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The Haralds of Hydrogen

Floris Jacobus Adrianus de Klerk Wolters

Chapter 3: Background

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1Before addressing this paper’s central questions, it is useful to understand why hydrogen has received so much attention lately. The first thing to note is that hydrogen is not an energy source, but an energy carrier. Hydrogen is in this sense more like electricity, rather than oil or natural gas. There are no naturally occurring hydrogen reserves, as hydrogen is very reactive and easily forms other chemical compounds. In these compound forms, hydrogen is one of the most common elements on the earth’s surface, for example in the form of water or hydrocarbons (e.g. oil). In the universe at large, hydrogen is by far the most abundant element.

2 Hydrogen has several qualities that make it interesting in the energy transition (Jain, 2009). Its usage does not produce any carbon pollution; only heat and water. It is a very light fuel and is rich in energy per unit mass. It can be produced from water using electrolysis, and can be converted into thermal, mechanical, and electrical energy. It can be stored in various states, ranging from liquid to (compressed) gaseous and hybrids. Currently, hydrogen is mainly used to refine oil and produce ammonia. For an annual global production of around 70 million tonnes (Mt) of hydrogen, 830 Mt of CO2 is emitted (IEA, 2019b); approximately the combined 2018 CO2 emissions of France, Spain and the United Kingdom (IEA, 2018a). An additional 45 Mt of hydrogen that is mixed with other gases for methanol and steel production is also produced (IEA, 2019c, p. 31). The annual hydrogen production in the EU is roughly 8 Mt (Navigant, 2019, p. 28).

3.1 Types of Hydrogen

3 There are three ‘types’ of hydrogen, based on the production method: grey, blue and green hydrogen. Grey hydrogen is produced from fossil fuels without carbon capture and storage (CCS). This is currently the almost exclusively used form of hydrogen production. Sometimes grey hydrogen is broken down into black, grey and brown hydrogen. This refers to using coal, natural gas and lignite respectively, without CCS. Grey hydrogen cannot be a component of a zero-carbon energy future without additional offsetting measures, and it is not this type of hydrogen that this paper focuses on.

Figure 1: Sankey graph showing current hydrogen value chains and role grey hydrogen

Figure 1: Sankey graph showing current hydrogen value chains and role grey hydrogen

Source: IEA, 2019c, p. 32.

4Blue hydrogen is grey hydrogen with CCS. This makes it a low-carbon option, that can play a (major) role in the energy transition. Blue hydrogen is a realistic option in Europe, as there is enough CO2 storage space, and 5.8 Mt of hydrogen production could be equipped with CCS in the very short term (Navigant, 2019, p. 25). There are two main types of blue hydrogen: blue hydrogen with distributed decarbonisation, which leaves CCS to the user, and blue hydrogen with centralised decarbonisation, which makes producers responsible for CCS. Centralised decarbonisation has the advantage of small industries not needing to install expensive CCS systems, and the benefit that it can be centrally monitored, but it requires very large infrastructure investments (Navigant, 2019). Additionally, 300 Mt of captured CO2 can be used as input in the manufacturing (70 Mt) and chemical (230 Mt) industry. The advantage of blue hydrogen is its (financial) feasibility in the short term, and the kickstart it could give to the development of a (green) hydrogen network. The role of blue hydrogen is an important point for debate in shaping the future of hydrogen.

  • 1 For it to be truly green, this electricity needs to come from renewable (or nuclear) sources.

5Green hydrogen is the basis of most visions of the hydrogen economy. It is produced through electrolysis, with electricity as input.1 Currently, electrolysis accounts for just 2% of hydrogen production. There are three main technologies through which green hydrogen can be produced (IEA, 2019c; Navigant, 2019): Alkaline Electrolysers (AEs), Proton Exchange Membranes (PEMs), and Solid Oxide Electrolysis Cells (SOECs). AEs are technologically the most developed and cheapest but not very flexible. As renewables tend to be intermittent, flexibility is desired. PEMs are flexible but need significant cost reductions to become competitive. This is also the case for SOECs, which are technologically the most promising technology but are much less developed. The main obstacles for green hydrogen are the development of a hydrogen market and economies of scale. This requires large investments in both infrastructure and technology. For the time being, the price competitiveness of green hydrogen is still far from reaching parity with blue, let alone grey, hydrogen. This is expected to converge around 2030 (IEA, 2019c).

Figure 2: Estimated costs of producing hydrogen through various methods in Europe in 2030

Figure 2: Estimated costs of producing hydrogen through various methods in Europe in 2030

Source: IEA, 2019c, p. 52.

