Last week I poured cold H2O on the prospects of hydrogen becoming a good business because it costs $7 to 10 per kilogram to make and the selling price needs to be $2 per kg to be viable, so how could anyone make money?

But then on Tuesday, a press release hit my inbox from an ASX-listed company called Pure Hydrogen (ASX:PH2). The headline said: “Pure Hydrogen leases a 4000-square-metre site in Queensland for its first demonstration Hydrogen Micro-Hub.”

Someone obviously reckons they can make money making hydrogen, so I rang the CEO of Pure Hydrogen, Scott Brown, to get the lowdown.

“What’s the business model?” I asked. He confirmed that, as discussed, the cost of producing “green hydrogen” by separating the oxygen and hydrogen in water with electrolysis using renewable grid electricity is $7 to 10 per kg.

But he says he can sell it for at least $20/kg for transport use, which would give a profit margin of more than 50 per cent. He says the $2 price refers to using hydrogen to generate electricity, competing against solar and wind, which definitely won’t work and he’s not doing that.

“Who will your customers be?” I pressed. Well, the land Pure Hydrogen will rent for its demonstration hydrogen factory is at Archerfield Airport, 11 kilometres from Brisbane CBD, from where, Scott Brown says, a lot of hydrogen-powered drones are taking off, and they’re currently paying $30 a kg for their hydrogen. He’ll start with them.

“Really?” I said, picturing the air around Rocklea and Acacia Ridge thick with buzzing hydrogen-powered drones. “Drones taking off from Archerfield Airport? What are they doing?” Surveys and stuff,........

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