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Green Hydrogen – A step towards Decarbonization

Green Hydrogen: A step towards decarbonization

 

All about Hydrogen

Hydrogen, with symbol H and atomic number 1 is the lightest and most abundantly available substance in the universe. Hydrogen is found in great quantities on Earth combined with other elements, such as in water and hydrocarbons, but it is barely present in our atmosphere, which contains just 0.00005%.

This is why, to obtain hydrogen in the gaseous form, it must be produced through extraction from the molecules that contain it and it must be stored.

Types of Hydrogen

  • Grey – It is the most common way of extracting hydrogen. Grey Hydrogen is produced from natural gas like methane using “Steam Methane Reforming”. It is environmentally damaging as the products, i.e., heat and carbon dioxide, are released back into the atmosphere.
  • Brown – Brown hydrogen (made from brown coal) and black hydrogen (made from black coal) are produced via gasification. It’s an established process used in many industries that converts carbon-rich materials into hydrogen and carbon dioxide. As a result, gasification releases those by-products into the atmosphere.
  • Blue – Blue hydrogen uses the same process as grey, except the carbon is captured and stored this time. This makes it much more environmentally friendly but comes with added technical challenges and a significant increase in cost.
  • Green – Environmentally safe and sustainable, it is produced using Electrolysis.
  • Other types, aka colours of hydrogen, i.e., pink, turquoise and yellow, are still at Research and Development stage.

Green Hydrogen: Sustainability at its best

 

  • Production of Hydrogen contributes 2% to the global carbon emissions
  • There has been longstanding research going on to explore Hydrogen’s potential as a clean energy solution
  • Green Hydrogen could revolutionize the energy industry and be a step towards a more sustainable future

Electrolysis Process

 

Electrolysis is the process of using electricity to split water into hydrogen and oxygen. This reaction takes place in a unit called an electrolyzer. Generally, the overall reaction from water electrolysis can be divided into two half-cell reactions: hydrogen evolution reaction (HER) and oxygen evolution reaction (OER). HER is the reaction where water is reduced at the cathode to produce H2, and OER is the reaction where water is oxidized at the anode to produce O2. In simpler terms, electrolysis separated hydrogen from water, releasing oxygen as the only by-product. If the electricity comes from renewable sources such as wind, solar or hydro, then the hydrogen is effectively green, a step towards a cleaner and more sustainable environment.

HYDROGEN VEHICLES: ANOTHER RACE?

 

 

How does a fuel cell car work?

Like all-electric vehicles, fuel cell electric vehicles (FCEVs) use electricity to power an electric motor. FCEVs produce electricity using a fuel cell powered by hydrogen rather than drawing electricity from a battery. Because hydrogen is an energy carrier and not an energy saver, hydrogen must be converted to electricity by a fuel cell stack device. As it is clear from the picture, a hydrogen tank is attached to this stack. It reacts with a catalyst. Most often, this catalyst is made from expensive platinum. As it passes through a catalyst, it gets detached from its electrons. These electrons then move along the electric circuit, producing electrical current. An electric motor uses the current to power the car. The remaining hydrogen reacts with oxygen, releasing a byproduct, i.e., water vapour.

 

Hydrogen Fuel Cell VS. Battery Electric: Which is better?

  • Though expensive, hydrogen cars only take 5 minutes to charge up as compared to 45 minutes for EVs.
  • EVs use lithium batteries that cannot be used for long hauls like trucks and airways.
  • Hydrogen cars are better in efficiency and storage too.
  • Green Hydrogen makes use of extra renewable energy which would be wasted otherwise.

 

Decarbonization : A fight against climate change

European Union– EU wants to spend $1 trillion to help make it climate neutral by 2050. Half of this amount would be dedicated towards the production of green hydrogen. In addition, the EU also promotes several research and innovation projects on hydrogen within the Horizon 2020 framework. These projects are managed through the Fuel Cells and Hydrogen Joint Undertaking (FCH JU), a joint public-private partnership that is supported by the European Commission. This includes the EU-funded Djewels project, which will build a 20MW electrolyzer.

 

  • China China is pushing its regions to maximize renewable energy usage. Chinese chemical producer Baofeng has started production from the world’s largest green hydrogen plant in the Chinese region of Ningxia raising global installed electrolyzer capacity by 50%. The news highlights how China is beating the world on climate technologies.
  • South Korea South Korea will provide 27.9 million MT/year of “clean hydrogen” by 2050, all of which will be either green or blue hydrogen. There are plans to make South Korea a “first mover in the hydrogen economy”. Apart from this, South Korea claims fuel cell technology a key to its energy future.
  • Japan Japan sees hydrogen as a major way to decarbonize its economy while sustaining its industrial competitiveness. Toyota amongst others are helping Japan to with its multi billion dollar push to create a hydrogen fueled society.
  • United StatesPresident Biden has also announced that the US would invest $1.7 trillion in the fight against climate change. Back in 2020, US Department of Energy announced that it would invest $ 100 million to advance hydrogen production and fuel cell technologies Research and Development.

