Decarbonisation Technology May 2022 Issue

Distributed hydrogen hubs Advanced technology paired with global hydrogen production hubs can lead to lower transportation costs and fewer carbon emissions

Gabriel Olson BayoTech

A chieving net-zero emissions by 2050 will require nothing short of a complete transformation of the global energy system. How can we decrease our reliance on fossil fuels while ensuring reliable and affordable energy supplies, providing equitable energy access, and enabling economic growth? It will require the deployment of a host of clean energy technologies. No one solution can meet the demand of all sectors. Hydrogen is an essential tool in the energy transition toolbox. Hydrogen is a flexible fuel that will fill the gaps where electricity alone cannot easily or economically replace fossil fuels. It is critical for decarbonising the steel and fertiliser industries as feedstock. Long-range ground mobility applications such as heavy-duty trucks, buses, off-road equipment, and trains require the long-range payload capabilities and quick refuelling provided by hydrogen. Hydrogen blended with natural gas reserves creates a cleaner-burning fuel and increases the renewable content of the gas delivered through our natural gas infrastructure. Hydrogen can also aid in enabling more solar and wind on the grid by serving as a seasonal energy storage solution to avoid curtailment, as well as playing other roles in electric grid management. The hydrogen revolution is just getting started. Deployments and investments in hydrogen are accelerating rapidly as governments commit to deep decarbonisation goals. Over 30 countries have hydrogen roadmaps, and the equivalent of $160 billion of direct investments are taking place today, according to the Hydrogen Council (Hydrogen Council, 2021a, Hydrogen Council, 2021b).

Unlocking potential of emerging hydrogen applications Steam methane reforming (SMR) is the most widely used method for hydrogen generation (US DOE, 2022). SMR is a process in which methane from natural gas is heated, with steam and a catalyst, to produce hydrogen. Most hydrogen is produced at a few centralised production plants for supply directly to refiners and chemical manufacturers. For customers in other regions – consuming hydrogen for emerging applications such as transport and power generation – hydrogen must be liquefied and trucked long distances. This creates a series of adoption challenges. Hydrogen’s low volumetric energy density makes it inefficient to transport. The liquefaction and then distribution via diesel truck increases the carbon intensity of the hydrogen. Furthermore, distributed customers relying on excess hydrogen from a central plant are the first to have supply interrupted. The current hydrogen supply is expensive and unreliable, with a high carbon footprint. To unlock the potential of these emerging applications, a cost- and energy-efficient production and distribution model is required. The most competitive and low-carbon solution is to co-locate hydrogen production onsite or near emerging demand centres. Hydrogen hubs are emerging – regional clusters of hydrogen producers and consumers that will scale the industry together (BayoTech, 2022a). Producing hydrogen at a smaller volume at more numerous locations has many apparent benefits. It opens the door to leveraging local resources – natural gas, renewable natural gas from biogenic sources, or solar and wind combined with electrolysis – to produce cost- efficient hydrogen. This creates local jobs and helps transition the workforce to clean energy