For very good reasons, hydrogen has been put forward as a key enabler of the energy transition, due to its ability to decarbonise highly polluting sectors such as long-distance transport, heating and heavy industry.
Many executives in the power sector argue that all the required hydrogen should be produced solely by renewables-powered electrolysis, and that the alternative — to produce it from fossil fuels with carbon capture and storage (CCS), known as ‘blue hydrogen’ — should not be pursued.
But the chairman of the European Energy Research Alliance (EERA), says such a position is “ridiculous”.
“You need to do both,” Nils Røkke tells Recharge. “The dogmatic view would be that we should just focus on green [H2]... but then you will miss all your emissions targets, I’m afraid, because it would take too long to develop the amount of renewables you’d need to produce hydrogen from [electrolysis].”
Both blue and green hydrogen “should be pursued by vigorous activities”, Røkke adds. “The key thing really is to establish the hydrogen economy [as soon as possible].”
In the long term, however, all hydrogen should be produced from renewables.
“Looking into the crystal ball, I think it's pretty clear that we need to get away from the fossil-fuel society and then it will be hopefully only renewables,” he says.
'Easier to scale up blue hydrogen'
In the short to medium term, blue hydrogen will be easier to scale up than the green H2, Røkke says, adding that the two varieties are not yet competitors.
“These two ways of producing clean hydrogen, they really address different markets,” he explains. “Green hydrogen is used for pilot demonstration projects and it's used now for filling stations for transport, maybe used for some ferries and so forth. And those are uses for hydrogen, which is in the small to medium scale and nothing beats green hydrogen in that area. Because you just need electricity, basically, and you've got hydrogen. So you don't need any pipelines. And the price [received] is much higher.
“Acceptance of price is much higher in that market than it is, for instance, in industry, where we're talking about substituting coal or coke with hydrogen for a steel manufacturer, and you don't need the same purity. There, you really need to have huge amounts of hydrogen.
“Green is megawatt-scale, maybe we can stretch it up to 10MW and you can make it up to 40MW through modules. But blue hydrogen starts at couple of hundred megawatts. And why is that? Well, because these are huge process plants and you need to have the scale to justify the infrastructure for CO2. Or else it doesn't make sense at all because that's so expensive.”
Relying on imported natural gas — or imported hydrogen?
Røkke admits that it is far from ideal for Europe to rely on natural gas for our supply of clean hydrogen for the coming decades — especially due to the reliance on potentially unfriendly countries such as Russia and Qatar — but he says there is no alternative. That is, unless clean hydrogen is directly imported.
“Europe is the largest energy importer in the world and it’s hard to see how it could go to zero imports,” he tells Recharge.
Røkke points to the leaked draft of Germany’s forthcoming national hydrogen strategy, which expects the country to be importing large quantities of clean hydrogen for the foreseeable future — possibly shipped from around the world in vessels powered by liquid hydrogen or ammonia. Similar import plans have been laid out by South Korea and Japan, with Australia keen to become a worldwide exporter of green hydrogen produced in its sunny deserts and windy southern regions.
“I think, inevitably, [Europe] will depend upon external supplies, and the EU should ensure that its energy imports are clean imports. And that will be driven by the ETS [the EU’s emissions trading system] or some kind of carbon pricing. It would be much better to pay a bit more for a fuel in which the emissions are already catered for.”
Blue hydrogen: who would pay for CCS?
CCS has been touted as a potential climate solution for decades, but the high cost of the technology has meant only a handful of small projects have so far been built, with Norway’s Equinor leading the way. After all, capturing and storing the CO2 from oil & gas operations is pure added cost and will always be uneconomic without a very high carbon price.
The price of a large-scale CCS system in Europe, with CO2 pipelines and offshore storage capable of storing millions of tonnes of carbon dioxide, would cost hundreds of billions of euros — too much to be borne by private or even state-owned companies.
Government funding would therefore be required at this “embryonic phase” — preferably through an EU-wide effort such as the bloc’s Projects of Common Interest programme, says Røkke.
Once the necessary infrastructure is built, he adds, business models may develop that would make it “attractive to own and operate such pipelines”.
Røkke believes that the key to building a clean-hydrogen economy will be blue H2, but as he says, “if CCS is not happening, blue hydrogen is not going to happen”.