According to Mr Blakiston, green hydrogen is going to play a significant role in Australia moving forward.

“The interesting thing for Australia is that we clearly have enormous amounts of green potential being sun and wind. And if you look at some of the maps that get produced showing the places in the world which are best suited for the production of green energy, the north of Australia is one of those,” he said.

“We have an incredible concentration of wind and solar, but then hydrogen can also be produced using other fuels. And there’s a whole rainbow of colours, Western Australia in particular, blue hydrogen is something that is very, very much in focus.

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“Not everyone agrees with the concept because you’re still using fossil fuel to generate hydrogen, but the gas industry will feed into the generation of hydrogen and produce what’s called blue hydrogen. Elsewhere in the world, we’ve the whole rainbow of colours. And Australia has the potential with uranium to produce a different coloured hydrogen as well from that.”

However, there a number of challenges when it comes to ensuring the hydrogen opportunities in Australia are economically viable, Mr Blakiston added.

“One of the challenges that we’re going to face with the generation of the required amount of green energy to produce hydrogen is if you go to solar, you need an extensive amount of landmass to do it. And people look north and say, ‘Well in Western Australia than in Northern Territory and in Queensland, there’s an enormous amount of unoccupied land. So, we can basically put solar panels on it.’ One of the challenges we’re going to have is that there’s actually other owners of that land, and that’s the Indigenous communities,” he explained.

“Western Australia tried to address this some years ago with a particular form of land tenure, and it ran into difficulties. So, they went and reconsidered the position and hence this recent legislation that’s been introduced is an upgrade of previous thinking. But we’ve still got the issue of our Indigenous communities. They want to have their rights respected, and they’re still trying to determine what it is that they’re prepared to have on their land. Because to get us viable business up, you’ve got to get rights to land for prolonged periods. And that of itself will create some challenges.”

These challenges are particularly important to note whilst a number of countries around the world are taking larger steps ahead within the hydrogen and clean energy space, argued Mr Marchesi.

“When you look around the world and internationally, you look to nations like the UK, the EU, the US, they’re a number of years ahead already. They’re not just talking about 2050 targets now, they’re talking about actionable 2030 pathways, and that’s where we need to get to as the nation,” he said.

“And we’ve done it before in Australia, when you looked at the development of the renewable energy industry around the RET scheme. A decade ago, those targets were set, and now, as I mentioned, wind and solar is the cheapest form of energy generation. So that’s the perfect model, and that’s something that we in Australia will need to do in order to enable the hydrogen deployment to scale up and to drive down the cost.”

In addition to the increased interest in green hydrogen, Mr Marchesi said that there has also been a greater demand across the country for carbon credits, which are used to offset carbon emissions.

“The carbon markets are set up in Australia to allow businesses to implement carbon abatement or reduction actions, which then result in carbon credits being issued. And so, you receive a carbon credit for each tonne of carbon dioxide that you reduce as a result of your project. Essentially those carbon credits then can be sold back to government, or they can be sold or traded on a secondary market,” he explained.

“So now we’re seeing much greater demand for carbon credits. Some of the really interesting developments around that, the clean energy regulators looking to set up an exchange, essentially, an online trading platform for carbon credits, something like the ASX, and they want that up and running by 2023.

“Another really interesting thing is around carbon credit financing. This is in very early stages. And currently, there [are] banks and financial institutions [that] have carbon trading desks. What they’re looking to do now is to expand that into financing, essentially providing financing on the back of these carbon credits. So upfront payment, they will receive the carbon credits of the life of the project. So, they will take the market risk in those carbon credits going forward, but carbon credits are only going one way in terms of value; it’s a smart investment for banks, and that’s going to be a huge area going forward.”

However, Australia has a lot of catching up to do in this space, concluded Mr Blakiston.

“We are actually a long way behind. We’ve had a number of changes of government brought about as a result of attitudes that certain leaders were taking in relation to carbon trading and the creation of carbon credits. The parties that sit behind those leaders weren’t supportive and that’s driven by the vested interests that various industry participants have. So, our governments have really grappled with the issue of carbon. We are a long way behind. What’s been challenging though for business is that the financers of businesses are now demanding that we take and pay attention to the role of carbon in the climate change,” he said.

“One of the challenges for any corporate is, are they an early mover or are they someone that follows on? And if you’ve got an incumbent business that has had significant capital invested, if you’re going to move towards changing how you do your business, you want clarity around what it means, not in one year or two years, but in the long term.”

The transcript of this podcast episode was slightly edited for publishing purposes. To listen to the full conversation with Michael Blakiston, Patrick Tydde and Christopher Marchesi, click below: