Myth: Hydrogen is a no-regrets solution for every sector
The universality of hydrogen as a decarbonisation solution has created a lack of consensus and clarity about where it is really needed. Hydrogen is sometimes described as the “Swiss Army Knife” of decarbonisation, playing a role in almost every industry as it can be burned to produce electricity or heat, serves as a carbon-free input to produce “green” steel and fertiliser. and power everything from passenger vehicles to deep-sea cargo ships.
Reality: Hydrogen should be prioritized in “hard-to-reduce” sectors
In theory, hydrogen can actually be used to decarbonize almost any industry. But just because it can doesn’t mean it should. As one of several tools in the decarbonisation toolbox, hydrogen should be prioritized in applications where energy efficiency and direct electrification are not possible. In particular, hydrogen’s potential to quickly and cost-effectively decarbonize the worst-off sectors makes it an essential part of the clean energy transition.
One of the factors limiting global decarbonisation is the scarcity and value of renewable electricity, which is used to produce ‘green’ hydrogen. The world already needs much more clean electricity infrastructure, as energy consumption is expected to double in 2050 due to population and economic growth alone – and only 10 percent of electricity today comes from solar and wind. Add the electricity needed to produce green hydrogen to decarbonize heavy industry and transport, and energy consumption could triple. Given this situation, it is important on a macro level to prioritize the reduction of electricity consumption and the most efficient use of electricity from renewable sources. As such, many of today’s microscale hydrogen business cases for building heating, power generation, or light commercial vehicle fuel are better suited for energy efficiency investments or direct electrification (see Exhibit 1 below).
However, there are several applications where energy efficiency and direct electrification are unaffordable, impractical or simply impossible. Enter hydrogen. Due to its flexibility, technological maturity and relatively low cost, hydrogen is one of the primary solutions for the decarbonisation of so-called hard-to-reduce sectors such as steel production and shipping.
The best tool for a difficult job
The specific applications where hydrogen shines may vary by geography, particularly as several developed economies are land-constrained and limited in their ability to build renewable capacity. But even before we consider the real-economy limitations, there are several unrepentant, high-priority applications of hydrogen that should be the main focus of policy and investment today: fertilizer production, petrochemicals and refining, steelmaking, shipping and some markets, long-haul heavy-haul transportation railways and trucks. All these sectors need hydrogen for decarbonisation, are technologically ready for the transition and are significant contributors to global emissions. In time, hydrogen is likely to expand beyond these basic applications.
Exhibit 1 illustrates the reduction in carbon emissions per kilowatt-hour (kWh) of zero-carbon electricity used either directly in an electrified end-use or indirectly through hydrogen production. This quantitative assessment confirms the main philosophy of priority hydrogen applications: use hydrogen where you cannot electrify. Direct use of electricity whenever possible provides the greatest emission reduction potential, largely due to the low return efficiency of using hydrogen in these applications (building heat, power generation and light transport).
Diagram 1: Emission reduction potential per kWh of electricity
Note: Building heat compares a heat pump with a coefficient of performance of 2.92 and a hydrogen boiler with an efficiency of 80 percent to burning natural gas. Power generation compares direct electrification and a hydrogen turbine with an efficiency of 60 percent to burning natural gas. Light commercial vehicles compare 50% fuel cell electric vehicle and 70% fuel cell battery vehicle and 30% gasoline tank-to-wheel combustion engine, including electricity for hydrogen compression. Hydrogen replaces coking coal for steel, hydrogen produced by steam methane reforming for fertilizers and diesel for trucking. Ammonia replaces heavy fuel oil in an internal combustion engine with an efficiency of 39 percent for marine transportation. Source: Emission intensity values from EIA
Apply today with no regrets
Hydrogen is already widely used today – the problem is that much of it is emission-intensive hydrogen from fossil fuels. Hydrogen production for fertilizer production and oil refining currently contributes ~2 percent to global emissions. Using clean hydrogen to decarbonize these current carbon-intensive hydrogen uses is an essential application, and the EU is committed to replacing all “grey” hydrogen derived from natural gas by 2030. Given the 1:1 swap between clean and conventional hydrogen feedstocks, these industries could serve as a locomotive in expanding the supply chain and reducing the cost of clean hydrogen technology.
