First Gas eyes national energy centre for hydrogen pipeline trial

Prime Minister Jacinda Ardern today said the government will spend $27 million to establish the new energy centre in New Plymouth. Photo / File

First Gas says a hydrogen pipeline trial it plans is likely to be among the first projects undertaken at the National New Energy Development Centre being set up in Taranaki.

The company, which operates the trunk gas transmission network in the North Island, plans to select part of a pipeline network to test a range of assets on various blends of hydrogen gas, the best sources of hydrogen for those locations, and how to measure and meter energy flows.

"Hydrogen is emissions-free at the point of use," chief executive Paul Goodeve says. "Trials are starting up all over the world and must start here in New Zealand if we are to have all options on the table to achieve our zero-emission targets.

"The trial is intensely practical: we need to work out what we need to modify on our network to transport the gas, and what adaptations users may need to make to machinery and practices."

Prime Minister Jacinda Ardern today said the government will spend $27 million to establish the new energy centre in New Plymouth as part of a strategy to help Taranaki's long-term transition away from oil and gas. A further $20m will be available over four years for research into "cutting edge" such as organic photovoltaics, superconductors and nanotechnologies.

Hydrogen is being investigated worldwide as a low-carbon transport fuel, as an alternative to natural gas in industrial processing or domestic heating, or simply to reduce the emissions impact of existing piped gas services.

But the economics are challenging, whether it is made from renewable electricity, or from natural gas with the resulting CO2 then sequestered. New Zealand's highly renewable electricity system may tend to push the use of hydrogen into niche freight and heavy transport applications, Concept Consulting said in study published in February.

First Gas, based in New Plymouth, is the country's third-largest residential pipeline operator after Powerco and Vector. It also owns the Rockgas LPG business and the Ahuroa gas storage facility near Stratford.

"Transitioning to emissions-free energy poses tough technical and real-world challenges, and Taranaki holds the bulk of New Zealand's expertise to do this," Goodeve said. "Our project team will collaborate with others at the centre to develop solutions that work in the future energy sector."

Commercial and regulatory general manager Ben Gerritsen said the firm is keeping abreast of a range of similar studies being carried out in the US, Australia and the UK.

But he said it is important to test hydrogen's potential in the local market and within the industry's regulatory arrangements.

The timetable for establishing the new centre is unclear. In the meantime, Gerritsen said the firm will press ahead with the first stage of its work.

Feasibility assessment and pipeline selection will establish a work programme to tool-up a section of the network so that it can transport hydrogen to participating end-users. That initial work should be wrapped up by the end of next year, Gerritsen said.

Hydrogen is already made from gas in Taranaki, but First Gas says local expertise and technology could provide a dedicated source using wind or other renewable electricity to power an electrolyser that splits water into hydrogen and oxygen.