This article first appeared in Digital Edge, The Edge Malaysia Weekly on November 1, 2021 - November 7, 2021
Malaysia began exploring the use of hydrogen as an alternative fuel source for the energy sector in the 1990s, with at least two road maps or blueprints introduced along the way.
Progress on the implementation, however, was sluggish. Key targets, such as the installation of hydrogen refuelling stations by 2015, were not achieved, according to a 2019 review of Malaysia’s hydrogen economy by researchers from Universiti Teknologi Malaysia (UTM).
There were many reasons the plan did not take off then. One major hurdle was the gargantuan task of developing large-scale supporting infrastructure for hydrogen.
But in recent years, hydrogen is increasingly being considered globally as a potential fuel of the future to decarbonise the energy sector (see “What’s the deal with hydrogen?”). It is seen as a cleaner resource because when hydrogen is burnt to generate energy, it only forms water, unlike fossil fuels, which emit harmful greenhouse gases (GHG).
In Malaysia, Sarawak Energy Bhd launched Southeast Asia’s first integrated hydrogen production plant and refuelling station in 2019. Sarawak’s three buses that use hydrogen fuel cells began servicing routes in 2020.
Meanwhile, Petroliam Nasional Bhd (Petronas) has struck up partnerships with universities and private companies to explore the generation of hydrogen. Universiti Kebangsaan Malaysia and UTM have various ongoing hydrogen-related research projects.
Now, NanoMalaysia Bhd CEO Dr Rezal Khairi Ahmad wants to take up the challenge and create a new Malaysian hydrogen technology economy road map. He wants to unite the efforts of all the players in the country, quantify the potential economic impact of this industry and drive innovation in hydrogen-related technologies.
NanoMalaysia is a company limited by guarantee under the Ministry of Science, Technology and Innovation (Mosti). It is entrusted with nanotechnology commercialisation activities.
Things are different now, Rezal believes. Globally, companies and governments are vying to use hydrogen as a strategy to reduce carbon emissions and reach net zero emission goals. Oil and gas companies, under immense pressure to decarbonise, are diversifying into blue hydrogen.
“The EU announced its Hydrogen Strategy last year, Japan renewed its commitment to hydrogen energy, while South Korea and Australia announced multimillion-dollar investments in the hydrogen industry,” Rezal points out.
“BP, Shell and ExxonMobil are undergoing this transition. This is unprecedented. That’s why I have confidence that it will be different this time, as the market forces and technology development provide evidence that hydrogen is here to stay. We need to ride the wave and ensure Malaysia can participate and, at least, become a leader for it in the region.”
The Malaysian government identified hydrogen fuel cells as a priority research area in 2001. From 1997 to 2013, RM40 million worth of R&D funds were allocated to this. A hydrogen road map was formulated in 2006 and a blueprint for fuel cell industries in Malaysia was published in 2017.
According to these plans, the country was expected to have advanced hydrogen storage technology, 100 buses that use fuel cells and hydrogen infrastructure developed for the global market by 2020, among other things.
“Execution has always been a sore point in terms of our blueprints and road maps in Malaysia. But we think we are different this time,” says Rezal.
He adds that Mosti, the Ministry of Environment and Water and the Economic Planning Unit are very supportive of this new national hydrogen technology economy road map.
Rezal’s confidence stems from NanoMalaysia’s record in launching the National Graphene Action Plan (NGAP) in 2014 and its venture-building approach. Graphene is a carbon-based nanomaterial that is strong, light and electrically and thermally conductive. It can be used in various industries, including to create next-generation electronics.
NanoMalaysia has co-developed several technologies with local companies and universities. According to its 2020 strategic report, it has completed 30 projects since 2016 and has 23 ongoing projects under the NGAP. In 2020, four products were commercialised under this programme.
For instance, it assisted Penchem Technologies Sdn Bhd in developing graphene-based conductive inks for flexible circuits and worked with MNA Research Sdn Bhd to create graphene-based quantum cells for energy storage.
The technologies developed were wholly-owned by NanoMalaysia from 2019, with the partners given first right of refusal for commercialisation. Prior to this, the intellectual property (IP) was co-owned.
“This is meant to drive a different entrepreneurial mindset and create a safety net for our investment in potential technologies. This is part of our venture-builder investment model,” says Rezal.
NanoMalaysia’s approach to innovation is for stakeholders to assist innovators along the way, from prototyping and product development to commercialisation.
“The whole idea is to build the future by design, not by chance. In the past, governments or universities tended to create a programme, put some money into it and allow the private sector to come in randomly. The value chain cannot be orchestrated that way,” he says.
