A recent journey on the London Underground inspired insights into the evolving hydrogen sector and the significance of the “squiggly” journey.Continue reading
By Simon Cleghorn, global product specialist, W. L. Gore & Associates
Without a doubt, hydrogen is critical to our clean energy future, and as a major downstream application of hydrogen, fuel cell technology is gaining maturity by the day. So much so that at W. L. Gore & Associates (Gore), hydrogen drives our global vision of a low-carbon, sustainable energy system. And nowhere is this more obvious than in the transportation sector, a key player in the adoption of hydrogen as an energy source.
Instrumental to realizing this future potential is the proton exchange membrane (PEM) fuel cell stack, this utilizes a membrane technology that with the right expertise can accelerate the commercialization of FCEVs by dramatically improving the performance and reliability of fuel cell stacks and systems.
Currently, there are two technologies that can reduce the carbon footprint of transportation: fuel cell electric vehicles (FCEVs) and battery electric vehicles (BEVs).
With a fast refueling time of 3-5 minutes, extended range of over 400 miles, and a quickly expanding available hydrogen infrastructure, fuel cell powered vehicles are gaining incredible amounts of traction in and opening up new possibilities for the future of mobility.
Looking more deeply into the various types of fuel cell technologies, proton exchange membrane (PEM) fuel cells offer many promising possibilities for automotive applications. So let’s take a look at some of the many benefits, and reasons why the PEM fuel cell stack system is a great solution for vehicles.
Compared to solid oxide fuel cells (SOFC) and direct methanol fuel cells (DMFC), the hydrogen PEM fuel cell offers high power density, low weight and volume, and an attractive operating temperature window that does not require preheating before operation (Figure 1).
This enables automakers to offer a broader portfolio of fuel cell powered products – from passenger cars to commercial vehicles to long-range logistics trucks. This superior versatility has enabled PEM fuel cell stacks and systems to account for 64% share of the fuel cell market (Figure 2).
The potential benefits of PEM fuel cell technology make it critical for automakers to invest. However, the technology must be commercially viable and competitive to achieve economies of scale. So to gain widespread acceptance, fuel cell stack engineers must partner with membrane technology experts and together optimize the PEM, stack, and system to realize the commercialization needs for FCEVs in three broad categories:
- Reliable performance – Understand PEM’s power density and durability characteristics and how to leverage membrane technology for optimal performance in the stack and system.
- Technical support – Ensure fit-for-use solutions, technical expertise, and service support to meet vehicle program objectives.
- Supply security – Maintain a reliable supply chain of hydrogen fuel components and materials to achieve quality, consistency and scalable production.
The PEM in a fuel cell separates hydrogen from air (oxygen), transports protons from the anode to the cathode, and prevents electrons from short-circuiting in the cell. This makes the PEM an essential component of hydrogen- to-energy conversion in the fuel cell. To operate reliably and provide excellent performance under high temperatures and potentially dry conditions, PEMs in an automotive fuel cell stack must have high proton conductance (enabling power density), be resistant to chemical degradation and mechanical failure, and demonstrate low gas permeance.
Utilizing thinner PEMs, engineers can reduce proton resistance while increasing water transport, and improving performance, especially at low RH (Relative Humidity). However, traditionally thinner PEMs can impact mechanical properties and therefore compromise the fuel cell’s life.
In addition, thinner PEMs can result in increases in gas crossover and lower fuel efficiency, as well as increased concentration of harmful radicals that accelerate chemical degradation, leading to decreased product lifetimes.
These tradeoffs can be significantly reduced by micro- reinforcing the PEM with expanded polytetrafluoroethylene – or ePTFE. Developed from decades of materials engineering experience, Gore’s composite reinforced PEM technology is based on a combination of highly engineered ePTFE, high- performance ionomers, and proprietary membrane additives to combat chemical degradation. The result is a low resistance and durable product design for specific application requirements (Figure 3). Continued R&D efforts in PEM materials and designs, as well as fuel cell stacks and systems, must take a holistic approach to understand their interactions and tradeoffs to optimize the performance and cost of the end application.
New and different product requirements arise as we move from PEM research and development to production and commercialization. PEM suppliers must have the technical expertise and knowledge to support the customized, fit-for-use needs of automakers.
