South Africa may be on route to reducing both its high fossil fuel use and its unemployment rates with the help of eco-friendly hydrogen. Work on the country’s new and ambitious Hydrogen Valley Corridor project has begun to create a hydrogen economy. It is predicted that by 2030 the project will be producing 14,000 to 30,000 jobs a year, including mining jobs.
These jobs will include both direct and indirect positions.
Blade Nzimande, South Africa’s Minister of Higher Education, Science, and Innovation announced this earlier in June during his annual budget speech.
The Minister added that as well as creating jobs, the project could “potentially contribute $3.9 billion – $8.8 billion (R60.2 billion – R123 billion) to [South Africa’s] GDP through direct and indirect contributions.”
According to Nzimande, the total cost of implementing the various projects identified to begin the larger Hydrogen Valley project will amount to around $1.2 billion. There will be “nine catalytic projects across the mobility, industrial, and buildings sectors to kick-start the hydrogen economy”, he said.
The Hydrogen Valley will be situated across three centres of access to green hydrogen and high hydrogen demand: Johannesburg, Mogalakwena/Limpopo, and Durban/Richards Bay.
What is a hydrogen valley?
A Hydrogen Valley is an area in which an interconnected ecosystem of hydrogen-focused projects is formed. The area could be a large region, a town or city, or an industrial cluster.
The ‘ecosystem’ includes projects and players along the entire hydrogen value chain, from extraction, production, distribution, transport, storage, and end-use initiatives. Industries involved include industrial, infrastructural, mobility, and research sectors. Integrated together, these make up the larger Hydrogen Valley project and make it more cost-effective.
Around the globe, Hydrogen Valleys have begun to crop up, indicating that the hydrogen market is expanding and strengthening, and South Africa has jumped on board.
What to know about South Africa’s Hydrogen Valley project
It will create many diverse jobs
Job growth from this project is certain. According to a 2021 study on the project prior to its start, up to 32,000 jobs per year could be created by 2030, a number the study garnered from initial investments in the Hydrogen Valley project.
The study also stated that fuel cell investment may generate more jobs in addition to this.
As the Hydrogen Valley involves industries spanning the entire hydrogen value chain, there may be a growth in jobs in various sectors involved in the project.
Industries involved in every process and stage of the project, from mining and the sourcing of necessary resources to production, transport, storage, and the manufacturing of fuel cells, could see job expansion.
This presents a plethora of possible jobs to come South Africa’s way, from mining positions to training, R&D, transport management and operation, training, building jobs, and many more.
The platinum, diamond, copper, and titanium mining industries will likely also see job growth, as these are some of the key raw materials required for the Hydrogen Valley project.
How much it will cost South Africa
In order to build a truly lasting, substantial green hydrogen market and sector, South Africa will require $14 billion from investors, reported Bloomberg in May 2022.
Building the green hydrogen industry in the country and making it so it is capable of exporting 20,000 tonnes of hydrogen yearly would cost an initial $1 billion. On top of that, achieving a 270,000-tonne target yield would set South Africa back by a further $13 billion.
Currently, South Africa is negotiating an offer from the UK, US, France, and Germany for an $8.5-billion funding package. The powerful countries are investing to push a shift to clean energy in the country and reduce its reliance on coal.
Further investments from other foreign investors will also be needed.
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