Hydrogen based fuel cells are cleaner and more efficient than traditional power plants and internal combustion engines and can be used in cars and trucks just like batteries. Hydrogen fuel has the potential to become a vital complement to solar, wind and hydropower, along with batteries. NASA has used hydrogen as rocket fuel for decades. Hydrogen is already used for clean running city buses and in forklifts in warehouse buildings and is also used in the production of carbon steels, special metals and semiconductors. It’s a core component of ammonia for fertilizer and methanol for the production of polymers (nylon, Teflon, plastics).
Hydrogen can also be used as stored energy to balance the load when the electric grid is under strain or when intermittent sources like solar and wind slow down. Electric vehicles powered by lithium-ion batteries seem primed to displace gasoline-fueled cars in a clean transportation future, but the “mass penalty” EVs incur as their hauled weight increases (16,000 pounds of electric vehicle batteries versus 4,000 pounds of hydrogen fuel cell drive train), makes hydrogen fuel cells better candidates to replace the big diesel engines of long-haul heavy payload trucks.
Hydrogen doesn’t exist “in the wild” in large easily obtainable quantities so its atoms must be derived from compounds like methane (CH4) or water (H20). Ninety-five percent of the hydrogen produced in the US today is made through a process called steam reformation, where natural gas is heated to nearly 1000° C and reacted under pressure with steam and a catalyst to produce carbon monoxide (CO) and hydrogen [CH4 + H20 + heat à CO + 3H2]. It then undergoes a “water-gas shift” reaction that produces carbon dioxide and hydrogen [CO + 3H2 à CO2 + H2]. We get hydrogen but we also use a lot of fossil fuel energy in the process and release great quantities of carbon dioxide.
By contrast, producers of green hydrogen use renewable energy from wind, hydro or solar to produce hydrogen from water through a process called electrolysis. An electrical current splits water into its constituent parts to produce hydrogen and oxygen [H20 + electricity à H2 +O]. In effect, the resulting hydrogen can be thought of as stored solar or wind power. Other methods of producing green hydrogen include pulling the hydrogen atoms from waste, similar to the planned SHG2 project in Lancaster, California that will use plasma arc gasification technology to turn components of waste paper into pure hydrogen. Hydrogen made through renewables-based electrolysis is clean, transportable and releases zero carbon and is thus deemed “green” or “renewable hydrogen” (RH2).
Hydrogen’s low density and small molecule size makes it harder and more expensive to store and transport than fossil fuels. It also isn’t compatible with most existing pipelines so new infrastructure will have to be built. The cost to produce green hydrogen through electrolysis has dropped 40% in the last 5 years, but it is still much higher ($3.00-7.50/kg) than what it costs to make hydrogen from natural gas ($0.90-3.20/kg) through steam reformation. In order to drive costs down, large scale demand must be created so large production plants can be built to capture economies of scale. A 2020 McKinsey study for the Hydrogen counsel found that $70 billion of investment (5% of annual global spending on energy) over the next 10 years on hydrogen production could reduce costs 50% by 2030. If that happens, green hydrogen can be produced for $1-2/kg by 2030 which is equivalent to the cost to produce natural gas. This will likely require aggressive government mandates, subsidies and a tax on carbon to incentivize industries to make the switch.
The European Union is planning to run a major part of its economy on “green” hydrogen. By 2030, the EU is planning to install at least 40 gigawatts of renewable power and accompanying electrolyzers for the sole purpose to make huge volumes of hydrogen. To hit the Paris Climate Accords targets of limiting global temperature rise to 1.5° C by 2050, Bloomberg New Energy Finance estimates that we will need to shift 24% of our world’s energy demand with green hydrogen. The International Renewable Energy Agency estimates that the world will need 19 exajoules of green hydrogen in the energy system by 2050, which is close to 150 million tons per year. According to some estimates, this will require six times the amount of renewable energy capacity installed globally today dedicated solely to electrolyzers producing renewable hydrogen.
Virtually all of the current renewable capacity is dedicated to producing power for the grid, so the renewable energy capacity needed to produce the target amount of green hydrogen is immense. It will also have to be stored in salt caves and caverns or other suitable locations near demand centers in order to be readily available for use. One concept is to build dedicated hydrogen pipelines along industrial and heavy transportation corridors that can be connected to large scale renewable energy sources producing and storing renewable hydrogen. Other methods of storing and distributing hydrogen-based power include liquid organic hydrogen carriers (LOHCs), ammonia and liquid hydrogen.
Right now there are dozens of companies looking to become the next Tesla of green hydrogen, hoping to unlock its potential in the industrial, transportation, chemicals and power production sectors. In large-scale hydrogen production, the largest industrial gas companies (Air Liquide, Air Products, Linde) that have been producing “grey” hydrogen for years are beginning to produce green hydrogen. NEL, Siemens, Thyssen, Cummins/Hydrogenics and others are making the electrolyzer and associate equipment at scale to product RH2. Oil majors like BP, Total and Shell are working on hydrogen distribution networks. The state of California just awarded $40 million for 123 hydrogen fueling stations to be built by Shell, FirstElement and Iwatani of Japan. Hydrogen fuel cells are being produced by Ballard, Plug Power, Hyzon, Toyota and Daimler/Volvo.
“The technologies and financing strategies of clean hydrogen production combine a new set of skills to succeed, including understanding of renewable energy siting and production, electrolyzer technology, project financing for new technologies, and merchant market risk. While the existing players have some of these skills, they generally lack a combined level of expertise that would allow them to enter the clean hydrogen market quickly and serve all of the new non-traditional customers that are emerging in the new hydrogen economy. This calls for a fundamentally new type of producer and distributor of hydrogen gas.”