It is important for a component supplier to possess a deep understanding of the potential performance tradeoffs of their component and the potential interactions with other components in the fuel cell stack and system. In the case of the PEM, Gore has developed both modeling, in-situ (in fuel cell) and ex-situ test methods to enable understanding of these interactions and accelerate product design.
Critically, leading PEM suppliers should be able to perform in-situ electrochemical analysis (in fuel cell) to determine the cause of low performance and/or power loss over time that could result from changes in material. Ex-situ postmortem analysis tools should be readily available to automotive suppliers to diagnose the failure modes and mechanisms of field- returned MEA/PEM stacks.
To complete the picture for holistic technical support, PEM suppliers should have comprehensive global analysis resources to support surface science investigations, thermal, mechanical and physical characterization, chemical analysis, and microstructural characterization for complex problem solving.
As automakers move to mass production of fuel cells, PEM manufacturers must ensure high production yields with consistent high-performance products – while minimizing product costs and quality risks. PEM suppliers with consistent raw materials and precision membrane coating technology can ensure uniformity and quality by minimizing cell-to- cell variability (Figure 4). This allows fuel cell stack manufacturers to precisely control performance distribution both within-cell and cell-to-cell in the stack. Resulting in increased stack production yields and lower costs, as well as improved stack lifetime.
Another important consideration is the supply of raw materials. Few PEM manufacturers have established, proven and reliable raw material supply chains based on extensive R&D collaborations and secure commercial partnerships with sub-suppliers.
It is even more difficult to find suppliers who can produce high- performance PEM in the quantities needed to meet industry demand. Understanding this as crucial to success, Gore leverages its ePTFE reinforcement expertise and global network resources to ensure the security of supply, process stability, and quality consistency at scale.
Making fuel cell technology commercially viable for freight transportation and beyond
Today fuel cell technology is being effectively developed, deployed, and tested in FCEVs for passenger vehicles. Great news, because these advancements and learnings are paving the way for the many benefits of PEM technology in other transportation industry sectors. Making fuel cell technology commercially viable for freight transportation industry too.
Fuel cell system developers in commercial application are now looking to similar collaborative models to scale their technology based on advancements in Gore’s PEM technology.
And the benefits are clear – trucks that run on clean hydrogen power can use lighter fuel cell stacks, giving them greater payload capacities and improved efficiencies, resulting in reduced total cost of ownership, critical performance indicators in a highly competitive industry.
In summary, we believe that fuel cell stack engineers must partner with membrane technology experts to realize the PEM, stack and system commercialization needs for FCEVs in three broad categories: reliable performance, expert technical support, and having supply security – enabling automakers of all types to be ready for a hydrogen-powered future.
If you wish to learn more about Gore and its GORE-SELECT® Membrane technology, please visit https://www.gore.com/alt-energy.
W. L. Gore & Associates
W. L. Gore & Associates, a supporting member of the Hydrogen Council, is a global material science company that transforms industries and improves lives. Throughout its history, Gore has solved complex technical challenges in the most challenging environments – from outer space to the world’s highest peaks to the human body’s inner workings. It currently generates $4.5 billion in revenue annually, with more than 12,000 employees.
To decarbonise the global economy as quickly, effectively and cost efficiently as possible, we need international trade of hydrogen to link sources of cheap renewable energy with areas of high demand. This is the focus of the Council’s brand-new report, Global Hydrogen Flows, released in October.Continue reading
Hydrogen took another step up with COP27. Here, Daria Nochevnik and Daryl Wilson share their reflections.Continue reading
This article was first published in World Oil.
By Daryl Wilson, Executive Director of the Hydrogen Council.
The global energy crisis is squeezing consumers and businesses alike. As household bills rise, governments are competing over a limited supply of gas, the price of which is rising every day. With investors pouring more and more into hydrocarbons to meet this newfound demand, many have voiced concerns over the direction of the global energy transition. However, the interest and investment in the hydrogen sector shows there is real progress being made in renewables, and that despite current market challenges, hydrogen will play a major role in global energy in the near future.