 

World’s Largest Project:

Mitsubishi Power, a maker of gas turbines, along with Magnum Development are working on a project in UTAH to store 1000 megawats of clean power partly in salt caverns. Said to be operational by 2025, it would be world’s largest clean storage project.

 

India’s Take:

 

National Hydrogen Mission

In the speech at Red fort, marking celebrations of the 5th year of independence on Sunday, Prime Minister Narendra Modi launched National Hydrogen Mission. He claimed that government is focusing on meeting its climate targets. Efforts towards some of these targets are showing results like increase in forest cover, increase in population of endangered species, focus towards renewable energy etc.

In India, hydrogen appetite is around 6.9 million tons a year, which is poised to jump to 12 million tons a year by 2030 and 28 million tons a year by 2050, according to an Argus report. At present in India, fossil fuels contribute about 60 percent to installed electricity generation capacity, while hydro, wind, solar and other renewable sources account for over 38 percent. Government has announced a target of achieving 450 MWs Renewable energy by 2030.India is not energy independent. It spends over Rs. 12 lacs crore on importing energy. Modi announced his intentions to make India energy independent before completing 100 years of independence.

THE MISSION

  • India’s ambitious goal of 175 GW by 2022 got an impetus in the 2021-22 Budget which allocated Rs. 1500 crore for renewable energy development and National Hydrogen Mission.
  • The NHM, according to the Ministry of New and Renewable Energy (MNRE), has identified pilot projects, infrastructure, and supply chain, research and development, regulations, and public outreach as broad activities for investment with a proposed financial outlay of Rs 800 crores for the next three years.
  • It aims to leverage the country’s landmass and low solar and wind tariffs to produce low-cost green hydrogen and ammonia for export to Japan, South Korea, and Europe.

 

Current Scenario: India

RELIANCE INDUSTRIES The company recently announced its plans to become a net carbon-zero firm by 2035. It aims to replace transportation fuels with clean electricity and hydrogen. The conglomerate said it will invest ₹750 billion over the next three years in renewable energy. Out of this, it will invest ₹600 BILLION in a 5,000-acre, green energy integrated complex called Dhirubhai Ambani Green Energy Giga Complex in Jamnagar, Gujarat. The company’s chairman, Ambani, aims to produce hydrogen at ‘under US$1/kg within a decade’.

GAIL GAIL has already started mixing hydrogen in natural gas in one of the cities, on a pilot basis. The company has finalized 2-3 sites. The plant planned will have a capacity of 10 MW, the largest announced so far in the country.

NTPC Just like GAIL, NTPC plans to produce green hydrogen on a commercial scale. NTPC also plans to set up its first green hydrogen fuelling station in Leh, Ladakh. It will ply 5 hydrogen buses, to start with. The company has recently revised its target of achieving 60 GW renewables capacity by 2032, almost doubling the earlier target

INDIAN OIL CORP It plans to come up with a stand-alone green hydrogen manufacturing unit in Kochi that will draw energy from the solar power facility of the Kochi International Airport. Kochi is the world’s first fully solar-powered airport with a total capacity of 40 MW. The idea is to run hydrogen buses from Cochin airport to Thiruvananthapuram. Indian Oil has set a target of converting at least 10% of its hydrogen consumption at refineries to green hydrogen soon.

LARSEN AND TOUBRO – In its latest annual report, L&T said it aims to be net-zero emissions by 2040. 90% of this would come from switching over to initiatives such as renewable energy, green hydrogen and biodiesel while the other 10% would be offset by creating carbon sinks.

 

Is it Economically Viable?

Anti – Thesis

  • Price- The production cost of green hydrogen is too high. According to CNBC report, hydrogen vehicles are twice-thrice expensive than Electric vehicles. It is estimated that the production costs for green hydrogen could fall by up to 62% until 2030. Till it happens, it is out of reach for people.
  • Distribution and Storage- There are safety challenges regarding the storage of hydrogen in tanks due to its high volatility and flammability.
  • Transportation- A proper infrastructure is required to transport hydrogen from production station to fuel stations which is a long way to go.
  • Inefficiency– The main issue raised by some experts is that in the conversion process, 70% of the efficiency of green hydrogen is already lost.

 

Conclusion

All ground breaking innovations and breakthroughs come with their fair share of problems but that doesn’t mean they aren’t worth exploring. Green hydrogen too has a long way to go but with corporates actively working towards making it economically feasible, the future seems green. To FastTrack the process, the government should come up with incentives to help with the investment heavy nature of the project. Companies should continue to make strides in this direction and hopefully soon the dream of it being available in $1 per KG will be realised.

Anchal Kansal

Investment Operations Intern

Anchal is a part of Investment Operations team. She is responsible for content research and marketing. Part of her work includes equity research as well. She is a final year student at Delhi University and has previously done an internship with Invest India. Her academic interests include Finance, Valuation and Data Analysis.

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