Page 28 - Energize June 2021

VIEWS AND OPINION

Admittedly, hydrogen is far from Agency (IEA) put the cost of green hydrogen at $3 to $7,50/kg, compared to $0,90 to $3,20 for
ideal as a fuel. Its low density makes it production using steam methane reformation.
hard to store and move around. And Cutting the cost of electrolysers will be critical to reducing the price of green hydrogen, but
its flammability can be a problem, as a that will take time and scale. Electrolyser costs could fall by half by 2040, from around $840/kW
Norwegian hydrogen filling station blast of capacity today, the IEA said last year.
highlighted in June 2019. The business case for green hydrogen requires very large amounts of cheap
But other low-carbon fuels have renewable electricity because a fair amount is lost in electrolysis. Electrolyser efficiencies
problems too, not least of which is cost. And range from around 60 to 80%, according to Shell. The efficiency challenge is exacerbated
since most of them require the production of by the fact that many applications may require green hydrogen to power a fuel cell,
green hydrogen as a precursor, why not just leading to further losses.
stick with the original product? Some observers have theorised that green hydrogen production might mop up excess
Proponents point out that hydrogen renewable energy capacity from big production centres, like Europe’s offshore wind farms.
is already widely used by industry, Given the still-high cost of electrolysers, though, it’s questionable whether green hydrogen
so technical problems relating to project developers would be willing to let their electrolysers sit idle until renewable energy
storage and transport are not likely prices drop below a certain level.
to be insurmountable. Plus, the gas is More likely, as is already being considered by Lightsource BP and Shell, developers will build
potentially very versatile, with possible green hydrogen production plants with dedicated renewable energy generation assets in high-
applications in areas ranging from resource locations.
heating and long-term energy storage to
transportation. How much green hydrogen is being produced?
The opportunity for green hydrogen Not much, in the grand scheme of things. Green hydrogen currently accounts for less than 1
to be applied across a wide range of percent of total annual hydrogen production, according to Wood Mackenzie.
sectors means there is a correspondingly But Wood Mackenzie forecasts output booming in the coming years. The pipeline of green
large number of companies that could hydrogen electrolyser projects nearly tripled in the five months leading up to April 2020, to
benefit from a burgeoning hydrogen fuel 8,2 GW. The surge was mainly driven by an increase in large-scale electrolyser deployments,
economy. Of these, perhaps the most with 17 projects scheduled to have 100 MW or more of capacity. And it’s not simply the case
significant are the oil and gas firms that that more projects are getting developed. By 2027, the average size of electrolyser systems will
are increasingly facing calls to cut back on likely exceed 600 MW, Wood Mackenzie says.
fossil fuel production.
Several oil majors are among the Who is leading the development of green hydrogen?
players jostling for pole position in green Green hydrogen seems to be on everyone’s mind at the moment, with at least ten countries
hydrogen development. Shell Nederland, looking to the gas for future energy security and possible exports. The latest nation to jump on the
for example, confirmed in May that it bandwagon is Portugal, which in May 2020 unveiled a national hydrogen strategy said to be worth
had joined forces with energy company €7-billion ($7,7-billion), up to 2030.
Eneco to bid for capacity in the latest Alongside oil and gas firms, renewable developers see green hydrogen as an emerging market,
Dutch offshore wind tender so that it could with offshore wind leader Ørsted last month trumpeting the first major project to exclusively
create a record-breaking hydrogen cluster target the transport sector.
in the Netherlands. Beyond such big names, a host of smaller companies is hoping to grab a slice of the growing
Days later, BP’s solar developer green hydrogen pie. Companies such as ITM Power might not be that well known today, but if
Lightsource BP revealed that it was mulling green hydrogen lives up to a fraction of its promise, it could one day be huge.
the development of an Australian green
hydrogen plant powered by 1,5 GW of wind What about hydrogen vehicles?
and solar capacity. Big Oil’s interest in green The eye-catching Toyota Mirai helped fuel early hopes that hydrogen fuel-cell vehicles might vie
hydrogen could be critical in getting the with electric cars to take over from the internal combustion engine. But as the EV market has
fuel through to commercial viability. Cutting boomed, the prospect of hydrogen being a serious contender has faded from view, at least in the
the cost of green hydrogen production will passenger vehicle segment. There are roughly 7600 hydrogen fuel-cell cars on US roads today,
require massive investment and massive compared to more than 326400 plug-in electrics that were sold in the US last year alone. That
scale, something the oil majors are uniquely said, pundits still expect hydrogen to play a role in decarbonising some vehicle segments, with
positioned to provide. forklifts and heavy-duty trucks among those most likely to benefit.

How much does green hydrogen cost to Acknowledgment
make? This article was first published by Greentechmedia in June 2020 -
Green hydrogen is still expensive to produce https://www.greentechmedia.com/articles/read/green-hydrogen-explained
today. In a report published last year (using
data from 2018), the International Energy Send your comments to rogerl@nowmedia.co.za

energize | June 2021 | 26