The history of global energy can, in many ways, be viewed as a long journey of decarbonization, from wood, to coal, to oil, and then to natural gas. Over time sources have become cleaner and more efficient. Hydrogen is the obvious last step on that path, a clean energy source, with no significant environmental impact.
Last October, a Hydrogen Council report showed that hydrogen can provide the lowest-cost decarbonization solution for 22% of final energy used by 2050, roughly equivalent to the role electricity takes in today’s global energy mix. While hydrogen would by no means be a panacea, it clearly has the potential to play an essential role in the energy transition.
There are a wide range of fields that hydrogen can support to reduce emissions, from heavy industry, transportation, and decarbonizing ammonia for food and agriculture.
Hydrogen will also open up opportunities for regions richly endowed with renewable energy sources. Chile, Australia, and a number of African countries, strong in wind and solar power, will be able to make a much bigger contribution to the global energy mix than before, as hydrogen will allow them to export their excess renewable energy further afield, becoming major producers in the process. This in turn will boost their economies, providing growth and jobs.
This is the ideal scenario for hydrogen, but to get there a lot has to happen. To get to 22% of global energy, the means of producing hydrogen have to be massively scaled up, not only to meet demand but to reduce costs.
Critics of hydrogen like to claim the technology is not competitive against standard fuels, but they forget that oil and gas have had a hundred-year head start, and as the hydrogen sector grows, and it is growing, this advantage will decrease.
There has already been an increase in the size and number of hydrogen projects over the last year. More than 700 projects have been announced, which is a quarter of the total required to meet anticipated demand by 2030. However, the number of hydrogen projects (in terms of demand) will need to grow 4x to be on the right trajectory.
In the past few months, through the swings of the energy market and policymakers’ concerns over energy security, the investment community has shown more interest in hydrogen. Traditionally projects have largely been captive within existing companies, and there has not been a broad open market for financing hydrogen infrastructure finance. But that is now changing, as investors look for ways to supercharge projects, or develop new ones.
The challenge for the industry and lawmakers, will be to create an environment that can make the best use of this newfound appetite. The industry will need to find a way to de-risk large scale projects, and educate key stakeholders about the timelines and potential of the technology. For example, critics often claim hydrogen is not deployed at scale, but this is misleading. Hydrogen is in use on a massive scale in global refining operations and in the manufacturing of ammonia. The issue is, hydrogen’s greatest successes are industrial, and the industry will need to show how the same benefits can be applied to the public domain, in automotive transports like cars, and in our utility systems.
As the industry moves its technology into this domain, it can then bring with it the codes and standards it has implemented in the industrial process to guarantee the same levels of efficiency.
A viable model is already apparent in Chile, which produces economically profitable hydrogen, largely carrying solar and wind energy, at a low cost. Low renewable energy costs will determine who leads the global hydrogen industry, and Chile may well be a viable model for many renewable rich countries.
Over the last two years, the number of hydrogen projects has grown massively, and the next five years will be no different. To keep this growth up however, the industry will need to keep engaging policymakers and partners up and down the value chain, both through public partnerships and on a more ad-hoc basis at major industry conferences like ADIPEC 2022.
This is an exciting time for hydrogen, at a crunch point for the global energy sector, hydrogen can offer hope and security, it just needs the right investment.
This article was first published in H2 View.
By Daria Nochevnik, Director of Policy and Partnerships, Hydrogen Council.
The RePowerEU plan published on May 18, following the European Commission communication of March 8, reinforces Europe’s commitment to rapidly reducing, and ultimately getting rid of, its dependence on Russian fossil fuels.
As part of the plan, alongside a suite of measures to diversify gas supplies in the short-to-medium term, as well as to remove bottlenecks around licensing and permitting for renewables, the commission laid out its vision for a Hydrogen Accelerator. The key target under the accelerator initiative is to use 20 million tonnes (mt) of renewable hydrogen in the EU by 2030, out of which 10 mt are to be produced within Europe and another 10 mt imported from third countries.
According to commission estimates, using 20 mt of renewable hydrogen in the EU in 2030 would displace up to 50 bcm – or up to a quarter – of Russian natural gas imports.
In the words of the European Commission President Ursula von der Leyen, “The quicker we switch to renewables and hydrogen, combined with more energy efficiency, the quicker we will be truly independent and master our energy system1.”
