The Orkney Islands off the Scotland’s northern coast are often referred to as the “Hydrogen Islands”. This small collection of islands has led the way in developing a green hydrogen industry. But another set of Islands over 11,300 miles away could in time take that title.
New Zealand has excellent offshore wind resources, particularly off the coast of the South Island. An abundance of clean energy from hydropower, geothermal and onshore wind has meant offshore wind has not yet been considered much. Cost reduction in offshore wind has started to make a more interesting case for offshore wind.
In 2019, New Zealand consumed 40TWh of electricity, 16% of total primary energy use in the country. This means that just a handful of offshore wind farms would supply enough offshore wind in a balanced electricity system – using nothing like the technical offshore wind resource potential that it has.
The biggest opportunity for New Zealand is supporting global, rather than just national, decarbonisation. New Zealand’s technical offshore wind resource potential is many times that needed for domestic demand. It does have a big challenge in becoming an exporter of renewable energy, however – its isolation. As shown below, an interconnector to its nearest neighbour, Australia, would be at least three times longer than the Viking Link , which will be the world’s longest subsea interconnector when completed. Australia will also likely be a net exporter, too.
To become an exporter of renewable energy, New Zealand must seek alternative energy transportation methods. Using its offshore wind resources to produce hydrogen for transport via tanker vessels is one possible solution. Producing hydrogen opens export markets way beyond its nearest neighbour. Many countries, including several in the Asia Pacific region are pursuing transitions to renewable hydrogen-based economies – I’ll be discussing this more in a future blog. New Zealand wind resources and location mean it is well placed to a be key player in future hydrogen markets. It also seems to have a supportive domestic political environment. If it succeeds, New Zealand may well thank the first “Hydrogen Islands” for helping to set its course.