The South African government has taken another step in the future energy security direction with a commitment to cooperate with Germany on green hydrogen projects.
Minister in the Presidency responsible for Electricity, Dr Kgosientsho Ramokgopa, and German Vice Chancellor and Minister of Economic Affairs and Climate Action, Robert Habeck yesterday signed a joint declaration of intent to establish the South African-German Hydrogen Task Force.
The signing took place virtually during a Bi-National Commission between South Africa and Germany.
Green hydrogen, which is made by splitting water using renewable energy, is one of three ways South Africa is aiming to shift its economy away from a reliance on coal, which accounts for more than 80% of its electricity generation.
The Joint Declaration of Intent is not legally binding nor does it have financial implications for South Africa, its sole purpose is to create a South African-German Hydrogen Task Force within the framework of the South African-German Energy Partnership.
Masopha Moshoeshoe, a green economy specialist in the Presidency’s investment and infrastructure office, said South Africa had a pipeline of more than R300 billion of projects at different stages of development.
“Many of them are at a pre-feasibility stage, others advancing to feasibility, and those elements require funding. These projects are also aimed partly at the domestic market, but also at supplying hydrogen to produce green products for international markets and an important element of this joint declaration of intent to assist in creating,” Moshoeshoe said.
“There are a number of countries in different parts of the world that have the ability to produce green hydrogen at internationally cost-competitive prices. And there are specific markets in the world that will not be able to meet their own green hydrogen demand because of factors like not enough renewable energy and not enough lines to be able to produce it and other such factors.
“So there’s this linkage between those that have the ability to produce and those that have the demands. Some of the key demand markets are Germany, if we look, let’s say, within the European context, or Germany as well as the Netherlands. The Netherlands through the port of Rotterdam already imports about 13% of Europe's energy requirements.”
The key outputs of the declaration are the creation of the task force which will look at how the green hydrogen market will be created, how it will develop and grow.
The cooperation between the two countries aims to link South African developers in the green hydrogen market with off-takers in Germany.
This will also look at additional funding for projects and cooperation in creating projects in South Africa that are commercially viable that can meet international green hydrogen demand and supply.
The green hydrogen economy has been billed as a new frontier for clean energy as it emits low carbon emissions with a global potential of about $300 billion (R5 trillion) in exports.
South Africa holds approximately 80% of the world’s platinum group metals and 40% of the world’s platinum and palladium supplies which are key components in the production of hydrogen.
This makes South Africa potentially a key player in the future of the market.
Business to business opportunities between South African companies and their German counterparts will also be created through the task force.
The government has already drawn up plans for a Hydrogen Valley, which is expected to run from Limpopo, through Johannesburg to Durban.
The valley will establish opportunities for projects which will kick-start hydrogen initiatives in hubs with the aim of boosting economic growth and job creation.
BUSINESS REPORT