The renewable power and hydrogen ambition set out in the RePowerEU plan is strong but how much system thinking is there across the underlying legislative measures? And are these underlying measures fit for purpose to unlock Europe’s hydrogen and renewable power potential?
Policymakers in Europe have been doing their utmost to respond to the immediate threat to the EU’s energy security. Yet making sure that short-term measures do not create inefficient outcomes in the longer run is a challenge.
By now, nearly everyone in the hydrogen world has heard of the concepts of additionality, geographical and temporal correlation set out in the proposed EU rules for qualifying hydrogen production as renewable for the purposes of compliance with the future EU-wide renewable hydrogen consumption targets2. At the same time, many have been struggling to figure out how exactly these qualifications will be applied in practice, both for renewable hydrogen produced in Europe and that imported from third countries.
For example, electrolysers connected to the grid would need to evidence that they are powered by unsubsidised renewable electricity and demonstrate the matching of renewable electricity with renewable hydrogen production on an hourly basis (otherwise the hydrogen produced would not be considered as renewable).
Aside from the fact that hourly GOs exist in very few countries in Europe and globally, the stringent requirements placed on electrolysers beg the question: why is the role of hydrogen in enabling indirect electrification restricted?
Direct vs indirect electrification – why should we have ‘either/or’ and not both?
Imagine you purchase an electric car and to receive a tax benefit you need to qualify your rides as ‘renewables-based’ and evidence on an hourly basis that you are charging your electric vehicle with strictly renewable electricity. Side note: in 2021, power sector emissions in Germany were estimated at 349g CO₂/KWh of electricity generated3.
Following a similar logic, large data centres would have to be built strictly in countries whether the grid mix is already nearly fully renewable (there are only three in Europe – Sweden, Austria and Norway). Side note: data transmission networks consumed 260-340 TWh in 2023, or 1.1‑1.4% of global electricity use4.
Some suggest that direct electrification should be the priority, regardless from whether/the extent to which the electricity used is renewable, as renewable electricity capacity will increase. Yet this perspective neglects the complementary role of indirect electrification that can be achieved thanks to hydrogen deployment. Renewable hydrogen allows integrating greater renewable energy capacity in the system while:
- Helping alleviate grid constraints (in Germany alone nearly €1bn of taxpayers’ funding was spent last year on curtailed renewable power)
- Offering flexibility to the power grid
- Allowing to make use of existing infrastructure endowments (repurposing gas pipelines for hydrogen use) to transport large volumes of renewable energy over long distances in a cost-effective manner
- Enabling energy consumers for whom direct electrification is not a viable option (heavy industry) to decarbonise.
To get the chance to succeed in our race against climate change, we need both solutions – direct and indirect electrification – as they are complementary to each other.
Having a preference for one over the other is a policy choice and a way to pick winners. Yet there are no one-size-fits-all solutions for all geographies and end-users, and there will ultimately be no winners if we don’t deliver on
our climate commitments fast enough.
Will renewable hydrogen have a future in Europe?
The concept of additionality in itself is integral to hydrogen deployment. The ramp up of renewable hydrogen goes hand in hand with the development of new/additional renewable electricity capacity in Europe and globally.
However, the way in which it is proposed to apply additionality to renewable hydrogen in combination with geographical and temporal correlation puts in question the future of renewable hydrogen in Europe, let alone Europe’s ability to achieve the targets laid out in the Hydrogen Accelerator initiative.
The conclusions from modelling the application of these criteria to some of the real-life project proposals are despairing. Not only would the cost of renewable hydrogen double (or in some cases, more than double), the load factors of electrolysers would be prohibitively low – in other words, the business case for electrolysers will be de facto jeopardised.
What about renewable hydrogen imported from third countries? Prospective exporters struggle to see how they could meet the required qualifications specific to the EU energy market design. The proposed rules fail to recognise the differences in energy market design and market infrastructure endowments in third countries, from which renewable hydrogen may be imported (where power pricing is not zonal, for example). In addition, one should consider that market infrastructure is at different stages of maturity across the prospective exporting countries, including those in North Africa (the first PPA was signed in Egypt only in 2020).
