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Methods of
production
‘Blue’ Hydrogen production
Hydrogen today is predominantly made by conventional SMR of natural gas - as of 2018, around 95% of global hydrogen produced from fossil fuels by steam reforming natural gas.
To be “blue”, carbon emitting hydrogen production must be coupled with Carbon Capture and Storage (CCS) to capture CO2 from the fluegas.
The CCS process can double the overall cost of the plant.
Generally seen as:
- more scalable as the industry expands
- easier to supply to industrial clusters that need to decarbonise quickly
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Distribution
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End use
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Methods of
production
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‘Green’ Hydrogen production
Today, worldwide electrolyser capacity is 20-25GW.
There are two main types of electrolysers:
- alkaline electrolysis cells (AEC) – been available for many years, based on current technology generally lower CAPEX but higher OPEX cost than PEMs
- polymer electrolyte membrane (PEM)
Price premium of ‘green’ hydrogen (up to 3 times more expensive) leading to push for certification.
Challenges of meeting water demands.
Requires expansion of renewables to enable capacity.
Energy vector
Hydrogen can be used to store and move renewable energy production from where it can be generated at very low cost to demand centres where it can be monetised – to overcome intermittency and excess supply of renewable power generation
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DISTRIBUTION
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Blending with the grid
Hydrogen can be blended with natural gas and transported on national gas grids
- there are existing infrastructure and markets to facilitate this
- hydrogen has 1/3 of thermal value so costs involved in switching equipment and reinforcing infrastructure
Ammonia conversion
Hydrogen can also be converted to ammonia for distribution, then converted back to hydrogen at destination
Dedicated hydrogen networks
Government support will be required to build dedicated hydrogen networks.
Ammonia
Half the world’s food production depends on ammonia (for fertiliser production) for increasing crop yield, resulting in a $70 billion market.
Ammonia production is currently highly carbon intensive. The carbon intensity can be significantly reduced where blue or green hydrogen is used in the production process.
Other industrial applications
Hydrogen is a fundamental building block for the manufacture of methanol, used in the manufacture of many polymers.
Refining
Hydrogen is also used for the processing of intermediate oil products in refineries
Heat
Hydrogen can be an alternative fuel for heat-intensive industries (eg. steel production) and for domestic heating.
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END USE
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Power
Electrolysis can be reversed to generate electricity.
Transport
In the energy field, most hydrogen is used through fuel cells which can power most modes of transport on land, in aviation and for maritime vehicles.
Governments may focus on larger applications (eg rail, haulage and shipping) where battery storage is less optimal and recharging more difficult.
