By Bill Ireland, Logan Energy
This year’s COP26 summit is widely viewed as one of the last chances to fulfil the 2015 Paris climate agreement and ensure meaningful progress is made towards tackling our net zero targets and the climate emergency.
Hydrogen is one of the energy solutions that can significantly address climate change and has a vital role to play in decarbonization. In the last decade, green hydrogen in particular has shown great promise as an integral part of the renewable energy mix needed for a sustainable future.
But barriers to widespread hydrogen adoption remain and questions have been raised about its realistic role, scale and value within the world’s future energy mix. It’s clear that a dedicated infrastructure is currently lacking, production costs outweigh less-clean competitors, and that government policy shows technology agnosticism is a myth.
We must ask ourselves – does hydrogen have a wider future?
Accelerating hydrogen activity
Rapid progress towards establishing net zero industry clusters can be facilitated by making best use of regional resources and organizations. Hydrogen cluster projects with industry, local government and communities can deliver the early steps towards net zero. To speed up rollout, the “hub and spoke” model, such as that being delivered by Menter Môn at one of the UK’s busiest heavy-haulage ports in Holyhead, North Wales, is an intelligent option. Producing hydrogen at a centralized hub then supplying to on-site refueling stations or transporting to external customers is very well suited to hydrogen.
However, if there is to be wide-spread adoption of hydrogen as a viable alternative energy source, there needs to be a national focus on establishing a network of hydrogen production and refueling — not unlike EV charging roll out — to provide the basis for resilient local supply chains. This type of coordinated energy systems approach can use hydrogen to simultaneously decarbonize transport, industry and heat by identifying and involving regional industry and consumer demand and matching this to energy supply opportunities and industry investment.
Production costs
Implementing clean hydrogen solutions is not without financial challenges. It requires upfront investment to build and maintain the technology required to produce clean hydrogen, such as electrolyser systems, pipeline modifications, and carbon-capture capabilities. Green hydrogen, produced using renewable energy sources such as solar or wind power and electrolysis, is more costly to produce than its dirtier equivalents, and is dependent on the cost of electricity and available water.
Manufacturing and installing hydrogen technology at scale is one of the main ways that costs can come down — the sooner the economic landscape allows for this scale of deployment, the sooner the shift to a zero-carbon economy. Increasing manufacturing scale typically decreases cost as producing large volumes can decrease the cost contribution of overheads, improve utilization of equipment, and reduce losses by improving the process yield. Additionally, higher volumes produced increases the likelihood of cheaper automatic assembly methods to be used.
This requires investment and government backing, and vitally more education and understanding about the unique benefits of this renewable energy opportunity. With hydrogen, we have the technology and the skills needed to give our energy sector the shake-up it needs to meet our goals. We simply need to commit, think bigger and embrace what it can offer us.
Policy-driven benefits
Political will must be galvanized and renewed as we emerge from the fall-out of Covid-19, and energies refocused on climate change as soon as resource is available. Strong, clear policy frameworks are key in meeting our ambitious renewable energy targets and are currently lacking. We must do more.
The industry needs long-term policy and subsidies to stimulate hydrogen demand. Production will follow. Policy that puts hydrogen on an even playing field with already-subsidized energy sources will provide investors with the basis to form robust business models that can act as a catalyst to drive real change.
Investors are typically risk-averse and need to feel secure. If policy makers can generate a predictable 5–10-year pipeline of green hydrogen projects, manufacturers will feel confident about investing in new, larger and automated production facilities and accompanying technologies. Governments can support these initiatives by setting manufacturing tax benefits, offering subsidies for production, and loans for expansion and upgrading facilities, and collaborate closely with industry to align to its needs as it evolves.
The UK Government should also adopt a Sustainable Investment Taxonomy or Sustainable Investment Hierarchy approach to inform and guide all public sector investment and procurement decisions. Classification systems such as these will help organizations understand if an initiative is sustainable, and direct capital flow to sustainable investment opportunities, and companies engaged in sustainable activities.
So, what is the wider future of hydrogen?
With the highest energy density of any fuel per kilogram, hydrogen gas is stable enough to store energy longer than any other medium. It can easily be transported and stored, meaning energy from renewable sources can be used when and where availability demands, not just when the sun shines or the wind blows.
Balancing demand for renewable energy sources with these uncontrollable environmental factors means that hydrogen is an achievable, sustainable and desirable clean energy source globally. Aligning perfectly with the UK Government’s 10 Point Plan, hydrogen can advance the further installation and use of renewable technologies, such as solar photovoltaics (PV) and wind farms, driving the growth of low carbon energy.
Commercial interest is already increasing. With significant potential and appetite for hydrogen energy in both the heating and transport sectors, there have been many recent developments in the understanding of timelines and economies of scale for renewables, electrification, and green hydrogen.
However, we must not lose focus. There are technical and economic challenges to overcome for hydrogen. Infrastructure must be built, technologies developed, and communities and stakeholders educated about the benefits to increase buy-in. An imaginative, joined-up approach is key, and it can be achieved.
By strategically planning hydrogen ‘hub and spoke’ facilities we can help meet this demand across almost any territory and drive our biggest emitters, such as transport and heavy haulage, to significantly reduce CO2 output. This will act as a springboard for the wider adoption of hydrogen technologies across both commercial and domestic settings.
The UK pledged to prevent global warming from spiraling out of control by signing the 2015 Paris Agreement – enshrining into law the ambitious climate change target to cut emissions by 78% by 2035. To achieve that goal, three quarters of our electricity will need to be sourced from clean energy. Green hydrogen is a clear and available solution. We simply need to work together to realize our shared goals.
About the Author
Bill Ireland has over 30 years’ experience in engineering with specialist knowledge in energy in the built environment, alternative technologies, sustainable design and innovation in technology. He joined Logan Energy Limited in 2008 as Director of Operations and became Managing Director and CEO in 2012. Bill is responsible for driving the business of Logan Energy in the UK, Europe and further afield.