Another major barrier for prospective exporters of renewable hydrogen and derived products is indeed the requirement to have renewable hydrogen subject to ‘effective carbon pricing’. Let us not forget that the EU cap and trade system (EU ETS) had teething issues. While it was set up in 2005, one may argue that it really started delivering only towards the end of the last decade – it took it more than 15 years. While a number of jurisdictions outside the EU are looking at introducing cap-and-trade systems/carbon taxes, the adoption of these instruments is a lengthy legislative process.
The above requirement would preclude imports of renewable hydrogen or derived products from third countries with abundant renewable power resources due to the absence of carbon pricing in their respective jurisdictions.
Watershed moment for the EU energy system
The EU still has the chance to review renewable hydrogen qualifications and make them fit for purpose. A pragmatic approach embracing both direct electrification through renewable power and indirect electrification through hydrogen can be a true game-changer for Europe.
The RePowerEU plan offers Europe a unique opportunity to unlock its renewable electricity and hydrogen potential and reap decarbonisation, energy security, cost-efficiency and resilience benefits, and ultimately – to master its energy system. Will Europe take it?
- European Commission President Ursula von der Leyen’s address at the press conference on the RePowerEU communication, 08 March 2022
- The Delegated Acts on Renewable Fuels of Non-Biological Origin (RFNBO) that were due to be developed by 31 December 2021 as per Art. 27(3) and Art. 28 (5) setting out the methodology for qualifying electricity used for RFNBO production as renewable and the methodology for assessing the GHG emissions savings from RFNBO respectively
This article was first published in Innovation News Network.
Stephan Herbst and Juergen Guldner, on behalf of the Hydrogen Council, discuss the advantages of deploying both battery and fuel cell electric vehicles.
The transportation sector is responsible for about 24% of global CO2 emissions.1 Decarbonising it will require perhaps the most significant transition in the industry’s history. Despite the challenge, it is essential to tackle this to reach carbon neutrality at a global level.
Two electric mobility technologies, powered by batteries and hydrogen fuel cells respectively, have emerged as commercially viable solutions in different market segments that can help us transition to clean mobility. However, these solutions are often competing with each other rather than being complementary. This reductive dichotomy must be challenged by industry, governments, and the public broadly if we are to achieve our shared climate goals.
Many industry leaders are committed to a vision of decarbonising transport through a ‘combined world’ approach – a range of solutions including both fuel cell electric vehicles (FCEVs) and battery electric vehicles (BEVs). They are mobilising unprecedented investment to bring both solutions to the market because they believe that working together will make our transportation greener and will do so faster and cheaper than just one technology alone.
The advantages of deploying both BEVs and FCEVs
Firstly, deploying both BEVs and FCEVs in tandem maintains the flexibility and choice for consumers across all transportation sectors. The optimal choice between BEVs and FCEVs is dependent on location and end use. By having both available, we can meet the expectations of consumers and owners who are looking to optimise value. The better we address the needs and expectations of customers, the faster they will adopt these clean solutions.
Secondly, from a systemic perspective, BEVs and FCEVs are remarkably similar in efficiency when starting at the source of energy – be it solar or wind. However, BEVs are not a viable option for all regions and applications, and hydrogen can fill that gap. Hydrogen can be produced in regions with abundant renewable generation and shipped to areas struggling to reach renewable self-sufficiency, thereby expanding the penetration of renewables throughout the global economy.
Finally, the synergies between BEVs and FCEVs continue into the development of the related charging or refuelling infrastructure. Whilst conventional wisdom is that a single infrastructure is cheaper than two, data shows that developing two infrastructure networks is more cost-efficient. This is because hydrogen refuelling can reduce the peak load and bring large amounts of energy into relatively remote areas that have critical transportation needs, all whilst minimising the otherwise necessary and extremely costly upgrades or extension of the electric grid.
Collaboration is needed to decarbonise transport
We are convinced that both technologies are needed. We know that the transition to decarbonised transport is just getting started. Even with the high growth of BEV sales in recent years, 98% of passenger vehicles and virtually 100% of commercial vehicles on the road are still powered by combustion engines. BEVs and FCEVs are contributing to the same goal: decarbonising the global fleet. Every BEV and FCEV on the road is a step in the right direction.
