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The energy transition is at risk by hydrogen’s perceived simplicity

Low-carbon hydrogen will almost certainly be needed to cut emissions across a range of hard-to-abate sectors. However, if it is used to solve too many problems, it could end up delaying the energy transition and putting urgent decarbonisation plans in jeopardy

The hype around low-carbon hydrogen risks crowding out more efficient ways of getting some hard-to-abate sectors to net-zero by 2050


HARD TO ABATE
Low-carbon hydrogen is being touted as the key to dealing with sectors that cannot easily be decarbonised through electrification IMPOSSIBLE TASK
Experts worry that too much emphasis on hydrogen could divert attention and funds away from more effective ways of reaching net-zero KEY QUOTE
Direct electricity usage is always best, for efficiency reasons


Johann Weibe is building a business on something you cannot see, smell or touch. Since April 2020, he has been setting up an information service tracking what is quickly becoming the hottest gas on the planet: hydrogen. I am creating an ecosystem of everything relevant to hydrogen,” enthuses the London-based former metals analyst. I want to offer updates on what is happening in Asia, Europe, North America and around the world.” The energy transition is creating massive opportunities for new types of hydrogen, beyond traditional processes such as petrol refining and fertiliser production. This is the market Johann Weibe wants to tap into and he is far from being alone. Some experts worry that the economic interests behind hydrogen’s use in the energy transition could end up thwarting the very challenge hydrogen is aiming to solve—reaching net-zero carbon emissions by 2050. If it is not used in the right way to cut emissions, this simple molecule could end up being disastrous,” says Richard Lowes of the Regulatory Assistance Project (RAP), a clean energy non-governmental organisation. LOW-CARBON HYDROGEN At the heart of the issue is how hydrogen will need to be made for use in the energy transition. Hydrogen in all its forms can replace fossil fuels in a range of applications where renewable electricity cannot work. However, today the 90 million tonnes of industrial hydrogen currently produced every year is almost entirely being made using a process called steam methane reforming. This requires vast amounts of natural gas and releases seven kilograms of carbon dioxide for one kilogram of hydrogen. These emissions can be curtailed by adding carbon capture and storage technology to the process, resulting in blue” hydrogen. Because of the need for added infrastructure, this is more costly than the traditional grey” hydrogen. Additionally, the extent to which using blue hydrogen actually reduces emissions is debatable. A large part of the current emissions from natural gas production comes about when it is extracted, not when it is used. The extraction process releases methane, which is an even more potent greenhouse gas than carbon dioxide. Most of the methane is vented or flared, making it the second-largest cause of global warming, according to the International Energy Agency. GOING GREEN The gas industry is working to cut its methane emissions, but that is a separate endeavour to creating blue hydrogen—and one that will only increase costs further. A cleaner option in the long term is the green” version of hydrogen, made via the electrolysis of water using electricity generated from renewable sources. However, making green hydrogen is highly inefficient. According to the International Renewable Energy Agency (IRENA), it takes around 51 kilowatt-hours of electricity to produce a kilogram of green hydrogen using current electrolyser technology. IRENA believes this 65% conversion efficiency could rise to 76% by 2050. However, that still means around a quarter of the energy required for green hydrogen synthesis will be wasted. If you want to make green hydrogen cheaply, you need renewable energy to cost as little as possible. These factors mean that, from a policy perspective, it makes sense to use green or blue hydrogen only when truly needed: in industries that have few other options when it comes to cutting carbon. There are some obvious candidates. Take the metallurgical industry, which uses coke as a fuel and as a reducing agent. To eliminate the emissions from coke, green hydrogen could provide both fuel and reaction capabilities. In a similar vein, there is no battery today that could power a ship across the ocean, so to reach net-zero maritime vessels might need low-carbon fuels based on hydrogen. There may be other ways to decarbonise these sectors, such as turning iron oxides into steel plates using electrolysis or powering ships with biofuels, but hydrogen is promising because of the scale it could achieve. DECARBONISATION DIFFICULTIES Where possible, Direct electricity usage is always best, for efficiency reasons,” says Michael Weinhold from engineering firm