“For high tech, there are a lot of hoops you have to go through because of regulations, testing, safety certifications and so on. Hence, we have no choice but to be involved in these processes to ensure the innovations can enter the market.”
NanoMalaysia also has its own investments in hydrogen technology. In 2016, it began working with Pulsar UAV Sdn Bhd, which has developed drones powered by fuel cells that generate hydrogen on the spot using advanced materials.
“The drone is able to fly four times longer than conventional drones powered by batteries. We’ve deployed it for geo-mapping at oil plantations,” says Rezal.
Last year, NanoMalaysia launched the Hydrogen Paired Electric Racer project, which aggregates the technologies developed by Pulsar UAV and MNA Energy.
With a foot in the game, it could be said that NanoMalaysia understands the dynamics of the industry and can identify where the gaps and synergies are. But could there also be a conflict of interest?
Rezal does not think so. The solid-state hydrogen technology developed with Pulsar UAV complements hydrogen players in the country, which are focusing on more traditional hydrogen production methods, he says.
“The road map is a collaborative effort with the Malaysian Green Technology and Climate Change Centre, Mosti’s National Nanotechnology Centre and the Academy of Sciences Malaysia, which provides the checks and balances,” he says.
Focus group discussions have been held with players in the industry, including Sarawak Energy, Petronas, Tenaga Nasional Bhd, UMW Holdings Bhd and the Malaysian Association of Hydrogen Energy, as well as various ministries and agencies. These companies could become the future suppliers and off-takers of hydrogen.
NanoMalaysia has been given the mandate by Mosti to conduct a study for the Malaysian hydrogen technology economy road map, which will be concluded in November.
National energy storage initiative
Apart from the hydrogen technology economy road map, another national initiative that Dr Rezal Khairi Ahmad, CEO of NanoMalaysia, is working on is the national energy storage initiative.
This is driven by his conviction that batteries will drive the transformation in the transport sector going forward, owing to the proliferation of electric vehicles (EVs). At the same time, while Malaysia is lagging behind in building its own EVs, it could instead focus on manufacturing high-tech batteries for EVs.
“The most expensive component of an EV is the battery. Since 2018, NanoMalaysia has started investing in a number of battery technologies. We knew that there would be a huge opportunity in the market,” says Rezal.
“We invested in an energy storage technology called graphene-enhanced lithium-ion battery that can improve energy density, thus increasing the EV driving range and battery life. The project was the result of a collaboration with a local company and a university.”
The idea is that Malaysia doesn’t have to compete with the big EV or even battery makers globally, especially as the country does not have the requisite raw materials like lithium. Instead, it can innovate on battery technologies.
“We are focusing more on the electrodes. This technology is developed from our National Graphene Action Plan. A typical electrode has graphite but it’s bulkier. We use graphene, which is more refined and hence, able to store more charge per unit area. Consequently, we can improve the energy density and durability,” says Rezal.
“Our first prototype battery’s energy density is comparable with that of Tesla’s battery late last year. We are continually closing the gap in terms of performance.”
NanoMalaysia co-owns the intellectual property for this technology with a local company called ASP Pro Sdn Bhd, which is pivoting away from selling handphone accessories and car battery jump-starters.
Batteries can also be used as storage for renewable energy generation. There is demand for such an innovation. The Energy Commission, for instance, has stated its plan to install utility-scale batteries in the Peninsular Malaysia grid by 2030 to allow for more renewable energy generation.
“We also co-developed a battery management system, so we are able to know exactly how the power is being used. We utilise the Internet of Things to monitor and manage the batteries remotely,” says Rezal.
With this initiative, he hopes to unite all the different players in this sector, identify the key economic metrics they can achieve with this innovation and attempt to make such batteries affordable.
What’s the deal with hydrogen?
Hydrogen is light, storable, energy-dense and, when burnt, produces no direct greenhouse gas (GHG) emissions, according to the International Energy Agency (IEA). That is why it has become a popular potential alternative fuel to power electricity and vehicles.
But there are diverse methods of hydrogen production, and this is why using hydrogen as a fuel source has drawn criticism.
The most common method of producing hydrogen currently is to extract it from fossil fuels. This is referred to as grey hydrogen. It is not a preferred option because carbon dioxide is released in the process and it relies on a non-renewable, carbon-intensive energy resource.
If a carbon capture, usage and storage (CCUS) technology is employed, the resulting product is called blue hydrogen. The downside of this method is that CCUS is costly and it still relies on fossil fuels.