Moving to zero emission transportation presents many challenges, but it can be accomplished when the industry and government are focused on the goal and work together. We have not just one but two commercially viable options at our disposal that can accelerate and de-risk the transition whilst keeping costs down. Pursuing both FCEVs and BEVs in parallel fosters innovation and progress. In the race to save the planet from global warming, we must pursue both pathways to succeed.
- IEA, Transport Improving the sustainability of passenger and freight transport, https://www.iea.org/topics/transport
Technical Head Powertrain Hydrogen and Fuel Cell Business Unit
General Manager Hydrogen Technologies and Vehicle Projects
This article was first published in H2 View.
By Daryl Wilson, Executive Director of the Hydrogen Council.
The transition to a clean energy system will require massive change. For the world to stay on the path towards net zero emissions by mid-century, global hydrogen demand alone should grow to 140 million metric tons (MT) in 2030 and 660 MT in 2050 – up from 90 MT in 20201. And while the necessity of change is clearly recognised today, the scale and complexity of actually making it happen aren’t so easy to fathom.
While most people can already visualise some elements of the future system, such as solar panels, wind turbines, or battery-electric vehicles, the hidden layers that serve the system are sometimes overlooked, but this is where the secret of systemic change lies for the energy sector. Pipelines, tankers, and oil and gas fields handle massive energy flows across large distances every day, taking energy from where there’s plenty to where there’s not enough. In the future global clean energy system, which integrates renewables and electricity, hydrogen will play a critical, complementary role. However, this will depend on building new and retrofitting and repurposing existing infrastructure, as well as creating the trade flows to transport hydrogen via pipelines and shipping around the world.
We know some regions such as Latin America, the Middle East, and Northern Africa have the potential to produce more clean hydrogen than needed for domestic use because of their natural endowment for the generation of renewable energy. Meanwhile, places like Japan and Korea with insufficient renewable sources will need to import most of the 35 MT of hydrogen they require in 20502. For the first category of regions to reap the economic benefits of their export potential, and for the latter to ensure they can get sufficient clean energy from elsewhere, industry, investors and governments need to take action to tackle the challenges of hydrogen transportation, import and export.
Choosing the suitable form to transport hydrogen
From liquefied hydrogen over ammonia to liquid organic hydrogen carrier (LOHC), the different forms each have their own benefits and challenges, and the preferred form depends on the end use3. Demonstration projects at scale are key to assess the cost and design requirements for different hydrogen carriers, and commercialise the technology. Industry frontrunners are already leading the way, a prime example being Kawasaki Heavy Industries’ liquefied hydrogen carrier, the Suiso Frontier4. Like the first oil tanker sailing from North America to Europe in 18695 and the first LNG shipment in 19596, the first shipment of bulk liquified hydrogen on the seas carried out by the Suiso Frontier earlier this year is a historic accomplishment, with the potential to radically change our energy trade flows.
Getting the right infrastructure in place
Exporting or importing large amounts of hydrogen requires appropriate ports, logistics and infrastructure. In regions with the right conditions and ambition to develop into demand hubs, big investments need to be made to develop a fully-fledged hydrogen import chain: new import terminals, storage and distribution infrastructure. This decade is a critical period for scaling up shipping of hydrogen; but infrastructure building needs long lead times, meaning projects need to kick off now.
Developing international standards and certification systems
Cross-border trade needs a common language. The absence of harmonised standards and certification systems for assessing and evidencing hydrogen’s sustainability attributes is an unnecessary barrier to investment. By eliminating inconsistent rules and methods to determine hydrogen’s carbon footprint, countries can provide certainty to buyers about hydrogen’s origin, offer more clarity on hydrogen’s contribution to decarbonisation goals, and reduce administrative costs. To illustrate, in Japan, such a reduction of the administrative burden on hydrogen import from Australia could generate up to $2bn of savings in 20307.
More and more governments, businesses and investors understand that massive changes in our energy system require a versatile energy vector to move large quantities of clean energy around, and hydrogen is the ideal candidate to do that job. Australia is just one example of a country with ideal natural conditions for renewables, which has already signed hydrogen trade agreements with Japan, South Korea, Singapore and Germany – all countries which recognise that international cross-border shipments of energy will still be required in the clean energy system of the future.
