Green Hydrogen: The Ace Up The Sleeve For Post-covid-19 Recovery

Green hydrogen. Image: Alexander Kirch – Shutterstock.

If deployed on a commercial scale, green hydrogen could be the “holy grail” of renewable energy, combining efficiency and decarbonization.

According to experts, it is time to focus on green hydrogen.

Fatih Birol, director of the International Energy Agency (IEA), said that green hydrogen is ” ready for its big moment , and called on governments to channel their investments for recovery into what is considered the cleanest alternative and efficient to fossil fuels.

The idea of ​​hydrogen as a sustainable fuel for vehicles and power plants has been a topic of debate since the 1970s. However, the biggest problem since then has been the cost of its production, which does not allow its use on a commercial scale. Despite this, proponents of green hydrogen have always argued that investment in infrastructure, as well as increased demand from transportation, gas networks and industry, could reduce their costs.

Some countries, including the Netherlands, Australia and Portugal, have already started investing in this technology. Now, during the coronavirus crisis, investors and companies are pushing for the European Union to define a post-crisis recovery plan to support green hydrogen in sectors such as transportation and heavy industry.

If today most of the hydrogen is extracted from natural gas, through a process that produces carbon emissions, there is the possibility of producing a “green” version of the fuel through electrolysis. This technique, if exploited on a commercial scale, represents the “holy grail” of renewable energy for experts.

Green hydrogen could solve many problems. Political interest in this source is due to the possibility of achieving high energy efficiency and decarbonization at the same time.

Jesse Scott, consultant to the think tank Agora Energiewende

Over the past year, various governments, including those of Germany, England, Australia and Japan, announced strategies for hydrogen production. Australia has already allocated $191 million and Portugal plans to build a solar- powered electrolysis hydrogen production plant by 2023. The Netherlands submitted a hydrogen strategy in late March, outlining plans for a capacity of 500 megawatts (MW) by 2025.

The European institutions also seem to be moving in this direction.

We could use the coronavirus pandemic, in which a lot of public money will be needed for the energy system, to move towards a hydrogen economy.

Diederik Samsom, head of the European Commission’s climate cabinet.

In fact, although one of the main disadvantages of green hydrogen is the demand for a large amount of renewable electricity for its production, the good news is that the prices of green energy have dropped considerably in recent years. Therefore, falling renewable energy costs, coupled with an increase in demand, could reduce the price of hydrogen from $6 per kg to $1.7 per kg by 2050. In addition, an increase of Carbon market prices could be a major stimulus.

However, any attempted large-scale deployment – in industry or transportation – would also require significant investment in infrastructure. For example, the energy from an offshore wind farm would have to be connected to an electrolyzer that produces green hydrogen, which would then have to be transported to end users. Europe has around 135 MW of electrolysis capacity but, according to the McKensey consultancy, the green hydrogen projects currently underway could raise it to 5.2 gigawatts.

Royal Dutch Shell and the Dutch gas company Gasunie have revealed plans to build a gigantic wind hydrogen plant in the north of the Netherlands, capable of producing 800,000 tonnes of green hydrogen by 2040. In Germany, the oil refinery of Heide is starting a project that uses wind power and harnesses the country’s abundant water supply to produce hydrogen, in turn using it to produce kerosene.

But a big fear for companies in the green hydrogen sector is that they will not be able to take advantage of the unique opportunity offered by large economic stimulus packages, fearing that governments will favor traditional high-carbon fuel sectors, which have been seen heavily affected by the collapse of energy demand.

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