This is part two of a special report into clean hydrogen demand — this section is about heating buildings and heavy industry. Part one can be found here and part three here

The oil & gas sector argues that hydrogen can be a direct replacement for the natural gas used to heat buildings in many parts of the world, that they could simply pump hydrogen along existing gas networks, with today’s gas-burning appliances swapped out for hydrogen boilers, ovens and stoves.

Yet such a system seems designed to meet the needs of the oil & gas industry, rather than cash-strapped consumers or the climate crisis.

To start with, burning hydrogen results in greenhouse gas emissions — not CO₂, but nitrous oxides that form when the flame reacts with oxygen and nitrogen in the air.

Secondly, converting the gas grid to run on hydrogen — which has smaller molecules than natural gas — would require all underground metal gas pipes to be replaced by polyethylene ones — including those concealed in walls and under floorboards in people’s homes. And every gas valve and compressor in the network would also have to be replaced.

On top of this, the energy needed to pump H₂ around the gas grid would be three times higher than for natural gas.

Then there’s the fact that heat pumps already exist that are almost six times more energy efficient than hydrogen boilers, requiring 150% less primary energy to produce the same amount of heat.

An independent report into hydrogen heating released last month by the London Energy Transformation Initiative (LETI) network stated: “Of note, we have found that the public discourse on hydrogen appears severely unbalanced, with [the] gas supply industry in particular over-selling ‘green-gas’ to policy makers in order to protect their interests.

“The lack of tangible benefits… casts serious doubts on the practicality of a gas switch over.”

Expecting governments or investors to fund a national gas grid upgrade that would require new infrastructure technology unproven at scale “seems unlikely when viewed alongside the alternative of rapidly falling renewable electricity costs (such as wind farms)”, the study adds. “Expecting consumers to pay will unduly penalise those in society least able to pay.”

Or as Martin puts it, somewhat less diplomatically: “When the alternative is to go out of business, people imagine all sorts of things might make sense if it allows them to stay in business.”

The oil sector is also pushing to add clean hydrogen into fossil-gas networks in order to reduce emissions, with a 10-20% hydrogen blend not affecting grid operation or gas appliances. It claims that this would increase demand for clean hydrogen massively, leading to huge cost savings through economies of scale.

But there are two problems with hydrogen/gas blending.

Firstly, clean H₂ is far more expensive than natural gas, so it would almost certainly push up prices for consumers and therefore be extremely unpopular.

Secondly, studies show that burning hydrogen-enriched fossil gas actually produces more nitrous oxide than combusting natural gas alone.

Hydrogen for heavy industry

Clean hydrogen has long been touted as a definitive method of decarbonising the high-temperature heat required by heavy industries such as steel, cement and concrete, which currently rely on natural gas, coal or coke.

But as Agora Energiewende analyst Gniewomir Flis tells Recharge: “The idea that high-temperature process heat can only be decarbonised with hydrogen is a marketing ploy. In most instances, electric heating is just as viable, and could be even more efficient at decarbonising high-temperature industrial heat than hydrogen. But there is space for the two to work side by side.”

A scientific paper by a group of climatologists, led by Silvia Madeddu from the Potsdam Institute for Climate Impact Research, last year analysed energy use in 11 industrial sectors in Europe, which accounted for 92% of heavy industry CO₂ emissions. It concluded that 78% of the energy demand is “electrifiable with technologies that are already established, while 99% electrification can be achieved with the addition of technologies currently under development”.

Several high-temperature electric-heat technologies are already in commercial operation in industries such as ceramics, cement, metals, chemicals, plastics and food processing. These include compression heat pumps, electric boilers, infrared heaters, microwave and radio-frequency heaters, induction furnaces, resistance furnaces, electric arc furnaces and plasma technology. And most of these produce temperatures of more than 1,000°C.

Electric-arc furnaces, it points out, already accounts for 40% of European steel production (by melting scrap steel).

“There are two further reasons why electricity, and not hydrogen, should be the economically preferred source for industrial heat,” writes Liebreich.

“The first is that last-mile distribution of electricity is much cheaper and safer than last-mile distribution of hydrogen.

“The second arises from a fascinating corollary of Madeddu’s work: fully one third of industry’s energy use is wasted between ‘final energy’ (eg, energy input into a boiler) and ‘useful energy’ (eg, energy output from that boiler)... electrical industrial heating can simply be more efficiently targeted and managed than combustion.”

He adds that hydrogen could have an advantage in batch processing, which requires large amounts of energy in short bursts. Electric solutions could “cause voltage or frequency problems, necessitating the upgrading of the power grid”.

