The decarbonisation of heating in Europe — which is responsible for 38% of the continent’s greenhouse gas emissions — is often presented as a straight-up choice between hydrogen boilers or electric heat pumps.
Multiple independent studies have shown that the former will be the most expensive option, and the latter would be the cheapest, with the International Energy Agency recently pointing out that burning green hydrogen in boilers would require five to six times more renewable energy than highly efficient heat pumps to produce the same amount of heat.
Yet this has not stopped some gas distributors from lobbying to convert their gas grids from methane to 100% hydrogen.
The efficiency of heat pumps is a major problem for the gas distribution companies, as if they cannot supply fossil gas to people’s homes in future, and cannot replace it with a cleaner gas, namely hydrogen, then they don’t have a viable business.
Indeed, the German energy-transition think-tank Agora Energiewende declared last month that as there is “no credible financing strategy” for the use of H2 in heating, “gas distribution grids need to prepare for a disruptive end to their business model”.
The issue represents something of a quandary for the European gas lobby — they can’t argue that hydrogen boilers in themselves are good for the energy transition without risking ridicule (although that does not seem to be deterring some gas distributors), but they also can’t say anything that casts doubt on the usefulness of gases to the energy transition.
Europe’s main fossil-gas trade association/lobby group, Eurogas, has settled on a kind of middle ground — to neither talk up or talk down hydrogen boilers; to point out that other gaseous alternatives to hydrogen boilers exist; to say there is no “silver bullet” for decarbonising heating and all options should remain on the table; and to argue that Europe’s power grids will not be able to cope with an all-electric heating system, at least, not without incredibly expensive upgrades.
Like many lobby groups these days, Eurogas paid a consultancy to write a report on their behalf that backs up their claims.
It may be a coincidence, but it seems that every time a lobby group pays a consultancy for a report, that paper ends up saying exactly what the commissioning organisation would like it to say. For example, McKinsey recently compiled a report for the Hydrogen Council, a fossil-fuel-led lobby group, that resorts to warped logic and dubious assumptions to conclude that inordinate amounts of H2 would be needed by 2050, and that roughly 200 million cars would be powered by hydrogen by mid-century.
So the Eurogas-commissioned study by DNV concludes that a gas-focused scenario — which represents a “choice for gaseous energy delivery” — would be €4.1trn ($4.64trn) cheaper for Europe by 2050 than a comparative European Commission study from 2018 that focused on a mainly electric future.
Compare that to a new study by Stanford University professor Mark Jacobson, which states that a US energy system powered entirely by 100% renewables would be 65% cheaper for consumers than business-as-usual.
You would think that the Eurogas/DNV report would provide ample evidence to back up its bold claims, but it makes no attempt to explain its calculations. It does not break down the €906trn figure in terms of the changes needed to the power or gas grids and there are no statements as to how it sees gases being used in the coming decades — yet it does provide evidence that contradicts its own analysis.
The study claims to represent a net-zero scenario, but it explicitly admits that it did not include upstream methane emissions in its calculations — despite the report appendix stating that methane emissions equivalent to 125 million tonnes of CO2 annually would still be emitted in 2050 — more than Belgium’s current annual greenhouse gas emissions.
Other questionable assumptions in the report include the claim that homes can’t utilise heat pumps without highly expensive renovation/insulation, and that average power prices will be almost twice as high in its gas-focused scenario compared to the EC’s electric-focused one — a convenient choice when trying to show that gas will be the cheaper option.
(For the record, the report states that the lower wholesale power price are due to the higher proportion of variable renewables in the EC study “which drives down prices as they have zero marginal costs” — ignoring the fact that most wind and solar power is bought and sold via power-purchase agreements at prices which are generally lower than on the wholesale market.)
And seeing as the Eurogas/DNV report was published in 2020, it does not take into account the massive natural-gas price rises seen in recent months — which analyst ICIS says means that green hydrogen is cheaper to produce in Europe today than both grey H2, made from unabated natural gas and blue hydrogen (grey, but with incomplete carbon capture and storage).
Indeed, the report states that 46% of the hydrogen needed in 2050 would come from blue H2, requiring 493 billion cubic metres (bcm) of natural gas in 2050 — a 25% increase on the 394 bcm consumed in Europe last year, according to European Commission figures.
