Japan and South Korea can become major green hydrogen demand centres if they put the right conditions in place – some reflections on which strategies

Solving Japan and South Korea’s renewable energy conundrum with green hydrogen?

While it is right that Japan and South Korea deploy as much domestic renewable energy capacity as possible to green their grids, it is clear that both countries will also need to import large amounts of green hydrogen or green ammonia to decarbonise their significant industrial sectors. Government schemes currently being implemented will be decisive in whether this becomes a reality.?

A roundtable in Tokyo and some reality checks on the true emissions intensity of blue hydrogen?

At a roundtable in Tokyo this week organised together with Breakthrough Energy as part of the Asia Pacific Green Hydrogen Alliance, we brought together forty participants from industry including banks like Sumitomo Mitsui Trust Bank, green hydrogen producers such as ACME, Adani, Marubeni and Fortescue; and customers like IHI and Mitsui O.S.K Lines. We examined how the country can ensure green hydrogen reaches the country’s shores to help it move away from oil, gas and coal in industry and supplement its relatively low renewable energy capacity with green molecules.?

All eyes are on Japan’s Contracts for Difference Scheme and its detailed regulations which are due to be finalised over the next couple of months. A key issue will be the degree to which blue hydrogen made with from fossil gas with carbon capture is able benefit from the USD 19 billion subsidy scheme which will provide 15 years of support for successful projects. We made the case in a separate meeting with officials from Japan’s Ministry of Economy, Trade and Industry (METI) that forms of blue hydrogen which are not truly low carbon risk crowding out green hydrogen and slowing Japan’s decarbonisation journey and will make a submission via a white paper to the government in September.?

To demonstrate this point we previewed some new data from a report we will publish next week with the Green Hydrogen Catapult (an initiative established by RMI and the UN High Level Champions) which shows that unless hydrogen import-dependent countries like Japan and South Korea include rigorous site specific measurement of upstream methane emissions and fully include transport and other parts of the hydrogen life-cycle up until the point of consumption, their schemes risk masking between 43-67% of the true emissions associated with blue hydrogen (in this case using an example of exporting blue hydrogen from Australia). In South Korea this issue has led NGOs such as Solutions for Our Climate (SOFC) to challenge the notion that blue hydrogen can be considered ‘clean’ in the country’s constitutional court (which also ruled this week that the country’s climate targets are inadequate to protect citizens).?

Both Japan and South Korea appear set to follow the hydrogen emissions measurement methodology currently being drawn up as an ISO Standard which risks lacking a robust approach to measuring upstream methane leakage and strong conditions on carbon storage. GH2 and other organisations continue to engage with the ISO to raise these concerns.?? ?

Supporting electrolyser manufacturers??

The fraught issue of whether to favour green hydrogen made with Japanese technology such as electrolysers also came up which poses a dilemma given that electrolysers from China can bring the cost of green hydrogen down by two thirds compared to those manufactured in certain OECD countries, as presented by BloombergNEF 's Kathy Xitong Gao during the roundtable. This issue is not restricted to concerns in Tokyo and Seoul, but also in Brussels as many European electrolyser manufacturers argue for support schemes to ensure a level playing field on electrolysers.??

Co-firing with coal and natural gas is an issue which is not going away?

During our meetings in both Tokyo and Seoul, industry and government made the case for using imported green and truly low carbon hydrogen in the power sector, including through co-firing power plants with green ammonia and coal or natural gas. While green hydrogen is a precious resource and there are more efficient places to deploy green hydrogen – notably in each countries’ sizable steel, shipping and aviation sectors – it is proving an alluring demand sector for international producers from India and elsewhere as Japan and South Korea try to figure out how they can transition away from fossil fuel power generation. Indeed South Korea’s first subsidy auction is focused on hydrogen-fired power generation where it was reported earlier this week that of the 26 companies being considered for a subsidy, 24 of them are set to export to South Korea rather than produce hydrogen domestically (the winners of the auction will be announced in November). What is clear is that where a government is intent on going down this route, it is essential to have a clear end-date, align emissions reductions with national targets and of course use only use the lowest carbon green hydrogen.?

Joe Williams

Deputy CEO

Green Hydrogen Organisation

GH2 and Indonesian Government sign an MoU

Today in Jakarta the Indonesian Ministry of Energy and Mineral Resources and GH2 signed a Memorandum of Understanding to collaborate on implementing Indonesia’s national hydrogen strategy. The MoU includes four key areas of collaboration: policy and regulations; increasing market opportunities and investment; financing mechanisms and regional collaboration, notably through the Asia Pacific Green Hydrogen Alliance which was initiated by GH2 and Breakthrough Energy earlier this year.?

The MoU was signed by Professor Eniya Listiani Dewi, Director General of New, Renewable Energy and Energy Conservation at the Ministry of Energy and Mineral Resources; and Jonas Mobergy, CEO of the Green Hydrogen Organisation. Professor Dewi noted in her remarks that establishing a green and truly low carbon hydrogen ecosystem in the country will help Indonesia achieve its emissions reductions targets, and there are great opportunities to use the country’s vast geothermal and hydropower renewable resources to produce green hydrogen for industrial decarbonisation. She explained how the signing of the MoU is a step towards that goal.? ? ? ? ? ? ? ? ? ?

GH2 looks forward to working with the Indonesian government and other stakeholders to develop the country’s renewable energy sector.??

Join GH2’s call for ambitious, specific and actionable NDCs?

Together with the Global Renewables Alliance, GH2 urges organisations and companies from around the globe to join a call on governments to set ambitious, specific and actionable renewable energy targets in the updated national climate plans by February 2025. By adding your logo, you’ll join a global coalition moving policies to accelerate the achievement of the global #3xRenewables target. ?

Read the open letter: https://globalrenewablesalliance.org/wp-content/uploads/2024/08/GRA-Open-letter_NDC-1.pdf ?

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Corporate Sourcing in the spotlight at GRA flagship event in South Korea

The Global Renewables Alliance’s ‘Time 4 Action: Corporate Sourcing’ forum in South Korea is set to bring together top decision-makers and industry leaders from across the globe to tackle the urgent need for accelerating renewable energy adoption. Focused on overcoming challenges and unlocking opportunities in corporate clean energy procurement, participants will explore how government-corporate collaboration can build a fair and robust market for renewable energy offtake, driving significant progress in the APAC region and worldwide.? ?

Register now: https://globalrenewablesalliance.org/c-s-events/apac-wind-energy-summit/ ?

Global Renewables Alliance (GRA)

Upcoming Events

GH2 India Green Hydrogen Webinar Series (GHWS) 2024

Join us on our 4th Webinar in the GH2 India Green Hydrogen Webinar Series (GHWS) 2024 on Thursday, 5th September at 1600 IST/ 1230 CEST!

This webinar will focus on discussing the use of hydrogen in glass manufacturing and in stationary energy production such as in CHP systems.

Sign up here

Please reach out to [email protected] for any queries.

GH2 India

Venice Hydrogen Forum 2024

The Venice Hydrogen Forum,?organized jointly by GH2 and Venice Sustainability Foundation is a ministerial and CEO level international meeting on the transport, offtake and project finance of hydrogen and its derivatives across the Mediterranean. It will focus on the connection between European hydrogen infrastructure and major green hydrogen production centres in North Africa and the Middle East.

It is designed as a semi-retreat for high-level decision makers to push the needle on agreements and policies to develop cross-Mediterranean hydrogen trade which is urgently needed and ensure local value creation wherever green hydrogen is produced.

Check out the updated agenda here.

Find out more here on how to participate.