The most desirable form is green hydrogen, where renewable energy is used to split water into hydrogen and oxygen. However, only 4% of hydrogen production globally uses this method, according to a review by researchers from Universiti Teknologi Malaysia. Biomass can also be a renewable resource to produce hydrogen. Again, cost and the availability of renewable energy and biomass feedstock have been identified as challenges.
Hydrogen is mainly used as a raw material in the chemical industries, most of which are using grey hydrogen. Transitioning to green hydrogen, therefore, allows these industries to reduce emissions.
Hydrogen could also play a huge role to support the transition to clean energy for the transport sector and in electricity generation. Of course, this will have to be in the form of green hydrogen to fully reap the benefits of decarbonisation.
Unfortunately, grey hydrogen is still the primary source currently, and it is responsible for 830 million tonnes of carbon dioxide emissions a year, according to the IEA, which is equivalent to that of the UK and Indonesia combined.
Japan is a major importer of hydrogen as it sees hydrogen as a crucial way to decarbonise its economy and it wants to position itself as a fuel cell technology exporter. Automotive companies such as Toyota, Honda and Hyundai have all developed vehicles that use hydrogen fuel cells.
These vehicles are said to have faster charging times than battery-powered electric vehicles (EVs) and a longer range. In a country where the electricity grid is still primarily powered by fossil fuels, a vehicle that uses a hydrogen fuel cell could be more sustainable if it uses green hydrogen. But it is still generally more expensive than regular EVs and there are fewer charging stations available.
What can Malaysia do?
According to Dr Rezal Khairi Ahmad, CEO of NanoMalaysia, the most viable use for hydrogen in Malaysia is in transport, either in vehicles that use hydrogen fuel cells or direct combustion of hydrogen in the internal combustion engine of a vehicle.
Both methods result in less carbon emissions than a conventional fossil fuel-powered vehicle. But the high cost is a hurdle. To ensure that hydrogen is truly a more sustainable alternative, blue or green hydrogen will have to be used, and both are expensive.
“Going from grey to blue hydrogen translates into a higher cost of hydrogen. It’s roughly US$3 per kg to install the CCUS. Of course, we can target the export market. Japan is already importing grey hydrogen from Brunei. We can offer them blue hydrogen that is price-competitive and environmentally friendlier,” says Rezal.
Green hydrogen is currently priced at around US$6 per kg, he adds. The global goal is to reach US$1 per kg by 2050, but he believes this can be done earlier through the use of advanced materials. Leveraging excess renewable energy is another strategy.
“Sarawak has shown that by leveraging excess electricity generated from the Bakun hydroelectric dam, it is already close to that target,” says Rezal. He estimates that it is around US$2.4 per kg currently.
Large-scale hydropower was not considered a renewable energy source under the Pakatan Harapan government due to the global debate around its sustainability, according to former minister of energy, science, technology, environment and climate change Yeo Bee Yin. The current government considers it a renewable energy source.
Rezal agrees with the latter. “The environmental impact is only for one time and the carbon footprint is zero. It has been acknowledged around the world as a clean energy. If you think about it, solar power is also dirty because you need fossil fuels to manufacture the panels.”
The excess energy could also be drawn from solar energy generated by the many Large Scale Solar projects in the country, Rezal notes. “When they are unable to supply electricity to the grid, we can reroute the excess energy to produce hydrogen. That’s what Australia is doing.”
This also addresses the intermittency problem of solar power generation without battery storage, which is currently expensive. The excess energy can be used to produce hydrogen, which can be stored.
Another source is from biomass, given that Malaysia has tons of organic waste from oil palm plantations. NanoMalaysia is already working with a start-up that can convert biomass into hydrogen, with carbon nanomaterial graphene as the by-product.
“Since we are addressing two supply chains, we are able to reach a lower cost of production,” says Rezal.
Can Malaysia do it?
It is already difficult to promote battery-powered EVs in Malaysia and ensure there is enough charging infrastructure. At the same time, the government is trying hard to encourage more generation of renewable energy.
Would introducing the hydrogen road map divert resources away from the big task of decarbonising the power sector? Is there enough local demand?
Rezal believes it can work. There is currently a huge export market for hydrogen, and hydrogen can complement the energy transition.
“My passion for EVs was the primary reason I embarked on this road map. We started orchestrating EV-related projects from 2014, when the National Automotive Policy (NAP) wasn’t even spoken of yet. And now, as we wait for more clarity from the NAP on next-generation vehicles, I want to advance the tech development,” he says.
Batteries are heavy and can be used only in vehicles. Drones and airplanes would benefit from using hydrogen fuel cells as they are lighter, says Rezal. This weight advantage and faster refuelling time bodes well for the future of hydrogen.
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