnaces are not what hydrogen is designed for. Hydrogen is designed to be a reductant, which will replace coking coal. This is a fundamental misunderstanding a lot of members have about what role hydrogen plays in decarbonising steelmaking. I want to explain to the member for MacKillop some of the basic—

Members interjecting:

The Hon. A. KOUTSANTONIS: Yes, I will trust the engineer. What I wanted to say to the member for MacKillop is that hydrogen's time is coming, and it is coming fast, because every jurisdiction around the world knows that they need to decarbonise steelmaking. Steelmaking makes up between 7 per cent to 12 per cent of the globe's carbon emissions. Steelmaking is not an industry that is going anywhere anytime fast. The question becomes: what do we replace metallurgical coal with? The first step will be natural gas.

Just to give some basic numbers to the member, when you use coking coal to beneficiate iron ore to iron, you create about two tonnes of carbon dioxide for every tonne of iron you produce. When you use natural gas, that drops from two tonnes of carbon dioxide to about 600 kilograms of carbon dioxide, a lot less than metallurgical coking coal, but still a considerable amount of carbon dioxide.

When you use hydrogen to remove the oxides as a reductant, you produce water vapour. That is the difference. There is no carbon dioxide emitted. This is a proven chemical process. That is the way you will decarbonise iron making. The only way we are going to make green steel is by using hydrogen. The question is: how do you manufacture the hydrogen? Of course, the green way of manufacturing hydrogen is to use renewable energy through an electrolysis process to make the hydrogen. The other way, of course, is the traditional way, where you would use either gas or you would use electricity from the grid, depending on whether it's bought, whether it's green, or otherwise.

The truth is, hydrogen is coming and it is coming fast. Korea, Japan, Germany, all the major steelmakers in the world, including India and China, know that the days of coking coal are coming to an end. Why? Because they know the planet is heating up and that carbon dioxide is a pollutant. Too much carbon dioxide in the atmosphere is bad for the planet. It is a proven scientific fact.

The reason we decided to put our Hydrogen Jobs Plan in Whyalla next to our largest iron ore reserves in the state and next to a steel mill is no coincidence. The reason we chose the steelworks is because we want to see hydrogen decarbonise our steelmaking processes, because if we can decarbonise iron making, we can go up that value chain and export a decarbonised iron product to the rest of the world.

Iron has other applications as well, and I will give you some of them. The shadow minister talked about hydrogen having a really fantastic ability to help clean energy going forward. He said it supports the transition to low-emission energies across not only electricity but also potentially going forward in heating, transport and industry as well. The hydrogen plan is not unique to us. It is just that others opposite attempt to politicise it.

Members interjecting:

The SPEAKER: Dr Karl, you have had your four minutes.

Mr Patterson interjecting:

The SPEAKER: The member for Morphett will come to order.

Mr Patterson interjecting:

The SPEAKER: The member for Morphett can leave the chamber until the end of question time.

The honourable member for Morphett having withdrawn from the chamber: