A plan to produce 800MW of blue hydrogen and use it mainly to produce electricity would increase power costs and the consumption of expensive natural gas, but society will benefit, co-developer Air Products tells Recharge.

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The US-based industrial gases company and UK gas-focused power producer VPI last week announced plans to jointly produce 800MW of blue hydrogen — derived from fossil gas with carbon capture and storage — at the “Humber Hydrogen Hub” (H3) in northeast England, and use most of that H2 to reduce emissions at VPI’s 1.26GW Immingham gas-fired combined heat and power plant.

“The majority of the low-carbon hydrogen would serve as a substitute fuel for VPI’s existing third gas turbine power train,” the two companies said in a joint statement.

“Combined with deployment of post-combustion capture technology on trains 1 and 2 at VPI Immingham as part of the Humber Zero project, H3 would bring substantial decarbonisation to the VPI combined heat and power facilities, saving over two thirds of the emissions from its Immingham industrial site.”

Essentially, Air Products would extract hydrogen from methane (CH4) using either steam methane reformation (SMR) or autothermal reformation (ATR) and capture most of the CO2 produced in the process — two million tonnes a year that would be stored in a saline aquifer under the North Sea. This so-called blue hydrogen would then be burned at one of the three gas turbines at the Immingham power plant instead of natural gas.

Because hydrogen contains roughly 30% as much energy as methane by volume, about 3.3 cubic metres of H2 would be required to deliver the same amount of energy as 1 cubic metre of natural gas. In other words, burning gas-derived hydrogen requires 3.3 times more fossil gas than if the latter was burned directly.

And, of course, increasing the amount of methane required also increases the cost of electricity production — far from ideal at a time when Europe is trying to wean itself off Russian natural gas, and both gas prices and electricity costs are at record highs.

On top of all this, a lot of energy would be needed to power the methane reformation process, and then compress the H2 for delivery at the power station, thus reducing the energy efficiency even further. And this energy would need to be renewable to prevent a further increase in the project’s emissions.

Air Products acknowledges these problems, but tells Recharge: “As enshrined in the UK’s Net Zero legal obligations, the net benefit to society will offset any additional cost (which we’re committed to ensuring is as minimal as possible).”

And at a time when historically high gas prices mean green hydrogen would theoretically be cheaper to produce than blue H2 in Europe, why go for the more expensive and less clean option?

Even Jorgo Chatzimarkakis, the bullish CEO of trade body Hydrogen Europe, stated at the recent Eurelectric Power Summit that “blue hydrogen doesn’t sell, it’s too expensive”.

But Air Products told Recharge in a written statement: “Given the urgency of reaching net-zero emissions, both low-carbon and carbon free hydrogen are well placed to support the UK’s Energy Transition. Both Air Products and VPI are seeking to work with UK government to establish the most cost-effective solution in any given situation; Air Products is developing significant blue and green projects around the world,” the company told Recharge in a written response to questions.

“Regarding the point that ‘green’ is cleaner than ‘blue’ (or low-carbon using our terminology for the project) — neither the terms “blue” or “green” indicate a specific carbon intensity. Both can meet a range of carbon footprint reductions, depending on circumstances.”

The US company also confirmed that “similar to nearly all decarbonising projects in the UK, subsidies are required”.

Air Products and VPI have already submitted an application for “Strand 1” funding from the UK government’s £240m ($286.5m) Net Zero Hydrogen Fund.

The co-developers have not stated how much their project might cost, but the world’s only existing large-scale blue hydrogen project — Shell’s Quest CCS project in Alberta, Canada — cost about $1bn, with Canadian taxpayers contributing C$840m ($645m) and a further C$50m a year for running costs. And this demonstration project only captures less than half of the CO2 emitted.

Air Products tells Recharge it is not disclosing whether the blue H2 will be produced via SMR or ATR — the latter being more energy intensive but producing a more concentrated stream of CO2 in its flue gases, which is therefore easier and cheaper to capture.

But it says that “we estimate that the hydrogen produced will meet the [UK] government’s Low Carbon Hydrogen Standard [LCHS]”.

This standard currently sets a greenhouse gas emissions intensity of 2.4kg of CO2e per kilogram of hydrogen.

An Equinor spokesman told Recharge in April that if blue H2 were to meet the LCHS, a project would need “at least 90% carbon capture if using UK gas and preferably 95% to have a workable margin”.

However, Mark Thomson, executive director at Australian emissions consultancy Carbon Transition Pathways, told Recharge at the same time that that blue hydrogen would require 0.1% methane emissions and 96% carbon capture to meet the LCHS — which he described as “barely” possible and not remotely likely.

It is generally considered that SMR is able to capture 80-90% of CO2 emissions, while ATR can reach up to 99%.

Air Products has declined to say which technology would be used at Immingham, but it has said it would use ATR to capture 95% of CO2 emissions at a separate blue hydrogen project in Western Canada, which is due to come on stream in 2024.

It is also worth bearing in mind that the UK’s low-carbon definition also includes upstream methane emissions, which, according to the government’s own documents, leaks at an average rate of 0.8% across the country.

Paul Martin, co-founder of the Hydrogen Science Coalition (HSC), tells Recharge: “It is not practical to generate CO2e (ie, including methane) emissions even close to those achievable by water electrolysis using renewables [ie, green hydrogen], by SMR plus CCS in our view. Even ATR with heavy heat integration and a high capture percentage could achieve this result only from [fossil] gas with exceptionally low source leakage.”

Furthermore, HSC cautions that blue hydrogen projects, even if done very well, should not be considered “transitional”.

“Nobody will build new blue hydrogen plus carbon capture infrastructure unless it is guaranteed to operate for 30 years,” added Martin.

Air Products did not state the planned capture rate for blue hydrogen production at the H3 project, but told Recharge that the post-combustion technology on gas-fired power trains 1 and 2 at the Immingham power plant would capture “approximately 95%” of their carbon emissions.