Minister in the Presidency, Mondli Gungubele, says South Africa’s potential in the production of green hydrogen can be catalytic for economic growth and job creation in the aftermath of COVID-19.
He was speaking during the green hydrogen stakeholder engagement at Port Nolloth in the Northern Cape – not too far from the envisioned Green Hydrogen Special Economic Zone at Boegoebaai.
Green hydrogen has been billed as the fuel of the future because of its low carbon emissions when in use and South Africa’s potential ability to produce vast amounts of it through renewable energy sources could place the country as a leading player in that market.
“South Africa can maximise the potential of green [hydrogen] by following a dual strategy entailing maximising the export potential of green [hydrogen] derivative products in the short-term and using green [hydrogen] as an enabler for domestic, industrial decarbonisation and attracting hard-to-abate industries to relocate to South Africa in the medium term. Both strategies would be underpinned by localisation,” Gungubele said.
The Minister highlighted that the country has key advantages in the green hydrogen market including:
A superior renewable energy endowment of both onshore wind and solar which are the largest cost component in the production of green hydrogen
Holding largest concentration of known platinum group metal reserves which are needed for the manufacturing of fuel cells
A deep expertise of the Fischer-Tropsch Process used to produce power fuels such as diesel, petrol and kerosene (jet fuel);
The availability of large tracts of relatively cheap land for renewable energy production;
A large electric grid for the wheeling of renewable energy; and
A large domestic industrial base as a source of local demand.
Gungubele said the global hydrogen export market to reach a potential worth of up to at least $300 billion per annum by 2050.
He explained that as a result, government is developing plans for the country to participate in the market.
“Over the past 12 months, Infrastructure South Africa (ISA) has been working with the Northern Cape and Gauteng Provincial Governments to develop catalytic green hydrogen projects that will underpin provincial green hyrdrogen strategies with the Northern Cape being the production hub and Gauteng being the domestic demand hub.
“These projects and strategies together with the [Department of Science and Innovation’s] Hydrogen Society Roadmap for South Africa will be the foundation of a national green hydrogen strategy,” the Minister said.
The two provincial governments have already signed three memoranda for the production of green hydrogen including:
The memorandum of agreement between the Northern Cape Provincial Government and Sasol; for Sasol to be the anchor developer of the planned Boegoebaai Green H2 SEZ
A memorandum of agreement between Northern Cape Provincial Government and the Port of Rotterdam (PoR) for the PoR to act as a demand aggregator for green hydrogen into Europe; and
A memorandum of agreement between the Gauteng Provincial Government and Sasol for Sasol to develop green hydrogen production facilities in Gauteng aimed at decarbonising domestic industry.
The Minister reiterated that as government continues its work to recover the economy, the development of green hydrogens remains a big frontier for the country.
“Green hydrogen is not only potentially catalytic for the Northern Cape but for South Africa as a whole. It represents a real reindustrialisation vector and a potential enabler of mineral beneficiation by coupling our mineral resource endowment with green energy,” he said.