The Hydrogen Council is working to highlight the challenges and opportunities in the energy transition and build understanding around the practical and impactful role that hydrogen can make as part of the necessary systemic change. Together with our international partners, we are also facilitating the development of common international standards, alongside robust and tradeable certification systems for hydrogen to build consumer trust and foster global hydrogen trade. If we get the enabling policy frameworks and tools in place and sufficient financial support for the necessary infrastructure, hydrogen will soon be ready to set sail at scale.
This article was published in the March issue of H2 View magazine.
1.“Hydrogen for Net Zero”, Hydrogen Council, November 2021
2. “Hydrogen for Net Zero”, Hydrogen Council, November 2021
3. “Dawn of a new age: First seaborne liquefied hydrogen shipment underway”, IHS Markit, 28 January 2022
4. “World’s First Liquefied Hydrogen Carrier SUISO FRONTIER Launches Building an International Hydrogen Energy Supply Chain Aimed at Carbon-free Society”, Kawasaki Heavy Industries”, 11 December 2019
5. “July 30, 1869: Moving Oil in Bulk, for Good and Ill”, Wired, 29 July 2008
6. “Methane Pioneer”, Wikipedia
7. “Hydrogen Policy Toolbox”, Hydrogen Council, November 2021
This article was first published in H2 View.
The movement of people and goods throughout society has always depended on more than one technology. Different individuals, businesses, geographies and segments of the transportation system have different needs and no single solution can meet all of them alone.
This continues to be true as we look towards a clean mobility future.
We are convinced that reaching net zero in global transportation is not a zero-sum, single solution game. Instead, we need a combination of technologies with different strengths – namely battery electric vehicles (BEVs) and fuel cell electric vehicles (FCEVs) – to create a system that is greener, and to do so faster and cheaper than pursuing just one of these options in isolation.
There are three primary reasons for this “combined world” approach:
First, efficiency: a tank-to-wheel perspective, sometimes used to compare BEVs vs. FCEVs, is too narrow to truly encompass the global challenge we are up against. If we are to deliver on a comprehensive energy transition, we need to consider the source of energy, whether sun or wind. BEVs can be easily charged with local solar and wind resources, but not all regions enjoy renewable electricity self-sufficiency. This is where hydrogen can play a positive role. Because hydrogen can be transported across regions, it can be produced in ideal locations with high solar and wind output and then exported where needed. A sun-to-wheel or wind-to-wheel perspective changes the efficiency debate entirely. The same holds true when the entire life cycle of a vehicle is considered rather than purely the tank-to-wheel efficiency: BEVs and FCEVs are almost compatible.
Second, infrastructure: the development of BEVs and FCEVs with their respective infrastructure networks will create a symbiotic transport ecosystem, which enables a more rapid and – perhaps surprisingly – more cost-effective transition. As more BEVs are deployed, the demand on the electricity grid will require costly upgrades and expansion into more remote regions. These costs can be reduced by decreasing the demand on the grid through parallel buildout of a hydrogen refuelling network.
For example, the scale of infrastructure investment for fast charging is obvious for highway refuelling. The massive energy consumption of heavy-duty trucks will need to be recharged during the drivers’ resting times to be commercially feasible. In practical terms, that means the power consumption of each highway charging station would need to equal a town of approximately 25,000 inhabitants, which needs to be provided in remote areas with sufficient buildout of cabling and substations. This is exactly where hydrogen can help.
Last but certainly not least, consumers: context and location of vehicle use is one of the key considerations in the transition to electric mobility. A suburban commuter in a single-family home with parking and charging access will be well served by a BEV. However, a business traveler relying on a highly flexible vehicle with changeable, long routes and no reliable charging access would favour the FCEV for higher productivity. All in all, the better we address these diverse needs, the faster we can help consumers transition to electric solutions. And every additional BEV or FCEV on the road is a step in the right direction, bringing us closer to our shared vision of clean mobility.
