Sasol and the Industrial Development Corporation (IDC) have signed a memorandum of understanding to collaborate on developing and shaping an enabling environment for South Africa’s green hydrogen economy. Picture: Dimpho Maja/African News Agency(ANA)
Sasol and the Industrial Development Corporation (IDC) have signed a memorandum of understanding to collaborate on developing and shaping an enabling environment for South Africa’s green hydrogen economy. Picture: Dimpho Maja/African News Agency(ANA)

Sasol, IDC deal to develop hydrogen economy in SA

By Banele Ginindza Time of article published Jul 6, 2021

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PETROCHEMICALS giant Sasol and the Industrial Development Corporation (IDC) have signed a memorandum of understanding to collaborate on developing and shaping an enabling environment for South Africa’s green hydrogen economy.

In a statement yesterday, the parties said the agreement was based on the mutual recognition that South Africa was well placed to harness its world-class renewable energy endowment and infrastructure, as well as Sasol’s Fischer-Tropsch technology and capabilities, to position the country as a worldwide leader in the hydrogen economy.

Sasol and the IDC would collaborate on a non-exclusive basis to advocate for policy frameworks that enable a hydrogen economy, develop pilot and bring to commercial scale hydrogen projects to pioneer viable and sustainable solutions, access local and international financing options, and pursue strategic projects that benefit the country’s energy transit system.

Priscillah Mabelane, Sasol’s executive vice-president: energy business, said: “Green hydrogen provides an exciting opportunity for the country to create new hydrogen ecosystems and become a credible exporter of sustainable energy and chemical products, such as hydrogen, ammonia and sustainable aviation fuel, while increasing much-needed employment opportunities.”

Mabelane said Sasol intended to be at the forefront of creating South Africa’s hydrogen ecosystems through strategic partnerships, leveraging proprietary technology and an integrated value chain.

“We are delighted to partner with the IDC in jointly pursuing South Africa’s green hydrogen potential to support a just energy transition and unlock new value chains to ignite the country’s economy,” Mabelane said.

Sasol is under pressure to reduce its carbon footprint and has a roadmap to reduce greenhouse gas emissions in South Africa by at least 10 percent by 2030 – working off a 2017 baseline.

Sasol and vehicle manufacturer Toyota South Africa earlier this year signed a deal to develop a pilot project for the development of hydrogen-powered heavy-duty long-haul trucks as part of an ambitious plan to explore the development of a South African green hydrogen eco-mobility system.

The IDC said yesterday the development of the hydrogen industry was a key enabler in South Africa’s just transition to a decarbonised future, which had the potential to decarbonise various industrial sectors.

Joanne Bate, the IDC’s chief operations officer, said: “The IDC intends on getting involved in the development of those catalytic projects needed to develop this new industry. We are looking forward to working together with Sasol in identifying and co-developing such catalytic projects. Our involvement in the development of the hydrogen industry also provides opportunities to fulfil our development mandate, which entails job creation and opportunities to involve previously disadvantaged entities.”

The PricewaterhouseCoopers (PwC) report titled “Unlocking South Africa’s hydrogen potential” released last year found that opportunities existed for South Africa to couple renewable generation with hydrogen production through electrolysis. The report said an investment in electrolysis technology would support the platinum sector and downstream beneficiation.

PwC experts said the infrastructure needed to export hydrogen was similar to existing natural gas networks and was already being piloted in Australia and Japan. “South Africa could leverage its existing port infrastructure to support this initiative and, in doing so, protect the jobs and infrastructure that are declining as a result of the drop in the global demand for coal exports,” said the report.

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