Siemens. Yet, We have domains where decarbonisation via direct electrification will not be possible,” he adds. There is a debate over which domains are best suited to hydrogen rather than electrification, however. Some stakeholder groups have a vested interest in expanding hydrogen’s role in future energy systems. Foremost among these groups is the oil and gas sector. With blue hydrogen, oil and gas companies can be seen to contribute to decarbonisation efforts while still peddling natural gas and ultimately continuing to emit carbon and other harmful gases. Unsurprisingly, oil and gas companies are keen for blue hydrogen to be seen as a key tool in the fight against climate change. In the UK, oil and gas major BP is aiming to supply enough of the gas to meet 20% of the nation’s 2030 hydrogen target—which is set at 5 gigawatts (GW) of production capacity—from a single project in Teesside, northeast England. Shell, an Anglo-Dutch oil and gas major, has announced projects to supply hydrogen for shipping and transportation. EVERYONE WINS The potential for oil and gas investments has caught the attention of other companies with an interest in the hydrogen value chain. Chemical giants such as Britain’s Linde are bullish on low-carbon hydrogen because of its potential to help them become part of the global energy value chain. The excitement around hydrogen even extends to the renewables industry. Companies developing solar plants and wind farms see the green hydrogen economy as providing an increased market for clean electricity, adding further revenue streams to those already available through power markets. For all these reasons, it is easy for politicians to sign off low-carbon hydrogen plans, no matter what they are aimed at. Green and blue hydrogen offer a neat way of solving some of decarbonisation’s more intractable problems while preserving or creating jobs and perhaps even providing a future source of export income. However, this growing enthusiasm for hydrogen is leading to it being proposed for applications where its usefulness is questionable at best. One of these is heating. NOT SO HOT Northern Gas Networks, a gas distribution company in the UK, is running a project called HyDeploy that aims to see if the emissions from natural gas can be cut by blending it with hydrogen. On paper, this sounds like a smart idea: heating accounts for about 37% of the UKs emissions, according to Energy Systems Catapult, a public-private innovation body. Much of this comes from burning gas, so mixing it with green hydrogen—which burns without emitting harmful gases—could cut emissions substantially. The problem is that it is much more efficient to heat homes using electricity to drive heat pumps. It’s about a seven times difference in the amount of primary energy needed,” says Lowes at RAP. That is the fundamental physics issue here: you will always get losses.” The UK is looking to install around 150 GW of offshore wind capacity by 2050, up from just over 10 GW today, he says. The total should cover most of the nation’s heating requirements, assuming there is a mainstream switch to heat pumps—which itself would significantly add to the nation’s electricity demand. If heating is to be achieved using green hydrogen, though, you’re probably talking about something like 400 or 500 GW [of additional required capacity],” says Lowes. SCALING ISSUES There is a similar issue with using hydrogen as a fuel for cars and light-duty vehicles. Toyota’s sleek Mirai passenger car, powered by a hydrogen fuel cell, was touted as the future of motoring upon its launch in 2014. In practice, though, battery-powered vehicles are a much more efficient form of low-carbon transport and the technology of choice because they can use electricity directly without having to turn it into hydrogen first. This difference in efficiency would not be an issue if we had infinite time and resources to reach net-zero emissions. However, it is unclear whether Europe will be able to build out renewables quickly enough to meet its 2050 goals for electrification, let alone have sufficient capacity left over to serve a green hydrogen sector of any significant size. Scaling up clean power generation to meet the needs of electrification and green hydrogen production is definitely a challenge,” says Alexander Esser of Aurora Energy Research, especially where the acceptance of renewables has come down.” LIMITED TIME While the main challenge in scaling green hydrogen production relates to the availability of renewables, the additional need for electrolysers and other infrastructure is also far from trivial. In Europe, green hydrogen production would need to grow a hundredfold just to replace existing grey supplies. European Union countries use around9.7 million tonnes of hydrogen a year and almost all of it would need to be converted from grey to green. The EU is planning to invest $430 billion in green hydrogen production by 2030. With time running out to keep climate change at manageable levels, there