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Business

Asian firms eye hydrogen for clean energy

Danessa Rivera - The Philippine Star

MANILA, Philippines — Asian countries are seen turning to hydrogen to contribute to their long-term clean energy targets, as gas and liquefied natural gas (LNG) power developments are expected to cool down by 2035, according to a report.

In the recently published Black & Veatch 2022 Asia Electric Report, author and Black & Veatch associate vice president for management consulting business in Asia Harry Harji said there is short-term confidence in gas power developments, but the medium-term outlook is uncertain.

The report said there is a robust pipeline of gas-fired and LNG power plant developments in the next five years.

“Driving gas-plant prospects across Southeast Asia is the desire to reduce reliance on coal while meeting growing power demand; something intermittent renewables alone cannot achieve,” Harji said.

Citing an analysis by Bloomberg New Energy Finance (BNEF), Asian government plans are lining up 37 gigawatts (GW) of new gas-fired capacity in the next decade.

“BNEF also forecasts that Indonesia, Malaysia, Philippines, Thailand, Vietnam and Taiwan are expected to grow LNG import capacity in the first half of the 2020s, to help fuel more than 25 GW of proposed LNG-to-power projects,” Harji said.

Currently, the Philippines has nearly 3,500 megawatts (MW) of gas-fired power plants that supplies 30 to 40 percent of Luzon’s energy requirement, and about 20 percent of the country’s power needs.

The plants get their fuel from the Malampaya deep-water gas-to-power project, the country’s largest gas development to-date and is currently the only local producer of indigenous natural gas.

Service Contract (SC) 38, the license that allows the exploration of the Malampaya gas field in northwest Palawan, will expire in 2024. Moreover, gas supply from the project is expected to be depleted as early as this year.

To resolve the Malampaya supply issue and its contract’s expiry in 2024, the DOE has charted a vision of making the Philippines a LNG trading and trans-shipment hub in Asia-Pacific and placing the country as an LNG distributor and exporter as well.

So far, the Philippine government has cleared the development of six proposed LNG terminals to import the fuel needed by existing and future gas-fired power plants.

The Department of Energy (DOE) aims to have a 13 million tons LNG per annum (MTPA) LNG capacity in the long run and for the Philippines to be the leading LNG hub of Asia.

However, the latest Black & Veatch report said there is less optimism about the role of gas-fired generation beyond 2035.

“In 2021, nearly one in two respondents see gas’ role falling beyond 2035, compared to about two out of three who responded in 2020. And it is anticipated that the gas investments that go ahead will become increasingly focused on upgrading existing facilities,” Harji said.

The report showed strong belief in hydrogen’s potential to take off as an affordable alternative to existing gas generation, which is seen happening by 2030.

“It seems likely that full or partial fuel conversion to hydrogen will figure significantly in the upgrades,” Harji said.

The report said hydrogen can be used as an exportable, seasonal energy storage method to respond to the variability of wind and solar, and as a fuel for existing gas turbine facilities.

LNG

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