Hydrogen is also a top priority for steelmaking, given the size of the industry’s emissions and limited decarbonisation alternatives. Today, steelmaking is responsible for ~8 percent of global emissions, primarily due to the use of coking coal to remove oxygen from iron ore to create pure iron, a chemical process called “reduction.” The replacement of coking coal with hydrogen in this reduction process is the most promising and advanced solution to the decarbonization of steelmaking.
Similarly, marine shipping—about 2.5 percent of global emissions and growing—has few deep-sea decarbonization options beyond hydrogen-based feedstocks. Electrification is possible for regional shipping, but for long-haul shipping, which accounts for most of the sector’s emissions, hydrogen or its derivatives (ie ammonia or methanol) will be necessary. Biofuels do represent an alternative to hydrogen-based fuels, but feedstocks are limited and their use is largely favored in the aviation rather than the maritime industry.
Heavy trucking, which accounts for roughly ~4.5 percent of global emissions, is likely to need hydrogen for the heaviest vehicles covering long distances, given the limitations of battery energy density and long charging times along with the distances required to travel. .
Longer term applications for hydrogen
Aviation boasts several options for decarbonisation, with feasibility varying depending on aircraft size and distance to travel. Electrification comes into consideration for shorter routes. Biofuels, synfuel or hydrogen appear as key solutions for longer routes. However, there are technological, design and regulatory hurdles that must be met before hydrogen is ready for use in the industry; until then, zero-emission aviation is limited to the use of “fuel fuels” that do not require aircraft modification. To accelerate the decarbonisation of aviation once the aircraft-side technology is ready, hydrogen infrastructure should be built today with a view to securing future supplies for airports in 2030.
As grids strive to fully decarbonize, they will require clean and fixed energy to move from 80 percent to 100 percent carbon-free electricity. Hydrogen is one of many ways to meet this need, in a company of solutions including demand response, batteries, carbon capture and storage, and geothermal energy. Although the jury is still out on a winning economic solution, the ease and flexibility of hydrogen – especially as a source of seasonal storage – provides fundamental advantages. When these resources will be needed to enable further decarbonisation of the energy system varies from grid to grid, but in general today renewable electricity should be added directly to the grid rather than being used to produce hydrogen to convert back into electricity.
Where direct electrification probably wins
Heating buildings and passenger transport in light commercial vehicles are applications likely to be more suitable for direct electrification than for hydrogen, as seen in Exhibit 1. Heat pumps are a commercially available, cheaper and more efficient solution for decarbonizing buildings in temperate and warm environments. climate. Similarly, the efficiency and availability of battery electric vehicles for passenger transport often make direct electrification the preferred solution. However, there are likely to be cases where hydrogen could be a viable solution, such as in places with limited use of renewable resources or where replacing infrastructure with electricity is incredibly difficult.
In addition to the direct use of hydrogen for the production of heat and electricity in buildings, mixing natural gas with hydrogen has received some attention. Blending hydrogen with natural gas does not require upgrading piping, turbines or boiler infrastructure, all of which are different in a pure hydrogen system. However, the emission reductions from blending hydrogen with natural gas are limited. Mixing in as much hydrogen as most pipelines can handle before degradation (~20 percent by volume) means only a 7 percent reduction in emissions, given the lower volumetric energy density of hydrogen compared to methane in natural gas.
Hydrogen is key to achieving our climate goals, but deploying hydrogen where energy efficiency and direct electrification are better options will hinder our ability to rapidly and cost-effectively decarbonize our energy system. To maximize system-wide efficient use of valuable clean electricity, hydrogen should be used when these solutions are not possible. Fertilizers, oil and petrochemical refining, steelmaking, and long-haul transportation of heavy loads are unrepentant applications of hydrogen today, to which aviation and long-term energy storage may eventually be added.
Author: Tessa Weiss, Thomas Koch Blank
© 2021 Rocky Mountain Institute. Published with permission. Originally posted on RMI Outlet.
Featured image courtesy of Siemens.
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