What did Eurogas’ leaders say?
At the Enlit Europe conference in Milan last week, Recharge separately questioned Eurogas’ two senior leaders — president Didier Holleaux and secretary-general James Watson — on the evidence against hydrogen boilers.
Both quickly pivoted the conversation to more comfortable talking points, such as dubious claims that heat pumps barely work in cold weather and require expensive home insulation.
“When people say the only solution is [the] hydrogen boiler and it's too expensive, I say, ‘have you looked at fuel cells?’ And the answer is no. So why don't you look at what's happened in Japan?” said Holleaux, during the event’s closing session, which was chaired by Recharge.
“Osaka Gas and Tokyo Gas have tens of thousands of customers equipped with fuel cells at home. Fuel cells are first used for heating and as a secondary product, they… use the power for self consumption and they sell excess power to the grid.”
Of course, the stationary fuel cells in Japan use natural gas as their fuel, not pure hydrogen, and emit an awful lot of CO2 in the process.
“I'm not sure that fuel cells will be the solution for domestic heating in Europe,” the Frenchman continued. “But I say, just look at it, see if it works in which condition in which market, you know, having a solution where a lot of domestic homes become power producers during all of winter is not bad from a distribution point of view because at that time of the year the power networks are overloaded. So if you have distributed production, well, you may save a lot of money on your distribution power system.
“So what we are saying is once again, there is no silver bullet. I'm not saying [the] hydrogen boiler will be the silver bullet, [or the] hydrogen fuel cell, [or] biomethane boiler. I'm just saying there are plenty of solutions.”
The same question to Watson, at a different session a day earlier, prompted a similar response.
“The way that we see heating developing is of course a mix, it's not that we see one particular silver bullet,” he said. “One of the things that we notice quite regularly when it comes to these sorts of events is that people see heat pumps as the silver bullet as if this will solve all issues. There's many different types of heat pumps. So what kind of heat pumps are you talking about? We would also see, you know, thermally driven heat pumps. We would also see hybrid heat pumps [which are part heat pump and part fuel cell or gas boiler] and not just talk always about air to air — air to air may not be the best heat pump for every home.
“So I think we need to think more holistically about what kind of technologies you want. So at this stage Eurogas, when it looks to the future, it sees a mix of fuels within the heating sector. Again, that means a mix of technologies. So it's not to say it'll just be heat pumps and maybe some hybrid heat pumps or hydrogen boilers. We don't exclude hydrogen boilers. It's possible that that could work in certain localities.”
Watson also talked about hairdressers in an attempt to explain why people would be willing to pay five to six times more for their heating, if using a hydrogen boiler.
“Getting people to change is really hard, really hard. You think about your hairdresser, how much you love your hairdresser. You don't want to just go off to anybody else to do your hair, do you? Well, you know, the reality is that people are stuck in the ways that they have. People use boilers. They don't love them, they just provide them [with] heat and [hot] water. That's it. It's cheap — well, [there’s] some question on the energy price at the moment, but basically it's cheap and it's affordable for them to do it most of the time. Then you're going to come along and tell them you're going to have to insulate your house. You're gonna have to put a heat pump in, and it costs thousands more.”
As previously stated, these last two assertions are questionable, to say the least.
The aforementioned Agora study says: “Even unrenovated households switching to heat pumps during the 2030s would be approximately €20,000 better off than those on hydrogen boilers after 20 years, with the difference rising to €30,000 for households that combine heat pumps with deep renovation.”
It’s also worth pointing out that there are currently 23 million heat pumps installed in homes across Europe, according to the European Commission, most of which also provide air conditioning — and zero pure-hydrogen heating solutions.
The highest sales per capita for air-source heat pumps in Europe have been in the cold nations of Norway, Sweden and Finland, according to the European Heat Pump Association — a fact that Recharge put to Holleaux during the Enlit Europe closing session.
His aggressive response was to dismiss the truth out of hand. “That's not air-to-air heat pump, I can tell you,” he said, angrily.
Recharge insisted that they were indeed air-source heat pumps.
“They have to complement heating in this case because air-to-air heat pump at negative temperature has a very, very low efficiency.”