is also a danger that focusing on hydrogen in the wrong areas could lead to critical delays in adopting more suitable alternatives. Heating, again, is a prime example. Gas companies have an interest in keeping pipelines and distribution networks going for as long as possible. Hence, they are keen to point out that gas heating infrastructure could potentially be used to carry green hydrogen. This may also be true for some of the larger pipelines. In April this year, a fossil fuel-backed advocacy group called the European Hydrogen Backbone initiative claimed 69% of a proposed 40,000-kilometre hydrogen distribution network across Europe could consist of repurposed natural gas grids. However, most of the local distribution networks used to get gas into homes and businesses can only take a mix of around 20% hydrogen. Beyond that, the entire infrastructure would have to be replaced because higher hydrogen mixes could cause metal pipes to crack. This need may not become apparent for another decade or so, by which time it might be too late to scale up heat pump installations to the level needed to meet 2050 climate targets. NO REGRETS The most obvious solution is to focus funding and regulation on delivering low-carbon hydrogen to the sectors that really cannot cut emissions without it. In November 2021, the German think tank Agora Energiewende published a paper listing these no-regret” target areas for green hydrogen application. No-regret applications include using green hydrogen as a reaction agent in steelmaking, a feedstock for ammonia and other chemicals, a source of energy storage and a fuel precursor for long-haul aviation and maritime shipping. Beyond these were a set of more controversial uses where electrification might ultimately be a better idea than hydrogen. These included fuelling trains, trucks, buses and short-haul aviation and shipping, and delivering high-temperature heat for industrial processes. Finally, Agora Energiewende suggested a set of applications where it believed using hydrogen would be a bad idea: fuelling cars, light-duty vehicles and building-level heating. Agora Energiewende’s paper offered 12 insights on hydrogen. The first was: Analysts agree, but not all lobbyists: the role of hydrogen for climate neutrality is crucial but secondary to direct electrification.” Since scaling renewable hydrogen in Europe will require significant public financial support, Agora Energiewende says, it is important to minimise the risk of misallocation by identifying areas where hydrogen use is crucial.” HYDROGEN LADDER The Agora Energiewende categorisation resembles the Clean Hydrogen Ladder devised by the energy analyst Michael Liebreich and policy expert Adrian Hiel, which orders hydrogen applications from unavoidable” to uncompetitive”. According to the Clean Hydrogen Ladder, the top priority uses for green hydrogen should be for producing fertiliser and methanol and for industrial processes such as hydrogenation, hydrocracking and desulphurisation. The problem with focusing on such end uses is that it requires lawmakers to make choices about what to support. Yet, in general, policies should not be attempting to pick winning technologies,” says Enrique Glotzer of the consulting firm Charles River Associates. A good way to avoid this, he says, is not to focus too much on hydrogen production. Instead, policy instruments such as the EU Emissions Trading System should focus on supporting the creation of hydrogen demand whilst ensuring the lowest emissions possible from producers.” LOCAL FOCUS Focusing on demand might not prevent policies that lead to wasteful dead-end hydrogen uses, particularly when lobby groups are defending applications that may delay progress to net zero. Another approach is for European policy to set an overall direction and leave detailed decision making to local stakeholders. The energy transition puts lawmakers in an awkward position,” says Thomas Boermans of German energy giant E.ON. Normally they would want to stay technology-neutral and let markets and innovation do their thing. Now we don’t have time for that.” Allowing local interests to choose between options such as electrification, district heating or hydrogen makes sense. In some situations, the choice will be determined by local factors such as the availability of waste heat or building stocks that favour the installation of electric heat pumps for residential heating. In that respect, at least there is one good thing about the current hype around hydrogen: it is forcing all parties to work out what the molecule might or might not be able to achieve. Concepts such as no-regrets investments and the Clean Hydrogen Ladder are emerging just as the transition to low-carbon hydrogen is getting underway, potentially influencing the direction of travel. If we have failed in 2050, in my view it will not be because we didn’t discuss hydrogen enough in 2020 and 2021,” says Boermans. •


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Jason Deign