Against the twin backdrop of a global economic recovery and climate emergency, the hydrogen sector is enjoying an unprecedented buzz in 2021. Amid fund-raising announcements and increased government support, facilities harnessing the power of this energy carrier are proliferating worldwide, provoking a real disruption of the value chains of the involved sectors. From mobility to renewables, from chemicals to industry, we present an overview of the hydrogen initiatives across a variety of sectors.
On the release of International Energy Agency’s (IEA) 2021 Global Hydrogen Review, IEA Executive Director Fatih Birol commented: “We have experienced false starts with hydrogen in the past, so we can’t take success for granted. But this time, we are seeing exciting progress”1. While the IEA does not discount the cost issue for green hydrogen – currently three times more expensive to produce than its grey equivalent2 – the market is indisputably moving in the right direction. Global capacity of electrolysers, the technology that allows to extract hydrogen from water using electricity, has doubled in the space of five years. Between January 2019 and mid-2021, companies specialised in the production, distribution and use of hydrogen shrugged off the upheaval caused by the Covid-19 pandemic and succeeded to raise almost €9.5 billion in funding1. Picking up the pace with the unprecedented surge in financing, many projects have taken concrete form in different sectors all over the world.
Mobility: the pace is speeding-up
Prior to the health crisis hit, the transport sector was responsible for around 25% of greenhouse gas (GHG) emissions globally1. As such, it has been identified as a priority area in international climate goals. But there is considerable disparity across countries in terms of how hydrogen is being used as a fossil-fuel alternative.
“In Asia, mobility projects are much more advanced, and carmakers have reached a far higher level of maturity as they pursue commercial-stage projects”, says Charlotte de Lorgeril, a partner at Sia Partners, where she heads up the Energy, Utilities and Environment department. Trailblazing Japan put out the first mass market hydrogen car in 2008. Around 5,600 fuel cell vehicles were circulating on the Japanese roads in April 2021, out of a worldwide total of 40,000, and the country is targeting 200,000 vehicles by 2025. To provide the clean hydrogen necessary to match
these ambitions, major investments are underway, with the likes of Toshiba opening a renewable-powered 10 MW hydrogen production unit in Fukushima in 2020.
Europe is further behind. “We are more at the demonstration project stage. This highlights the importance of government funding, which can drive the investments needed to move up to an industrial and commercial scale”, says de Lorgeril. To give an example, in September, French firm Lhyfe inaugurated a hydrogen production unit in the Vendée region of western France. The plant is connected to nearby windfarms and will initially produce 300 kg of hydrogen per day before ramping up this number to a tonne daily. The green hydrogen supplied by this unit will provide clean fuel for heavy vehicles, including buses and waste disposal vehicles, in the surrounding areas.
Change underway in the aviation, rail and shipping sectors
The air sector too plans to tap into hydrogen-driven innovation, and not only by adopting hybrid engines, which are still at an experimental stage. The world’s first factory producing carbon-neutral kerosene at scale was opened in Germany in late September 2021. The green kerosene (or e-kerosene) supplied by Atmosfair, a German NGO, is a prime example of the circular economy applied to hydrogen: the factory uses electrolysis to produce hydrogen, which is combined with CO2 captured from the air to create a synthetic fuel similar to aviation jet fuel.
Meanwhile, rail has embarked on its own transition. Alstom-designed hydrogen trains featuring emission-free traction drives are already on the rails in Germany, Austria and the Netherlands. In spring 2021, France’s state-owned rail operator, SNCF, put in its first official order for dual-mode electric-hydrogen trains that can carry up to 220 passengers at 160 km/h with a range of 600 km3. By 2023, four French regions will dispose of this technology, which enables the replacement of diesel engines with fuel cells, hydrogen tanks and batteries.
The shipping sector is also ringing the changes, with some of the largest players setting goals that will pave the way for a genuine reduction in the pollution generated by the sector, currently responsible for 2.9% of GHG emissions globally. Danish leader Maersk has announced that in 2023 it will launch a zero-emission container ship that will be 100% powered by a green synthesis of methanol. And the group has set its sights even higher by aiming to make its entire fleet carbon neutral by 2050.
Tapping into green power
Another major potential application of hydrogen is power-to-gas (PtG) conversion, which offers a way to harness the power generated by intermittent renewable energy sources. Stored as hydrogen, this power can be retrieved using fuel cells and delivered to consumers as and when it is needed.
In September 2021, the construction of the world’s first power station using green hydrogen and generating non-intermittent energy4 began in Guyana.
Located in a non-interconnected zone, i.e. a French territory that is not on the mainland French grid, “this innovative power plant will provide year-long 24-hour supply to 10,000 Guyanese households”, says de Lorgeril, who has no doubts about hydrogen’s PtG potential. The project sponsor, Hydrogène de France Energy, raised over €130 million on the stock exchange in summer 2021.
Replacing a coal-fired power plant with a hydrogen hub
The industrial applications of green hydrogen are also gaining momentum, especially in the chemicals and steel sectors. Since gas is one of the basic materials of the chemicals and petrochemicals industries, large-scale use of green hydrogen will help to drive genuine decarbonisation in the manufacturing processes of these sectors, which have a track-record of being highly polluting. One area where this is happening is in the production of ammonia, a compound of nitrogen and hydrogen used in agricultural fertilisers. In steelmaking, Sweden as well as France have unveiled plans for facilities that will manufacture low-carbon steel using green hydrogen, including a future production unit in Dunkirk created as part of a tie-up between Air Liquide and ArcelorMittal. The vital need for change in polluting industrial sectors is spurring a reorganisation of production facilities: in Germany, the port city of Hamburg has announced ambitious plans, announcing that by 2025 it will build a European hydrogen hub with one of the world’s largest electrolysers, replacing a former coal-fired power station.
From industry to power and transport, the proliferation of hydrogen projects around the world reflects “issues and challenges relating to sovereignty and independence from petroleum-exporting nations”, according to de Lorgeril, who says that the geopolitics of energy could come to be seen from a totally new angle, with power potentially shifting towards hydrogen players. A strategic battle is looming, with multiple challenges but just one common winner: Planet Earth.
1. “Global Hydrogen Review 2021”, IEA