Sometimes you’re so busy making explosives you don’t have time to stop and think, hey, maybe there’s a cheaper way to make explosives? That’s when a lightbulb moment from a visiting consultant can set you on a path to drastic industrial reform.

When the solution involves replacing reliance on natural gas with on-site solar, it also becomes a satisfying exercise in cancelling energy price volatility and gaining green credentials.

That’s what happened when Carbon Friendly Enterprises project director of renewable energy Zim Solo visited Dyno Nobel’s plant in Moranbah, Queensland, last year. The plant, owned by Incitec Pivot, relies on low-pressure coal-seam gas for all its electricity, via 21MW of gas generation, and as a raw material to make ammonia.

In the current process, methane is reformed into hydrogen – from CH4 to H2 – which involves splitting off the carbon molecule and forsaking half the hydrogen. Ammonia – NH3 – is then synthesised from hydrogen and nitrogen using the Haber process and enriched to supply explosives to the mining industry in the surrounding Bowen Basin and across Australia.

“This is where it gets a bit interesting,” says Solo. “The Haber process is a bit inefficient by its nature, but very cheap. It’s the cheapest way to make hydrogen.”

Solo wondered: was there a cheaper solution?

About 87% of the world’s hydrogen is made through methane reforming, but only 3% is “green” hydrogen produced via a renewable energy source. How about building enough solar PV generation to power the plant and create hydrogen using electrolysis?

The firm heard logic in Solo’s view and he was commissioned to begin a hydrogen-solar study. At first he started looking at a 20MW hydrogen plant, but with hydrogen, he says, the bigger you go the cheaper it gets. “The price of 1MW or 2MW as opposed to 10MW is not a lot of difference. But 10MW up to 100MW, the price reduction is exponential,” he says.

Hydrogen hedge

The study is looking at a 150-160MW hydrogen facility and a 210MW solar farm, all behind the meter. “There is absolutely an opportunity for hydrogen to ensure the resilience of the business,” says Solo, who estimates a six-year payback. Running on solar, the hydrogen plant would operate about 5.5 hours a day, with the possibility of hydrogen fuel storage to take up lags from intermittent weather.

The next stage of the study will explore the idea of connecting to the grid and sourcing 24-hour clean energy. “That would make it much more economically viable,” he says. “It may have more integrated renewable technologies, and that’s the way you gain aggregate efficiencies and can smooth out the [solar generation] bell curve and maintain production. It’s a production-driven site. It comes down to pure economics at the end of the day,” says Solo, who credits work by Incitec Pivot lead process engineer Mike Walters and Asia-Pacific environmental manager Matt Walker.

The economics of producing hydrogen for end use at Dyno Nobel are very different to storing it to try to retain electrons and then dispatching it to free electrons, where efficiencies are lost at both ends. Hydrogen conversion is only about 20% efficient.

“It’s not a very efficient process. But if you’re doing it for pure chemistry – in this case they need hydrogen to make ammonia – it stacks up and makes sense,” he says.

Projects like this one are a valuable testing ground, he says. “The demand for green hydrogen out of South Korea and Japan is massive.” Ammonia is one of the most efficient ways to store and ship hydrogen.

“Once we get up to 700% renewables, then we can start exporting hydrogen. Then we can make a hydrogen economy in Australia. It’s a massive sleeping giant of international trade and capability.”