Inexperienced hydrogen: Why low-carbon fuels aren’t benefiting from excessive fossil gas costs

The quantity and scale of tasks utilizing and making hydrogen, a fuel that releases power when burned with out emitting carbon dioxide, is quickly rising.

If its development goes to plan, a Euro 2.5 billion (GBP 2.18 billion) undersea pipeline will convey “green hydrogen” from Spain to France from 2030.

Within the US, some energy stations are being upgraded to permit hydrogen to be blended with fossil fuel, and the Norwegian oil firm Equinor is teaming up with Thermal SSE to construct a 1,800 megawatt (MW) “blue hydrogen” energy plant in Britain.

In the meantime, China unveiled a plan in March which incorporates deploying 50,000 hydrogen autos by 2025 and early December noticed the primary hydrogen-fuelled tractors and forklifts go away the meeting line at a brand new plant in Guangdong province.

Hydrogen is produced in a number of methods. A color spectrum is used to render it easy.

“Grey” and “brown/black” hydrogen come from fossil fuel (methane) and coal (brown or black coal) respectively – a course of that, for each tonne of hydrogen, emits between ten and 12 tonnes of CO₂ for gray hydrogen and 18 to twenty for brown.

“Blue” is the same process except the carbon dioxide is supposed to be captured and stored underground. And “green” hydrogen is conventionally defined as generated from splitting water into hydrogen and oxygen using renewable electricity.

But only 0.04% of hydrogen is green, and blue hydrogen is less than 1%.

The rest is grey or brown, most of which is used in oil refineries and for manufacturing ammonia and methanol. It’s an enormous industry which emits more CO₂ than all of Britain and France combined.

It is widely hoped that a silver lining of today’s high gas prices will be green hydrogen becoming a cost-competitive alternative to dirty fuels in boilers, shipping tankers and steelworks furnaces.

Unfortunately, without electricity market reform, this opportunity is likely to be squandered.

And while the buzz around the hydrogen economy intensifies, a closer look suggests the fuel is less a spearhead for a green transition and more the subject of an elaborate bait-and-switch operation by oil companies.

Also Read | Green hydrogen: Fuel of the future? 

Hydrogen’s true colours Green hydrogen is essential for decarbonisation: to replace fossil fuels in steelmaking, ammonia production for fertilisers and possibly shipping and trucking – processes which are difficult to electrify.

Some green hydrogen is crosshatched with dirtier hues. So it’s not simply that in its production a lot of energy is wasted in the double transformation from electricity to gas and then fuel.

But burning hydrogen also emits nitrogen oxides, air pollutants linked to respiratory illnesses and acid rain.

If green hydrogen production is scaled up to play a significant economic role by 2050, its freshwater demand will exceed one-quarter of today’s global annual consumption, risking water scarcity in some regions.

Above all, hydrogen is meaningfully green only if the renewable energy that generates it cannot be fed into the grid to replace power from gas or coal plants.

Blue hydrogen relies on a similar – but much more harmful – trick of the light. For hydrogen to be true blue, the emissions must be captured and securely stored.

In theory, carbon capture and storage works but nearly all plants use the captured carbon to pump more oil and many have been shut down as failures. Only a handful store carbon indefinitely and even these consume lots of energy and capture only some of the CO₂, which can leak.

Blue hydrogen’s main source is methane, a powerful greenhouse gas that is notorious for escaping drilling wells and pipelines. Research suggests that these issues make blue hydrogen worse for the climate than fossil gas.

In the EU, as in many economies, electricity pricing is based on the principle of marginal costs, which means that the most expensive source (typically fossil gas) sets the wholesale power price.

During sunny or windy spells, a glut of renewable energy generation can slash electricity prices, freeing them from the grip of natural gas prices for a few hours at a time.

This is often not enough to justify investments in the electrolysers which produce green hydrogen. Green hydrogen won’t gain the necessary price advantage over blue hydrogen and fossil gas until electricity markets are restructured.

Meanwhile, the high price of oil and gas has turbocharged the industry’s expansion.

The US government is exhorting oil and fracking firms to “drill baby drill”. Britain’s government is to award more than 100 licenses to drill for oil and gas and colossal new fossil fuel investments have been announced across the Middle East and Africa.

In a few years when these new sources come onstream, and particularly if economic growth continues to slow and depress energy demand, gas and oil will become cheaper again – until the next price spike prompts new rounds of investment, and the infernal cycle continues.

Additionally Learn | India goals to be international hub for producing inexperienced hydrogen

The homeowners of newly-built wells, pipelines and terminals will battle to defend these property and stall decarbonisation.

Now fossil-fuel corporations are rebranding themselves as brokers of “carbon management.”

The intention is to forestall their property from getting stranded by repurposing them, presenting a largely fictional substance, blue hydrogen, as a low-carbon “bridge” to an unspecified inexperienced future.

Different sectors have joined the oil-led coalition. Because the engineer Tom Baxter observes, fuel community operators and boiler producers see their survival on this ploy. Utilities are equally eager, as hydrogen’s inefficiencies enable them to promote extra energy.

Tackling this stalling operation requires public coverage.

Governments might want to regulate or tax carbon out of the market whereas concurrently ramping up renewables.

The method to electrical energy pricing additionally must shift, to decouple the costs of electrical energy generated from renewables and fossil fuel.

The marginal pricing system vastly advantages renewable mission homeowners, since they revenue from excessive electrical energy costs and successfully zero enter prices.

Another market construction would set rewards for mills in line with their common prices plus a slight surplus which could possibly be reinvested into deploying extra renewables and different inexperienced applied sciences, offering customers with low-cost electrical energy. This could solely be achieved by means of a robustly regulated market or by nationalising power firms and setting costs and manufacturing.

These interventions would give inexperienced hydrogen a aggressive benefit over blue or gray variants, one which could possibly be furthered with different subsidies, akin to tax credit on the mannequin of the US Inflation Discount Act. Above all, power demand should be diminished to ease upward stress on value.

In any future power system, hydrogen may have a job. However its enlargement should be fastidiously designed, to forestall the promise of inexperienced hydrogen disguising the dangers of its blue and gray cousins.

London/Budapest (The Dialog)

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