We have finally seen the sunrise on the Hydrogen Economy. Especially here in the US, with the passing of the Bipartisan Infrastructure Law and the Inflation Reduction Act, the Department of Energy and the Federal Government has billions of dollars to invest in building hydrogen hubs and infrastructure. The broad agreement needed for the transition to hydrogen is widely accepted, but the exact mechanics of how the required hydrogen will be produced, transported, and stored is still uncertain.
This summer, the Department of Energy is expected to finally publish a road map for upwards of $8 billion to develop four clean hydrogen energy hubs. The funds were allocated to the energy provisions within the Bipartisan Infrastructure Law (BIL).
Unfortunately, the exact timing and awards haven’t been announced yet. However, the program is expected to finalize sometime between now and 2025. There are expected to be multiple planning grants, deployment grants, and deployment funds directly from the DOE.
History of Hydrogen Production and the Economy
While many millennials may assume that the hydrogen economy is new or something cutting edge, the fact is that this vision was put forward back in 1970; that’s also when the term “hydrogen economy” was termed. At the time, the term was mainly used to describe running nuclear and solar-generated hydrogen. Since then, producing hydrogen has become less of a priority.
In 2003, George W. Bush announced during The State Of The Union’s address that the US was investing $1.2 billion in research to help make the country the world’s leader in hydrogen-powered vehicles. That money was to be spent on developing fuel cell technology and a mechanism for transporting hydrogen.
However, later, funding for the program was slashed by the Obama administration. Steven Chu, the Secretary of Energy, said it had to be done based on a model that showed it wouldn’t be possible to transition to hydrogen-powered cars within 20 years. This led to a drop in R&D., but over the last decade, pressure to reduce greenhouse gas emissions has increased.
The Obama administration did not fully appreciate the growing recognition of the need to decarbonize and the role that hydrogen technologies can play in this process. The ever-increasing pressure on countries like the US to cut emissions means there is now more need than ever to have a vibrant green (carbon neutral) hydrogen economy. However, if reducing carbon dioxide is our goal, there is still a lot of catching up to do.
Goldman Sachs has said that the momentum could mean a 400x global hydrogen capacity increase within the next ten years. It could grow to be a $250 billion market in 2030, if not more.
The State of Hydrogen Today
Currently, hydrogen use in industry accounts for just 1% of the energy consumed in the US, and less than 5% of the hydrogen generated is clean or green. The DOE funds may help increase the amount of low-carbon intensity hydrogen produced (like green and turquoise hydrogen) with innovative technology and expand uses for hydrogen gas. Plus, it could draw more private investment.
The newly proposed hubs could work as an effective catalyst for everything from fueling automobiles to heating homes and power generation. Plus, it could help turn many grey industrial processes green. The BIL mandates one running hub to demonstrate using hydrogen for power generation, one hub for transportation, and one for the industrial sector. There is also a hub that needs to demonstrate its efficiency to heat the commercial and residential sectors.
It is worth mentioning that some applications are receiving more support from researchers and analysts. The money, as they say, is in decarbonizing otherwise hard-to-decarbonize sectors, and that’s where many focus their attention. The upside to this is that fewer fossil fuels are being burnt. In fact, hydrogen has the potential to power many industrial processes with high energy requirements. So if the switch is made, it can eventually account for 100 percent fewer greenhouse gas emissions. When looked at as a whole, container ships, airplanes, and other modes of transport roughly account for six percent of CO2 emissions. So, having the required hydrogen fuel for them and the infrastructure can end most of these emissions while ensuring we all enjoy the benefits of renewable electricity.
Future of Hydrogen Fuel Cells
Over the next few decades, we’ll see an increasing number of solar and wind farms. At different times of the day, some of these renewable power projects will generate more electricity than the electrical grid needs. This electricity can then be diverted towards making hydrogen, which can, in turn, be stored for an extended period, then burned in gas turbines or fed into fuel cells for more electricity.
However, there are cost challenges that need to be overcome. If green hydrogen is used to heat homes and businesses, it would have a carbon footprint similar to most renewables today. But it will also be 14x more expensive than all currently available energy sources.
Distributed Methane Pyrolysis
Clean, distributed methane pyrolysis might be the solution to these challenges facing hydrogen development. Why? The three main challenges to the switch over to hydrogen are the cost and availability of low carbon-intensity electricity, the difficulty of transmission, and the high cost of storage.
So the approach and economic value of distributed clean hydrogen generation from natural gas is a great solution. With the distributed generation of clean hydrogen the end user doesn’t have to pay for the cost of new infrastructure or worry about the cost of electricity. Once users are comfortable with the general use of hydrogen (initially via blending) with natural gas, they will then be prepared to embrace the ultimate state of adapting equipment to work with pure hydrogen as the ultimate 100% environmentally friendly fuel.
There is no denying that hydrogen plays a role in the net zero economy we are headed toward, but governments, especially in the US, need to ask tough questions. Research must be undertaken to accelerate use cases for hydrogen in communities and how they are a critical part of the overall decarbonization picture. All things need to be compared on cost-effectiveness, time to implementation, and carbon intensity from production through the point of delivery instead of simply choosing a technology approach because it sounds “green.”
Over the years, we’ve seen the interest in the use of hydrogen gas rise and slump. Not too long ago, there was a lot of talk about it, but then it died down. Today, the climate is a significant issue, and it has become a thing of urgency; the hydrogen economy is no longer a talking point; it is becoming a reality.