Advocates of blue hydrogen — produced from fossil fuels with carbon capture and storage (CCS) — are talking “utter rubbish” and pulling the wool over policymakers’ eyes, according to the boss of one of the world’s largest electrolyser manufacturers.
“I’m worried that governments have been sold a pup with blue hydrogen and CCS,” says Graham Cooley, chief executive of UK-based ITM Power, using a British expression meaning “to be tricked into getting something not as good as promised”.
“Not only is it more expensive than green hydrogen [over the medium term], it does not help you with energy storage or assimilate more renewables on the network, and is not a net-zero [emission] technology,” he tells Recharge, pointing out that it is not possible to capture all of the CO2 emissions when creating H2 from methane or coal. A net-zero energy system — such as the UK government has promised by 2050 — will therefore simply not be possible using blue hydrogen.
“Blue hydrogen will always require a methane pipeline, which will always leak,” he adds. Methane is 84 times more potent a heat-trapping greenhouse gas than carbon dioxide over 20 years, according to the UN’s Intergovernmental Panel on Climate Change.
By contrast, green hydrogen — produced by using renewable energy to split water molecules into hydrogen and oxygen inside an electrolyser — is an entirely zero-emissions gas, Cooley says.
ITM Power is currently building a 1GW-a-year electrolyser factory in northern England, which will make the British company the largest manufacturer in the world. The plant will bring down the cost of the equipment through economies of scale, and thus the price of green hydrogen, says Cooley.
Green hydrogen — produced by using renewable energy to split water molecules into hydrogen and oxygen inside an electrolyser — is currently much more expensive than 'grey' hydroge (made from fossil fuels without CCS).
According to analyst BloombergNEF (BNEF), green hydrogen currently costs between $2.50-6.80 per kilogram today, with the IEA putting the current price of grey H2 production at $1-1.80/kg and blue hydrogen (produced from methane with CCS) at $1.40-2.40/kg. But BNEF argues that due to economies of scale and the falling price of wind and solar power, the cost of green H2 may fall as low as $1.40/kg by 2030, and sink to $0.80/kg by 2050.
Clean hydrogen is expected to play a vital role in the energy transition as it is a zero-emissions fuel that can be used for energy storage, heat, transport, and to decarbonise polluting industrial processes such as steel and cement production. It can either be burned to generate energy or turned into electricity directly using a fuel cell.
The chief executive argues that relying on methane to supply the world’s hydrogen will be a dangerous and ultimately expensive proposition.
“The problem with blue hydrogen is that not only do you need a hydrogen pipeline, but you’ll need a methane pipeline, then you’ll need a CO2 pipeline,” says Cooley. “And the only commercial application [for using captured CO2] is improving the efficiency of oil wells, which creates more CO2. So it’s utter rubbish.
“And the other thing about CCS is no-one has ever built a big project. People say nobody really knows what the cost of electrolysis combined with wind power is. Well, I can tell you the costs are more clearly laid out than they are for CCS. What will a CO2 pipeline costs? What will the wellhead cost?
“And who will pay the insurance on the sequestered CO2? The government will end up doing it, and the taxpayer will pay for it.”
Another problem is that blue hydrogen would mean, for example, that Europe will have to continue to rely on natural-gas supply from potentially hostile countries like Russia for decades to come.
“What I don't understand is how the oil & gas industry has been able to convince governments [about the value of blue hydrogen],” says Cooley. “I mean, they've done one good thing, they’ve demonstrated that the only way of getting renewable heat is to have the gas grid that's full of hydrogen. What they've also got away with is convincing governments that the way to do it at volume is with CCS. Whereas actually you need an excess of renewables.”
The European gas sector has pledged to decarbonise by 2050 by switching to biogas and/or clean hydrogen, but it argues that the required scale needed means that blue hydrogen is a far better option that green. It points to an International Energy Agency report that came out last year, which said that replacing the world’s current fossil-fuel hydrogen production of 70 million tonnes a year with green hydrogen would require 3,600TWh of renewable energy — more than the total annual electricity generation capacity of the EU.
But Cooley is not fazed by that, pointing out that a recent Hydrogen Council report showed that green hydrogen production would be cost-competitive with grey H2 — and therefore cheaper than blue — by the end of this decade and will then get cheaper. Electrolysers are also needed to decarbonise the power sector, he says, as they will allow more and more wind and solar power to be added to the grid from projects that might otherwise be unprofitable. This is because, as more wind and solar projects are added to the grid, it will increase the amount of time that renewables supply (on windy and/or sunny days) will exceed demand, pushing wholesale power prices to zero or below and resulting in ever-more frequent curtailment. But if the excess renewable energy could be sold to green-hydrogen producers, it would increase the income for wind and solar project owners.
“You have to do these two things [ie, adding renewables projects and electrolysers] in harmony,” Cooley says.
The solution to both decarbonising the power sector and the gas grid is to simply add more and more renewables — and electrolysers — to the system, he explains.
“As far as I'm concerned,” Cooley tells Recharge, “green hydrogen is a net-zero solution and blue hydrogen is not.”