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Hydrogen Fuel: Savior or Fantasy

The allure of hydrogen is obvious. When fueled by pure oxygen, it produces harmless water vapor, not carbon dioxide, with zero actual greenhouse gas emissions.

Potential applications for hydrogen are also varied. Hydrogen provides far more energy per liter or gram than batteries, making it a well-recognized candidate for powering aircraft, trains, automobiles, and ship engines. Hydrogen can also store energy, so it can potentially play a role in generating electricity and serve as a backup for intermittent supplies of renewable energy sources such as solar and wind. Hydrogen can be stored for several months without losing a lot of energy.

Hydrogen is also finding a place in heavy industry. Steel production currently accounts for nearly a quarter of all industrial CO2 emissions. Sweden is currently trialing a zero-emissions alternative that would switch to cleaner-burning hydrogen.

It is this combination of environmental sustainability and application flexibility that has contributed to forecasts of a surge in hydrogen usage and has driven the valuations of experimental hydrogen companies soaring.

Challenges to Hydrogen Energy

The problem is that we’ve explored hydrogen use before, and more than once. General Motors built its first hydrogen-powered car in the 1960s. A decade earlier, at the start of the Cold War, the U.S. Air Force secretly built the world’s largest liquefied hydrogen plant north of Miami as part of a plan to develop hydrogen-fueled aircraft.

Each time, hydrogen has encountered cost and complexity issues that have made it difficult to commercialize the gas as a fuel.

From an emissions standpoint, we start by considering that not all hydrogen is naturally the same. Using hydrogen may not produce carbon dioxide, but in order to produce the gas, we need to separate the hydrogen molecule from the compound in which it is found.

Currently, most hydrogen is produced by reforming methane (CH4) at high temperatures, but this produces carbon dioxide as a by-product. Electrolysis is an emission-free method in which an electric current is passed through water (H2O) to separate hydrogen from oxygen. But unless the electricity comes from renewable sources, there are also environmental costs.

“Hydrogen is a clean fuel, but only if it is produced in a clean way and used in a clean way,” said Mark Jacobson of Stanford University’s Woods Institute for the Environment.

In recent years, dictionaries have been compiled documenting the different types of hydrogen, each defined in terms of the production process (and therefore, with regard to the accompanying emission levels):

The key point is that “green” hydrogen produced from electricity generated from renewable sources currently accounts for only about 1% of the global hydrogen supply. At least for now, it’s also by far the most expensive source of hydrogen, but this could be eased in the future if the price of electricity from renewable sources falls.

Costs are likely to come down as electrolyzer technology improves and is deployed at scale. But another concern is that producing hydrogen could simply mean diverting renewable energy from other uses. Electrolysis is also not particularly efficient, resulting in an immediate loss of 30% of energy.

“Blue hydrogen” is an alternative that uses methane as before, but in a way that captures, separates, and stores the carbon dioxide produced or puts it to use. Japan is betting big on Carbon Capture, Utilization, and Storage (CCUS), sponsoring projects in southern Australia that convert lignite into hydrogen while capturing the carbon dioxide emitted. The EU, on the other hand, clearly supports green hydrogen.

green hydrogen
Made by electrolyzing water (H2O) using clean electricity from renewable energy technologies, separating the hydrogen atoms in it from its twin oxygen atoms. Very expensive at the moment.

blue hydrogen
Produced using natural gas, but carbon emissions are captured and stored or reused. Yields are negligible due to the lack of capture projects.

grey hydrogen
This is the most common form of hydrogen production. Grey hydrogen comes from natural gas and is produced by steam methane reformation, but the emissions are not captured.

brown hydrogen
The cheapest way to make hydrogen, but also the most damaging to the environment due to the use of thermal coal in the production process.

blue-green hydrogen
Hydrogen and solid carbon are produced using a process called methane pyrolysis. Not validated for mass production. There are concerns about methane leaks.

In addition to fuel sources, hydrogen faces the same challenges as other low-emission energy sources. For example, in terms of transport, hydrogen takes up more space than diesel or gasoline and therefore requires larger storage tanks, affecting the economy. While hydrogen can be piped like natural gas, there is currently no existing network of filling stations.

Due to the lack of an obvious commercialization path, some big companies are less enthusiastic about hydrogen fuel applications than the government. France and Germany have pledged a combined €16bn to develop hydrogen technology, but Volkswagen chief Herbert Diess recently dismissed the idea of a hydrogen-fuelled car even within 10 years.

Turning hydrogen into a global fuel will also mean developing shipping. Japanese and Australian companies are collaborating in southern Australia to liquefy hydrogen at -253°C for loading on ships. This requires a huge capital investment. Professor Ad van Wijk points out that hydrogen can also be converted into ammonia or stored in a liquid organic hydrogen carrier for transport.

Will it be different this time?
There’s one simple reason to believe that this time might really be different, and despite the challenges, hydrogen energy could still go mainstream. The argument arises from a simple premise: there is no alternative.

Past hydrogen commercialization efforts have been driven by hopes for energy independence, or in response to rising oil prices—in other words, when geopolitical tensions subside, those incentives can easily dissipate.

This time around, governments around the world have made long-term commitments to cut carbon dioxide emissions that are unlikely to falter given the existential threat posed by climate change. They are also pouring real money into the technology, with governments in 15 countries and the European Union announcing hydrogen plans last year, often including subsidies for the industry.

Professor Ad van Wijk, Delft University of Technology, said: “2020 has really been a year for countries to develop concrete ideas and strategies. This includes a strong commitment to integrating hydrogen into the energy mix. After Fukushima, Japan has said ‘we will continue to use nuclear power, but we also need another energy source’.”

In other words, there are two dynamics at work: the government is throwing money at an industry critical to emissions targets, and companies are hesitant to adopt a fuel that is not yet profitable. Government support will hopefully eventually stimulate research, reduce costs and make it affordable.

More and more think tanks in the business and investment world are betting on this, and their decisions are based on the assumption that d: emissions targets cannot be met without hydrogen. Oil majors such as Shell, for example, are starting to invest heavily in electrolyzers that produce green hydrogen.

Some research results containing tangible technological innovations have also emerged. In Germany, for example, researchers have found a way to store hydrogen in the form of a paste. This approach eliminates the need for supercooling to liquefy the gas for transport and provides a more convenient material to feed into the fuel cell.

Deploying hydrogen as fuel still faces significant technical challenges. But mobilization initiatives around the world are filtering into corporate decision-making and presenting an excellent opportunity to overcome these challenges.