However the world’s largest emitting area will want inexperienced hydrogen – that’s, hydrogen produced from renewable sources – to decarbonise carbon-intensive industrial sectors comparable to metal and obtain regional local weather objectives, mentioned Simon Nicholas, lead analyst, international metal, at suppose tank Institute for Power Economics and Monetary Evaluation (IEEFA).
Because the world’s largest shopper and producer of metal, Asia accounts for almost all of greenhouse gasoline emissions (GHG) from the sector, and hydrogen holds the potential to decarbonise the sector at scale, Nicholas mentioned.
Talking at IEEFA’s Power Finance convention in Kuala Lumpur in September, Nicholas mentioned excessive manufacturing prices are making it troublesome for the business to undertake its use, resulting in the cancellation of initiatives and scaled again investments.
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We’d like a actuality verify. There’s an excessive amount of hype about inexperienced hydrogen.
Simon Nicholas, lead analyst, international metal, Institute for Power Economics and Monetary Evaluation
Inexperienced hydrogen is produced by electrolysis – splitting water molecules into oxygen and hydrogen – utilizing renewable vitality like wind and photo voltaic, which might successfully change hydrogen produced from fossil fuels.
“Metal is a type of sectors the place we do want inexperienced hydrogen provide at cheap value,” Nicholas mentioned. He cited a brand new facility in Boden, Northern Sweden, which shall be Europe’s first commercial-scale metal plant powered by inexperienced hydrogen. The plant, owned by H2 Inexperienced Metal, is anticipated to be operational by 2026.
Northern Sweden’s decarbonised energy grid, which makes use of electrical energy from hydropower and wind, permits the manufacturing of comparatively low cost inexperienced hydrogen. This clear gas can be utilized to provide hydrated iron ore to make low-carbon metal.
Comparable alternatives to make use of inexperienced hydrogen are on the horizon in South Australia. The state is about to plug electrolysis initiatives into the grid to provide inexpensive inexperienced hydrogen by 2027, Nicholas mentioned.
Nonetheless, the quantity of renewable vitality wanted to decarbonise an influence grid to provide inexperienced hydrogen is a key impediment to scaling it in Asia.
“The issue is that there’s a want for an terrible lot extra renewable vitality simply to decarbonise the grid, not to mention produce inexperienced hydrogen. Attempting to do each is troublesome,” Nicholas mentioned.
He mentioned the largest alternatives to deploy inexperienced hydrogen shall be in jurisdictions the place the grid has already been decarbonised, so doing so in fossil fuel-dependent Asia shall be notably difficult.
Requirements and regulation
In addition to the necessity for renewable vitality, inexperienced hydrogen is troublesome to scale on account of a scarcity of widespread requirements for the manufacturing and use of the gas.
Kentaro Tamura, the local weather and vitality programme director at Japan-based analysis non-profit Institute for International Environmental Methods (IGES), mentioned key requirements and certification schemes for inexperienced hydrogen are mandatory for it to turn out to be a extra tradable vitality commodity.
The dearth of an internationally agreed commonplace for hydrogen has meant nations have developed their very own requirements and rules for guaranteeing that the tip product is really climate-friendly, he famous.
“An internationally agreed [hydrogen] commonplace and mutual recognition of certification schemes requires political dedication, time and settlement on the minimal standards for the usual,” he mentioned.
“There was some progress on the G7 Hiroshima Summit final 12 months the place the respective leaders agreed on creating a standard commonplace for hydrogen in addition to mutual recognition of the necessity for a certification scheme. Then at COP28 final 12 months, greater than 30 nations agreed to work in direction of a hydrogen certification scheme.”
Kentaro famous that the requirements physique Worldwide Group of Standardization (ISO) unveiled new technical specs for assessing the hydrogen worth chain at COP28.
Primarily based upon this specification, a set of three worldwide requirements for hydrogen manufacturing, conditioning and transportation are to be developed by 2026.
Nonetheless, authorities regulation shall be wanted to make sure the steadiness of the inexperienced hydrogen sector because it develops, he mentioned.
“The predictability of the inexperienced hydrogen enterprise depends on regulation. If the federal government adjustments rules, it may possibly threat disrupting inexperienced hydrogen initiatives,” he mentioned.
He added that scaling inexperienced hydrogen ought to first deal with hard-to-abate sectors comparable to metal, transportation and mechanical.
Nicholas famous that inexperienced hydrogen venture builders can’t signal off-take agreements and implement initiatives on account of excessive value.
He mentioned metal makers in Europe have pushed again on utilizing inexperienced hydrogen to provide low-carbon metal as a result of of value, even after constructing amenities to make metal from inexperienced hydrogen.
In 2023, inexperienced hydrogen on common prices US$6.40 per kilogramme in comparison with blue and gray hydrogen, which value solely US$3.10 and US$2.13 per kilogramme, respectively.
Blue and gray hydrogen are each produced from pure gasoline, the previous utilizing carbon seize and storage applied sciences, the latter releasing carbon into the ambiance.
The usage of renewable vitality to provide inexperienced hydrogen contributes to the foremost distinction in value for inexperienced hydrogen, on condition that non-renewable vitality sources are nonetheless cheaper and extra available in a lot of Asia.
Nicholas added that whereas governments might help to cut back value by subsidies and different incentives, there was a necessity for a inexperienced hydrogen “actuality verify”.
“We have to neglect about a number of the proposed makes use of for inexperienced hydrogen, as a result of we truly don’t want fairly as a lot inexperienced hydrogen as we predict we do, and simply deal with the important thing sectors the place it’s actually going to make a distinction,” he mentioned.