According to Agora, air-source heat pumps in sub-zero temperatures operate with an average coefficient of performance (CoP) of 1.5, meaning that for every 100kWh of electricity put into the grid — and after 10% electricity losses in transmission — 135kWh of heat comes out. The average seasonal performance of heat pumps is put at a CoP of 3.
By comparison, a boiler burning green hydrogen would output 61kWh of heat for every 100kWh of electricity put in, Agora says.
And Holleaux visibly fumed when Recharge brought up Agora’s assertion that gas distributors would soon not have a viable business model.
“I have read the report by Agora Energiewende. I would not call that a report. It's just a list of their prejudices,” he responded. “I didn't find any fact on what they say about the gas distribution network. First, in all the report by Agora Energiewende, you will not see anything about biogas as if biomethane doesn't exist. That's why I call it prejudice.
“You know, we in France… consider that the potential for biomethane alone in 2050 is half of the gas consumption we anticipate in 2050. So you can fill up, if you decide to allocate this biomethane to domestic heating, you can fulfil the whole [heating] need of France, just with biomethane. And in this case, you keep the [gas] grid as they are. So it's really a matter of how do you allocate different resources to the different needs.”
He added: “Believe me, if you have air-air heat pump in a cold environment, you will freeze in winter, you will overload the distribution network in winter. And therefore it's not a good solution.”
The previous day, Watson — a former secretary-general of SolarPower Europe — acknowledged that the decarbonisation of heating was a “real controversy”.
“Can you heat homes with hydrogen or should it only be heat pumps? I’ll tell you this, if you look at a substation level, [with] 200 houses on a substation. By our modelling, you could penetrate with the current grid, 30% more heat pumps and 30% [more] electric vehicles before the next heat pump you put in will start having a problem,” he said.
“You have a choice. You can put [in] embedded generation, ie, fuel cells and micro-CHP [combined heat and power], and guess what? That will allow you to increase your heat pumps by about 50%. Or you can dig up all the streets from Brussels to Bari in every city and every town and replace all the low voltage [power distribution lines] with medium or high voltage — at a cost of €1.3trn by 2050. That’s what Eurelectric [Europe’s main power industry trade association/lobby group] is asking for, €400bn a decade — money you don’t need to spend.”
Of course, €1.3trn is a lot less than €4.53trn, and Watson did not state how much converting the gas network to a hydrogen grid would cost.
According to independent analysis, every compressor in the gas network would need to be replaced, steel pipes would risk embrittlement, so may also need to be replaced, and there are question marks over how leaky the joints between polyethylene and copper pipes would be. Methane already leaks from the gas grid, and hydrogen molecules are far smaller.
According to Hydrogen Science Council member Paul Martin, a process engineer with more than 30 years’ experience of handling H2, the gas distribution network would “leak like the devil and need retrofitting to fix those leaks” — including in the pipework in people’s homes, which are often buried under floorboards or inside walls.
Martin tells Recharge that long-distance gas transmission networks would need to be “straight up ripped out and replaced”.
Recharge asked Holleaux if the gas pipes in homes would be able to safely transport pure hydrogen.
He replied: “The true experiences of pure hydrogen at home are few. So I don't know in details. Globally, everything which has to do with the polyethylene network globally is fine with hydrogen. And you need to change the installation inside the home to make sure that it's hydrogen compatible, but let me come back one second on the issue of heat pumps…”
So, in summary, the European gas lobby is working hard to paint a negative picture of heat pumps, does not have a clear picture of what a hydrogen-based heating system would look like — while asserting that it would nevertheless be far cheaper than an all-electric one — and wants to leave the door open for any and every type of gaseous heating solution possible.
Is that a strong enough argument to persuade lawmakers of the need for gaseous heating?
Recharge does not believe so, but an independent analysis comparing hydrogen and electric heating — including the costs of both producing the H2 and power, and getting them into people’s homes —would be extremely helpful.
Although, having said that, if Michael Liebreich, the influential analyst and founder of BloombergNEF, is correct, the entire discussion may be a moot point.
“You’re not going to have hydrogen in your home for safety reasons,” he told Recharge in June. “It’s just not going to be a thing.”
This article was corrected after DNV contacted Recharge to say that the cost savings from its Eurogas scenario would be €4.53trn, not €906trn. The error was caused by unclear wording in the report.