The main founders of the Inflation Reduction Act envision the US legislation as a clean energy bill to lower the costs of green energy technologies for everyone around the world as well as being emulated by especially those countries that have benefitted from emitting carbon into the air since the start of the Industrial Revolution.

Such countries could introduce their own versions of the Inflation Reduction Act to drive down prices even further for global benefit, US Department of State Bureau of Energy Resources Office of Energy Transformation acting director Scott Woodard told this week’s London Indaba.

“If you looked at estimates of what electrolysers to generate clean hydrogen were going to cost and how long it was going to take, it was a decade away and they were going to be expensive for a while.

“Now, estimates say that we could be seeing 10 GW electrolysers in the next two three years and clean hydrogen could be virtually zero cost,” Woodard said in response to London Indaba chairperson Bernard Swanepoel during question time.

Proton exchange membrane (PEM) electrolysers, which are regarded as being highly effective producers of zero-emission green hydrogen, are efficiently catalysed with the help of South Africa’s platinum group metals (PGMs), especially iridium. Electrolyser production is being brought down the cost curve significantly as China, with its robotics and automation, enters the era of machines making machines.

EVERY KILOGRAM OF GREEN HYDROGEN SUBSIDISED

The Inflation Reduction Act subsidises every kilogram of green hydrogen that is generated.

“That’s what I think we want people to really focus on when they look at the impact of this. Clearly, there are some trade issues that have popped up, but we have found as we’ve engaged with our partners, we have been able to shift the conversation somewhat from when the legislation first came out,” said Woodard.

“And hydrogen’s a good example because the green hydrogen value chain is not yet completely owned by a single country,” answered Swanepoel.

“The first thing to realise is that the Inflation Reduction Act is a huge piece of legislation, absolutely massive.

“You’ll see the headline number of $370-bilion but I’ve seen some private sector banks estimate that spending on this is actually going to be north of $1-trillion. Then you start thinking about how that will attract private sector investment and be even bigger,” the US diplomat predicted.

At the previous week’s FT Hydrogen Conference, Fortescue Future Industries and Fortescue Metals Group executive chairperson and founder Dr Andrew Forrest ascribed the success of Inflation Reduction Act to its absence of complexity: “It’s working because it’s simple. If you want to serve up something complex to a banker, you’re not going to get any money,” said Forrest, who expressed the view that the economies of countries could be significantly boosted for decades to come by adopting the US legislation as a model.

Meanwhile, important new technologies are being perfected that could give green hydrogen a globally traded commodity. An example of this is the work being done by German company Hydrogenious on liquid organic hydrogen carrier (LOHC) technology. LOHC technology enables hydrogen to be chemically bound to a thermal oil for storage and bulk shipping, leveraging the existing infrastructure for liquid fuels. That means that green hydrogen could in future be transported, stored and delivered in existing oil and gas infrastructure, and be traded globally in the same way as oil and gas.

PRESSURE BEING TAKEN OFF IRIDIUM SCARCITY

When it comes to PEM electrolysers, pressure is being taken off their need for scarce iridium. German PGM products and services company Heraeus Precious Metals, for example, is having major success in the thrifting of iridium and is also investing €35-million in the expansion of its PGM recycling capacity at Hanau in Germany, with the build-out forming part of a €300-million global recycling pr...