Moving hydrogen from hype to hope
Hydrogen is the talk of the town and the Commission makes it a big priority in its green industrial strategy. There are few hydrogen fuel cell cars and most of them are actually demonstration vehicles. TandEs own analysis suggests hydrogen is currently the only energy carrier that would enable zero-emission shipping and aviation, either as an end fuel or as the basis for a liquid fuel. Green hydrogen will not just have to compete with grey and blue hydrogen. It will compete with petrol, diesel, marine fuel oil, kerosene and, of course, electricity. The goals set should be realistic
How to create a secure market for green hydrogen (or hydrogen derived efuels) with high sustainability standards so that industry can make the long-term investments that are required to scale up sustainably? Introduce a standard requiring fuel suppliers to blend a low percentage.
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“I see a pivotal role for hydrogen,” in Europe’s efforts to achieve its climate goals, said Frans Timmermans. And up jumped the crowd in a rare standing ovation for a climate commissioner. Hydrogen is the talk of the town and the Commission is widely expected to make it a big priority in its green industrial strategy. So, are we about to enter the golden age for hydrogen and - if so - what does it mean for transport?
Seasoned observers will remember that this isn’t the first time hydrogen has created huge excitement. Jeremy Rifkins’ famous book, The Hydrogen Economy, exemplifies the starry-eyed enthusiasm of the 2000s. Egged on by fears that oil was running out, the then American president, George W Bush, launched the ‘Freedom Fuel’ initiative to boost hydrogen and make the US energy independent. Carmakers joined the race with Toyota, Daimler and others promising to build models that would popularise hydrogen cars for the mass market.
But, a decade later, hydrogen has not taken off. There are few hydrogen fuel cell cars and most of them are actually demonstration vehicles. There are also close to no hydrogen trucks, although Hyundai will be providing 1,000 fuel cell electric trucks to the Swiss market. Meanwhile, the first truck by Nikola - the hope of hydrogen trucking enthusiasts - will apparently be a battery electric truck.
A cynic might say that hydrogen is and will always remain the future. But the accelerating climate crisis does not allow us to be cynical. T&E’s own analysis suggests hydrogen is currently the only energy carrier that would enable zero-emission shipping and aviation, either as an end fuel or as the basis for a liquid fuel. It is also too early to write it off as an option for long-distance trucking but here hydrogen will have to compete with more efficient options such as catenary or battery electric.
But there’s a big difference between a technology’s theoretical potential in a climate model and its ability to take off economically. As the example of battery technology has shown, a technology can be expensive and underperforming to begin with but become competitive very soon after. Could something similar happen for hydrogen? And what will it take for that to happen?
There are two main ways to produce hydrogen. The first and most common method - accounting for 95% of current hydrogen production - is steam methane reforming based on fossil gas. Gas-based or ‘grey’ hydrogen isn’t exactly green. It is theoretically possible to add carbon capture and storage (CCS) to the process, producing so-called ‘blue’ hydrogen. But CCS deployment has run into a number of problems and blue hydrogen would cost twice as much as grey hydrogen although a higher carbon price could narrow that gap.
The green alternative to steam methane reforming is electrolysis, whereby water is split into hydrogen and oxygen using (vast amounts of) clean electricity. Some argue that the prospect of below €20/MWh electricity prices for utility-scale solar electricity coming from North Africa and the Middle East, or €50/MWh from massive offshore wind farms, means the poor efficiency of green hydrogen is no longer an issue. According to the International Renewable Energy Agency, “future costs of green hydrogen will be below those for blue hydrogen”.
But green hydrogen won’t just have to compete with grey and blue hydrogen. It will compete with petrol, diesel, marine fuel oil, kerosene and, of course, electricity. Wherever batteries are a practical solution - cars; vans; urban, regional and perhaps long-haul trucks; ferries - hydrogen will face an uphill struggle because of its lower efficiency and, as a result, much higher fuel costs. As the CEO of Volkswagen recently put it: “To drive the same 100km you need three times the wind farms than you do with electric cars.”
The lesson from half a century of hydrogen enthusiasm is that the technology won’t just take off. Pouring money into R&D isn’t enough. We’ll need a comprehensive and sustained public support programme to bring the technology to scale and reduce the costs. Most importantly, we will need lead markets.
Our proposal would be to focus on two sectors where there is a clear role for hydrogen and where regulatory action has so far been lacking almost completely: aviation and shipping. The goals set should be realistic and achievable and should focus on creating a secure market for green hydrogen (or hydrogen derived efuels) with high sustainability standards so that industry can make the long-term investments that are required to scale up sustainably.
One way to achieve this would be to introduce a standard requiring fuel suppliers to blend a low percentage of efuels into aviation fuel; or to require airlines to purchase certain volumes. For shipping, stringent operational CO2 and zero-emission port standards could be used to require cargo and luxury cruise ships to run on green hydrogen or ammonia. Ports will play a major role in any successful hydrogen strategy as this is where hydrogen would likely come on shore. So it would also make sense to roll out hydrogen refueling infrastructure for trucks in major port areas.
The advantage of this approach is that it would avoid massive expenditure on gas grid upgrades or on the roll-out of an inland hydrogen refueling infrastructure network across Europe. And it would focus the hydrogen effort on where no better alternatives exist. It might not offer us a standing ovation from hydrogen economy enthusiasts but it would be an effective, responsible and sustainable strategy.
Author: William Todts, Executive Director at Transport&Environment