We highlight the various costs to create, transport and ultimately use hydrogen as a fuel and recommend the National Hydrogen Taskforce conduct robust cost-benefit analyses in assessing the case for hydrogen. Further, we recommend approaches for cost-benefit analyses.
National Hydrogen Strategy issues papers
PIAC responded to the COAG Energy Council’s consultation on the National Hydrogen Strategy issue paper 6 – Hydrogen in the gas network.
We note that the issues paper focusses on the policy and technological barriers to the use of hydrogen in gas networks but does not discuss costs and who pays. We consider this a missed opportunity given the potentially large costs associated with a transition to hydrogen, and from forgoing an alternative energy path.
We note that household consumers will not be net beneficiaries of blending hydrogen in the gas network, and consequently consider it inappropriate that they should bear the costs and risks of it. In light of this, we recommend a payment framework for recovering costs and allocating risks.