We may not know exactly what the world will look like by 2050 but we do know this is a transition of an unprecedented scale and risk, and we are in its initial stages with many issues to be solved throughout the entire transportation value chain. Offering multiple technologies tailored to individual use cases increases the user acceptance for this substantial societal and business challenge and hence increases the speed of transition. The climate crisis requires collaboration across regions, stakeholders, and all available technological solutions. There’s no time to spare and the only way to win is by working together.
Stefan Herbst, General Manager, Toyota Motor Europe
Peter Mackey, Vice President, Strategy & Policy Support, Hydrogen Energy, Air Liquide
Dr. Juergen Guldner, Head of Hydrogen Fuel Cell Technology, BMW Group
This article was first published in H2 View.
By Allan Baker, Head of Power Advisory & Project Finance at Societe Generale, Hydrogen Council member
As we round the corner towards the next COP26 in Glasgow, on the tail of the latest IPCC report, we know that hydrogen will play a major role in industry decarbonisation and ultimately achieving climate goals. The technology is ready, there is political backing like never before, and over 350 large-scale projects are in the pipeline globally1 – all of which shows unprecedented momentum. Yet, there are still big challenges to make the clean hydrogen revolution happen – and it starts with securing the market and financing mass scale up.
Scaling up funds
A smart combination of public and private financial instruments is possible, providing unique benefits and impacts. While grants can support innovation or early-stage demonstration projects, public procurement helps scale up the value chain through public sector investment, and instruments such as equity participation allow venture capitalists to play a leading role by investing in early-stage companies with high growth potential. If supported by appropriate long-term regulatory frameworks, these financial tools can help unlock large-scale projects and industry growth.
Hydrogen is following the trajectory that other clean technologies, such as wind and solar, have travelled before. First, large-scale projects are realised with the help of public funding – primarily grants and CAPEX subsidies for pilots and infrastructure. Then, as the industry begins to demonstrate a credible track record of returns within a reasonable time frame, an increasing pool of financial players and funds are willing to come into the capital structure on the equity or debt side, and the share of public support decreases. The advantage for hydrogen, in terms of timeframe, is that it’s not a new technology – so it leapfrogs some of the steps that other nascent technologies had to traverse.
Yet despite hydrogen technology being available, the market is still in relatively early stages and, as with wind and solar, mobilising the necessary large-scale private capital is only possible with government support at the outset, both fiscal and regulatory, to sufficiently de-risk investments. While industry and the financial community are taking on technology and counterparty risks, only governments can provide the necessary overall enabling environment by bearing risks linked to market development. Regulators around the world have understood this and are now working to kickstart the industry through temporary subsidising and clear long-term regulatory frameworks: more than 30 countries now have concrete hydrogen strategies in place, foreseeing $76 billion of funding2. Add carbon taxes and emission certificates to the mix, and this further shifts the economics in favour of clean energy technologies.
Making hydrogen bankable
While governments around the world are stepping up to support scale up, the financial community is also starting to hedge its bets on potential growth markets. Several dedicated hydrogen funds have emerged in recent months – and more funds, banks and ventures are watching closely, waiting to see the whole value chain move beyond the project level. This means hydrogen still needs to demonstrate how the global market will be established – not only from the supply side, but also distribution and end use. Essentially, for investors, they want to know where the revenues will come from.
Some of the biggest projects today are mass green hydrogen production projects in locations with specific advantages such as the Middle East or Australia – regions where vast amounts of renewable energy can be generated at low cost and used to produce green hydrogen with electrolysis. This provides impressive scale, but the sizable amount of hydrogen won’t be solely for domestic consumption, it will need to be transported to demand centres elsewhere as hydrogen or in the form of more easily shipped derivatives such as green ammonia. This distribution and demand side of the equation isn’t yet self-evident from a technical and economic standpoint. An investor attempting to quantify risk and revenue needs to know who that hydrogen will be sold to and at what price. To reduce uncertainties and demonstrate that projects are commercially viable, they need solid, long-term offtake contracts that are credit worthy.
As a member of the Hydrogen Council’s Investor Group, it’s an exciting time to be collaborating with the hydrogen industry to help join the dots. The pressure is certainly increasing for governments, big corporates, and investors to turn climate pledges into concrete actions, and it’s encouraging to see the various players aligning to help incentivise, finance and build the energy system of the future.