But Liebreich continues: “It’s a fight that green electricity should generally win. It is cheaper per unit of heat, cheaper to deliver, and better at enabling end-use efficiency.

“Imagine the potential prize for countries or companies that don’t waste resources on hydrogen, but focus instead on developing electrical solutions for heat in different industrial processes.”

Steel

Steel production is slightly different to other industries that need high-temperature heat. The reason why coke has been used for more than a century to smelt iron ore in blast furnaces is because it acts as both the fuel and the reducing agent to remove oxygen from the ore — which is required to produce high-quality steel. Using electric heat alone is therefore not an option.

Yet hydrogen can also provide heat and oxygen removal in a production method called direct reduced iron (DRI) — a process that currently accounts for 3% of the hydrogen produced globally every year, according to the IEA.

The only technological roadblock preventing the steel industry from switching from coke to H₂ is “the availability of sufficient amounts and also the price of green hydrogen”, Alexander Fleischanderl, a technology officer at engineering firm Primetals Technologies, told Carbon Brief.

McKinsey’s recent hydrogen report stated that green steel will become cost-competitive with coke-derived steel in Europe in the 2030s.

But hydrogen is not the only option for green steel, and it might not be the cheapest in the medium to long term.

There are two experimental processes being developed that use electricity directly to separate iron and oxygen from in iron ore.

The first, called electrowinning, which is being tested by ArcellorMittal and partners, runs an electric current through an electrolyte solution containing finely ground haematite (an iron-containing mineral in iron ore), with oxygen gas attracted to the anode and iron deposited on the cathode.

The other process, called molten oxide electrolysis (MOE), is being developed by US start-up Boston Metal, which counts Bill Gates-backed Breakthrough Energy Ventures among its investors and has even been cited by Nasa as a way to produce oxygen on the Moon.

The process is similar to electrowinning but involves heating a liquid iron oxide electrolyte to temperatures of up to 2,000°C, and using electrodes capable of withstanding such temperatures. Again, oxygen is released in bubbles by the anode, with molten iron forming at the cathode.

Boston Metal believes steel could be produced using MOE at a fraction of the price of coke-derived steel and therefore much cheaper than hydrogen-derived green steel.

Replacing grey hydrogen

When all is said and done, there is only one area where large-scale use of clean hydrogen is 100% guaranteed — to replace the current industrial use of grey hydrogen.

According to the IEA’s 2019 Future of Hydrogen report, 70 million tonnes of pure hydrogen (almost all of which is grey) is produced every year for industrial purposes — 33% of which is used in oil refining (mainly to remove sulphur from crude oil); 27% for ammonia production (mainly used to produce ammonia fertilisers), 11% for methanol production (an important feedstock in the chemicals industry), and 3% is used in steel production.

The IEA says that every tonne of grey H₂ produced from natural gas and coal gasification results in ten and 19 tonnes of CO₂ emissions, respectively. Annually, hydrogen production releases 830 million tonnes of CO₂ into the air — the equivalent of the combined carbon emissions of the UK and Indonesia.

Switching to green or blue hydrogen would therefore make an enormous difference to the global climate effort.

And this is not a small market for the clean-hydrogen sector. Producing 70 million tonnes of green hydrogen per year would require almost 900GW of dedicated offshore wind projects, or more than 2,000GW of dedicated PV, according to Recharge calculations.

And if the world is to meet the total hydrogen demand in 2050 — at least 133.8 million tonnes a year — from renewables-powered electrolysis, the industry will need to roughly double these figures.

By way of comparison, only 580GW of PV and 28GW of offshore wind had been installed by the end of 2019, according to the International Renewable Energy Agency.

“Just replacing the H₂ we’re making [today] from fossils... is a positively staggering task,” Martin wrote in a recent LinkedIn post. “Not impossible, but very, very difficult to imagine.”

This is why blue-hydrogen advocates argue that renewables could never provide enough power to decarbonise the electricity, heating and transport sectors by 2050 — and that blue H₂ is therefore needed at scale. But that is an argument for another day.

As Chris Stark, chief executive of the UK’s Climate Change Committee, wrote, tongue in cheek, on Twitter last year: “I see we’re back to debating hydrogen vs electrification again. Here’s a secret from the CCC’s big fancy net zero computer model: we need lots of both.” 

This is part two of a special report into clean hydrogen demand — this section is about heating buildings and heavy industry. Part one can be found here and part three here

Energy Transition

SPECIAL REPORT | Is hydrogen the best option to decarbonise heating and heavy industry?