By Lloyd Alter│TreeHugger│6 min

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Shell Oil recently sponsored a GreenBiz webcast with the catchy name “Say HY to our decarbonized future.” Ajay Mehta, Shell’s General Manager, NewEnergies Research &Technology, said the cost of electrolyzers that makes the hydrogen has dropped by 40% and the cost of renewable energy will keep dropping to the point that within ten years, “green” hydrogen, made with renewable electricity, will reach parity with “grey” hydrogen that is made from natural gas.Greenbiz

Mehta says Shell is pushing liquid hydrogen as a fuel for shipping and heavy-duty transport. Sunita Satyapal of the US Department of Energy, likes hydrogen as a way of dealing with the intermittency of renewables, calling hydrogen “the Swiss army knife of energy.” Janice Lin of the Green Hydrogen Coalition called green hydrogen “sunshine in a bottle.” From the webcast:

“You would always use renewable electricity if you could use it in that moment because it is instantaneous, but by converting that renewable electricity through electrolysis into a storable fuel, you are bottling this sunshine and now you can dispatch it whenever you need it so it enables us to take really low-cost abundant renewable electricity and extract value out of it.”

Lin described a fascinating project called the Intermountain Power Project (IPP) in Utah where an 1800 megawatt coal-fired power plant is being converted to a gas turbine-powered generator that will run on 30% hydrogen and 70% natural gas by 2025, and will run on 100% green hydrogen by 2045. The hydrogen will be stored in nearby salt caverns that are big enough to store an Empire State Building.

“The bulk hydrogen gas storage potential near IPP is massive. A typical cavern can store 5,512 tons of hydrogen gas, and over 100 caverns can be utilized. This is equivalent to 200,000 hydrogen buses, 1,000,000 hydrogen fuel cell cars, or 14,000 tube trailers full of natural gas.”

This all sounds counterintuitive and inefficient to me, using renewable power to make hydrogen and then burn it in a converted power plant and send it down the wires; Michael Liebreich of Bloomberg NEF says that the process is only 50% efficient, but it is better than burning coal.Royal Dutch Shell

For a hydrogen skeptic like me, this was all very impressive. Shell also has impressive documentation on their website, where they note that “Hydrogen is one of the most abundant elements in the universe and could play a significant role in the transition to a clean and low-carbon energy system.” Mehta also included a slide which described how Shell plans to reduce the emissions from the manufacture of their products to net-zero by 2050 or sooner (although those are Scope 1 and Scope 2 emissions, which do not include the actual burning of the fuel and currently are only about 9% of total emissions). And also to somehow “work with customers to reduce the emissions from their use of our energy products to net-zero by 2050 or sooner” – these are Scope 3 emissions, what comes out of the tailpipe when you burn their energy products, which is a pretty bold and impressive ambition.

On the other hand, there are many who are not ready to say HY to a hydrogen future just yet, maybe even at Shell. Coincidentally, on the same day as the Greenbiz webcast, The Financial Times described how “Royal Dutch Shell has been hit by the departure of several clean energy executives amid a split over how far and fast the oil giant should shift towards greener fuels.” The head of the solar and wind division, the leader of the strategy team, and the VP of offshore wind all quit. According to the FT, “people familiar with the internal debate said there were deep divisions over the timeframe for reducing the company’s dependence on oil and gas revenues, which had influenced at least some of the departing executives.”

On Unearthed, a Greenpeace UK site, Damian Kahya explains why oil companies want you to love hydrogen, noting:

“When lobbyists talk about hydrogen to governments, they first like to talk about green hydrogen – because that’s the easiest sell. Blue hydrogen sounds ok in theory – but in practice, the residual emissions are enough to bust through carbon targets.” 

(More on the different colors of hydrogen on Treehugger here.)

The problem is that there is not enough surplus renewable energy to make all that wonderful green hydrogen. And blue hydrogen – made from natural gas combined with carbon capture, utilization, and storage – gets rid of most, but not all, of the CO2, and doesn’t yet exist except on paper. So they will probably start with grey hydrogen made from gas through steam reformation, which happens to be a major existing industry for Shell and BP. Then they will transition to blue, and in the process keep their gas wells and their distribution networks going. They will promise green, even though much of that surplus renewable energy is probably going to be sucked up by electric cars, so it will probably be expensive and take some time until there is much of it.

What Do We Do With All That Hydrogen?

Adrian Hiel of Energy Cities, a European association of “cities in energy transition,” recently looked at this and set up a hierarchy that makes sense. The highest and best use will probably be in industry, where we have seen how hydrogen changes the chemistry of making steel. ThyssenKrupp is doing this now with grey hydrogen, and Uniper is going to make sponge iron with green hydrogen.

Heil also expects green hydrogen to be used for grid-level storage, but he projects it to have much higher marginal costs. He doesn’t think that is a problem, because it is a “peaker” fuel, used like natural gas is now in places with lots of carbon-free electricity.

As for the other uses proposed by proponents of the hydrogen economy, how about no. Batteries are getting better and cheaper every day and are far more efficient. As for home heating, a lot of proponents of hydrogen (and even the British Committee on Climate change) propose incrementally adding hydrogen, but Hiel tells Treehugger that “the people who argue for injecting a 20% hydrogen mix into the gas grid are more interested in maintaining 80% of their gas sales than decarbonising.” Electric heat pumps actually do the job far more efficiently. Hiel is just not convinced that green hydrogen is ever going to be a plausible alternative and tells Treehugger:

“Technically hydrogen can do just about anything but realistically there are very few things it can do better than direct electrification. Anyone expecting hydrogen to become a ubiquitous and cheap commodity is going to be disappointed.”

So Is It All Just a Green Fantasy?

Every time the subject of hydrogen-powered cars came up I used to quote that scene in The Matrix where Switch says to Neo: “Listen to me, Coppertop. I don’t have time for 20 Questions Right now, there’s only one rule: Our way, or the highway.” She is telling him that he is little more than a battery, and I wanted say to the hydrogen fans: Listen to me Coppertop – HYDROGEN IS A BATTERY. I wrote a few years ago about cars in particular:

“It is very simple: follow the money. Who is selling 95 percent of the hydrogen on the market right now? The oil and chemical companies. They make massive amounts of it for producing fertilizer and powering rockets and no doubt love the idea of selling more to power cars, and anyone who drives one is putting money in their pockets.”

Hydrogen isn’t a very good battery either, but perhaps that doesn’t matter. It can also be a source of heat for industrial processes and replace coke in steelmaking. Janice Lin of the Green Hydrogen Coalition says it could be used to make ammonia, which uses vast amounts of grey hydrogen now. (we covered the idea here) In Australia, they are going to use green hydrogen to make ammonia because it is easier to transport, with one proponent saying “with green hydrogen, Australia can export our sunlight.”

I have been negative about hydrogen because I am usually skeptical of fancy high-tech supply-side solutions, when instead we should be working on reducing demand. But as Adrian Hiel demonstrates, everything is a matter of degree; I can still rant about hydrogen cars and houses, but we still need a supply of industrial heat, ammonia for fertilizers, and even grid-scale batteries. So I am going to stop with the “Hydrogen: Fuel or Folly?” stuff; green hydrogen is going to be real and it has a role to play, and I will say HY.

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