In February, the biggest green hydrogen news was the results of the UK Government’s Phase 2 supply competition. Even as the world has faced challenges such as Covid-19, hydrogen has raced to the top of the green energy and green recovery agendas.
We have seen significant activity in recent months, perhaps the most significant is the impending publication of the EU hydrogen strategy. Other activity included: Germany publishing its own national strategy, the launch of a joint venture to develop a sustainable transport fuel hub in Copenhagen, the UK Government announcing the funding of the HydroFLEX train project and the launch of Shell’s NortH2 project.
So why all the attention now?
Hydrogen has three key beneficial features:
- Make anywhere: It can be produced using electrolysis or steam methane reforming, both proven technologies relying on different feedstocks. This technological flexibility improves security of supply, price security, and allows hydrogen to be produced wherever there are strong natural resources.
- Move anywhere: It can be integrated into existing gas storage and transport infrastructure with minimal upgrade requirements.
- Use anywhere: It is versatile, having applications in industrial feedstock production, heating, and electricity generation. For transport, it can play a key role in areas where batteries cannot currently compete such as heavy haulage, maritime and aviation.
It is the combination of these three features that makes hydrogen so attractive. It creates value for assets that would otherwise become redundant in an all-electric future, such as gas networks. It enables the oil and gas industry to apply their vast experience with gaseous fuels, operation of offshore assets, and leverage their capital towards mitigating climate change. It also provides an easier decarbonisation option where electrification is challenging, such as in aviation and shipping. For renewable energy companies, it also offers a significant opportunity for growth. Increased demand for renewable hydrogen will enable installation of more renewable electricity generation. This would be particularly effective in areas that would otherwise require costly electricity transmission upgrades, such as in the north of Scotland. Countries with more renewable energy resources than energy demand could become hydrogen exporting hubs. Ireland, Norway, and New Zealand are some examples of where this may be possible.
Greater use of hydrogen is not without challenges. Governments have to commit to developing the industry. Commitments need to include setting firm targets for hydrogen production and putting in place revenue support schemes to encourage investment.
Delivering support for hydrogen production must happen alongside the development of end-use systems. Its versatility makes this a more complicated issue. Aviation, heating, shipping, and transport all require tailored support. This will need to include a mix of regulatory and fiscal changes.
Of course, once governments have made a commitment to hydrogen, industry must respond with commercial and technical solutions to ensure hopes are realised. I’m looking forward to working with industry to meet these challenges. Then the wind industry can truly reap the benefits of hydrogen.
