Known since the 1700s as the simplest element on earth, hydrogen is used in a wide range of processes and industries and while currently most of it comes from fossil fuel sources, research into clean hydrogen options is happening in different parts of the world. Renewable hydrogen is expected to play a pivotal role in the transition to a sustainable energy future.
Today, around 80% of hydrogen demand comes from three main industries - refineries, ammonia production and metal processing. Its use in energy applications, meanwhile, is estimated to be between 1% and 2% of total consumption.
A report by the Australian Renewable Energy Agency (ARENA) and ACIL Allen Consulting, published in the summer of 2018, indicates that the world produces roughly 55 million tonnes of hydrogen almost entirely for non-energy purposes, but that is to change significantly between 2030 and 2040.
The significant expansion of renewable energy capacities around the globe has opened up new opportunities for hydrogen in energy. It can be used to store surplus wind and solar power generation, to fuel cars and larger vehicles, and even to replace fossil fuels in heat and power generation.
One of the major challenges, for now, is the price. The high cost of hydrogen production is an issue that has triggered a wave of research and development (R&D) projects globally, fuelled by ambitions for deploying it in a wider range of sectors.
GLOBAL EFFORTS
Many countries around the world have adopted policies supporting hydrogen R&D. One example is Japan, which in 2017 introduced a basic hydrogen strategy in line with the 2015 Paris Agreement, seeking to promote the wider hydrogen use and form global collaboration to lower costs and ensure stable supplies.
The US, meanwhile, is funding multiple projects focused on new hydrogen and fuel cell technologies through a special Hydrogen and Fuel Cells Programme, attempting to tackle obstacles such as the lack of infrastructure and available technical solutions.
France’s hydrogen strategy includes indicative targets for promoting the use of green hydrogen in industry. The government has set a goal for 10% decarbonised hydrogen in the industrial sector by 2023, rising to between 20% and 40% by 2028. Last year, it set aside EUR 100 million for the deployment of hydrogen in the industry, mobility and energy sectors.
A series of trial projects are being funded in Australia to study hydrogen production as the country sees an opportunity to turn some of its growing renewable energy generation into hydrogen and inject renewable hydrogen into the gas network in particular locations, such as Sydney. According to ARENA, hydrogen is considered as a potential option to export renewable energy from Australia to other countries, mainly in Asia, where demand is expected to grow.
Multiple government tenders are also being held in the UK. In October 2018, the Department for Business, Energy and Industrial Strategy (BEIS) awarded GBP 382,000 (USD 494,400/EUR 440,600) worth of contracts to two firms to study the feasibility of converting commercial sector appliances and industrial heat generation from natural gas to hydrogen.
CORPORATE-LEVEL STRIDES
Some of the biggest industrial players, such as France's Engie (EPA:ENGI), which at start-2018 set up a new global business unit dedicated solely to renewable hydrogen, have rushed to study different opportunities to produce and use green hydrogen.
Austrian electricity company Verbund AG (VIE:VER) is testing the use of hydrogen as a natural gas substitute in a pilot project, with the participation of German cleantech specialist Sunfire and Graz University of Technology. Hydrogen produced from clean energy using high-temperature electrolysis will partially substitute natural gas at Verbund’s 838-MW gas-fired power plant. For that purpose, the Austrian firm is building at the site a pilot plant to serve both as an electrolyser by taking excess wind and solar power from the grid and converting it into hydrogen and as a fuel cell. The pilot project is supported by the European Union's "Horizon 2020" programme.
Swedish utility Vattenfall AB and domestic refiner Preem have recently signed a cooperation pact to jointly produce fossil-fuel hydrogen that can be used on a large scale in the biofuel, electrification and electricity supply industries.
Dutch paints, coatings and speciality chemicals company Akzo Nobel NV (AMS:AKZA) is partnering with Swedish players to study opportunities for using renewable electricity to produce green hydrogen and electrofuels.
Developing green hydrogen projects linked to its offshore wind farms in the Netherlands are among the future plans of Denmark’s Ørsted A/S (CPH:ORSTED). The energy group recently announced this, along with plans to bid in the tender for sites III and IV of the Hollandse Kust Zuid (Holland Coast South) zone off the Dutch coast. "Using offshore wind to produce green hydrogen from electrolysis is an enabler to decarbonize other sectors such as heavy industries and transport. Production and sale of green hydrogen to large industrial customers can help stabilize revenues from offshore wind farms which rely on the market price of power [..],” said Ørsted’s CEO and president Henrik Poulsen.
Another company focusing on hydrogen is France’s Air Liquide SA (EPA:AI), which has a number of partnerships to produce and distribute green hydrogen and establish hydrogen fueling infrastructure. The company says it aims to be a leader in the development of hydrogen for mobility throughout the entire supply chain. In February, it broke ground on a 20-MW production facility for carbon-free hydrogen in Canada.
A project by the Australian unit of Japanese carmaker Toyota Motor Corp (TYO:7203) is working on a project that aims to show how hydrogen can be a viable fuel source for transport and an energy storage medium. The company’s goal is to produce at least 60 kg of renewable hydrogen per day through electrolysis, with the needed power coming from solar photovoltaic (PV) panels and battery storage.
When fuelled by hydrogen produced from renewables, fuel cell electric vehicles (FCEVs) are a low-carbon mobility option that is becoming more widespread. It is an idea that is being used both in lighter vehicles and heavy-duty vehicles, such as buses and trucks, and production costs for it have dropped significantly over the past years. In September 2018, for instance, Alstom (EPA:ALO) started the commercial operation of the world’s first hydrogen fuel cell train in Germany -- Coradia iLint. Automotive giant Hyundai Motor (KRX:005380) announced at the same time that 1,000 hydrogen trucks will be put in operation in Switzerland by the end of 2019 through a partnership with Swiss hydrogen company H2 Energy.
The International Energy Association (IEA) released a report in March 2019, showing that the US has the largest fleet of FCEVs, 4,500 units, followed by Japan with 2,400, Germany and France, as of April 2018.
(USD 1.0 = EUR 0.891)
(GBP 1.0 = USD 1.295/EUR 1.154)
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EMEC hydrogen storage cylinders (Credit Colin Keldie)
