A recently published report released by South Africa’s Department of Science, Technology and Innovation, Anglo American, Bambili Energy, Engie and the SA National Energy Development Institute predicts that South Africa could potentially add between $3.9bn and $8.8bn to the country’s GDP, by 2050 through establishing a hydrogen economy.
The report further outlines that a hydrogen economy could create between 14,000 to 30,000+ direct and indirect jobs per year.
To realise this goal, South Africa’s Department of Science, Technology and Innovation (DSTI), in partnership with Anglo-American, Bambili Energy and ENGIE are looking into opportunities to transform the Bushveld complex and larger region around Johannesburg, Mogalakwena and Durban into a “Hydrogen Valley”.
The parties say the ‘Hydrogen Valley’, “can be leveraged to kickstart the hydrogen economy, leading to cost savings through shared infrastructure investments, improving the cost competitiveness of H2 production through economies of scale, enabling a rapid ramp-up of H2 production within a given territory, and leveraging an incubator for new pilot H2 project.”
Three catalytic green hydrogen hubs have been identified in the “Hydrogen Valley” – these include the Johannesburg hub (with spokes extending to Rustenburg and Pretoria); Durban hub, compassing both Durban and Richards Bay, and a third hub encompassing Mogalakwena and Limpopo.
Hydrogen price & pilot projects
The report estimates that by 2030, the levelized cost of hydrogen (LCOH) for green hydrogen production is expected to be $4 per kilogram across the hubs. This is still considered expensive in comparison with the projected price for gray H2 at $3 per kilogram. A further reduction in prices is predicted from 2030 onwards, presuming the cost of electrolysers would have declined.
The report has identified nine promising pilot projects to kickstart the Hydrogen Valley in the mobility (mining trucks, buses), industrial (ammonia/chemicals) and buildings (fuel cell power) sectors. In the mobility sector, there is already momentum in place to deploy mining trucks (e.g., project Rhyno in Mogalakwena) and heavy-duty trucks along the N3 corridor. There are also plans to pilot mobility applications in the Durban and Richards Bay port environment (e.g., forklifts), public buses and metropoles and berthing activities in the port of Durban powered by fuel cells.
In the buildings sector, the Limpopo Science and Technology Park, as well as Anglo-American corporate office buildings in Rustenburg, have already planned to install fuel cells for power. Other pilot opportunities have been identified in the field of public office buildings in metropoles and airport buildings at OR Tambo & King Shaka airports.