3.2 Perceived Benefits

6 Hydrogen has several big perceived benefits: it can complement the flow-based nature of electricity, diversify energy input, is compatible with existing infrastructure, and can help decarbonise hard-to-abate sectors in industry and transport. Although this paragraph focuses on the benefits, it is important to keep in mind that there are also many downsides to hydrogen. Examples of these include efficiency losses when it is converted, but also safety issues due to its highly inflammable nature, and (for blue hydrogen) the debates surrounding the desirability and viability of CCS. These are given more attention in the literature overview.

7 The first benefit of hydrogen is that it can complement the flow-based nature of electricity: electricity production and consumption must be matched across time. There are ways to decrease the necessity for perfect matching (e.g. batteries), but these are only a partial solution. Gas storage capacity in Europe today is over 50,000 times the current global battery storage capacity (IEA, 2019b, p. 580). Matching is a problem for solar and wind energy, which have high variability. This challenges energy grid stability in grids with a high percentage of wind and solar energy production (see e.g. Castillo & Gayme, 2014; Kroposki et al., 2017). Other renewables such as hydropower and geothermal energy are more stable, but many regions in Europe do not have the potential for these. Although there are serious energy losses from conversion, hydrogen is a potential solution, as it can be transported and stored to fulfil changing demand over time and space. Excess renewable energy could even be used directly to produce hydrogen through electrolysis. This is important: European energy transport still primarily (80%) relies on molecules rather than electrons (20%), and unfolding energy grid limitations can hold back the deployment of solar and wind energy production (Chatzimarkakis, 2020). This is also relevant for the big seasonal demand swings for building heating (Zeniewski, 2019).

8Solar energy production in Europe runs countercyclical to heating demand: most solar energy is produced during long summer days when demand for heating is low. Although there is more wind in winter, the difference is not enough to compensate for the seasonality of heating demand. Hydrogen could be a better zero-carbon solution to replace natural gas demand in winter than electric heating.

Figure 3: Graph on seasonal gas demand in the EU in the IEA's New Policies Scenario in 2040

Figure 3: Graph on seasonal gas demand in the EU in the IEA's New Policies Scenario in 2040

Source : Zeniewski (2019).

9Diversification is a second benefit. The increasing role of electricity in consumer homes (e.g. heat pumps, cooking) and personal mobility also increases the severity of electricity disruptions. Hydrogen has the potential to offer a more diversified energy supply, as well as serving communities with a lesser developed electricity infrastructure (e.g. remote communities or older neighbourhoods).

  • 2 The UK has since left the EU.

10A third benefit is the compatibility with existing natural gas infrastructure. This is especially interesting for the countries with big natural gas networks, high heating demand in winter, and older buildings. EU countries where natural gas plays a big (>40%) role in the total building heating demand include, in decreasing order of nonseasonal share of demand, the Netherlands, Italy, the UK,2 Hungary, Slovakia, Belgium, the Czech Republic, France, Germany, Croatia and Romania (FCH JU, 2019a, p. 36). Borderline cases are Spain, Ireland, Austria and Poland. The grid-level advantages are clear: capital investments in natural gas networks are not lost, as they would be in a purely electricity-based scenario. This is a major advantage: 38% of European buildings are heated via gas networks, and this will likely remain so until 2030 (Cătuţi et al., 2019). Given the continued investments in natural gas, there are incentives to maintain existing networks. This is more attractive when they have utility beyond the horizon of natural gas. Hydrogen allows the diversification of these natural gas distribution networks, rather than increasing electricity dependency.

11 Hydrogen can already be blended into existing gas flows, with no need for changes. This delivers direct carbon emissions reductions. Safe current blending estimates range between 5-20% (Cătuţi et al., 2019, p. 22; FCH JU, 2019a; IEA, 2019b, p. 590; Melaina et al., 2013). Concerns exist for older engines and industrial users with lower hydrogen tolerance turbines and compressors (IEA, 2019b, p. 592). Nevertheless, replacing older machines is cheaper than building capacity up from zero. Fuel stations can also be converted to hydrogen refuelling stations (HRSs) rather than the much higher cost for electric mobility infrastructure.

12 The fourth benefit is the ability to decarbonise chemical feedstocks in hard-to-abate industries and transport. These include aviation, shipping, rail and road transport, as well as the chemical, iron, steel, and cement industry. Main electrification problems in heavy industry are difficulties with switching fuel, the difficulty of designing high-temperature electric furnaces, changing industrial processes, and the long lifetime of industrial capital stock (IEA, 2018b, p. 403). The International Renewable Energy Agency (2018) notes that hydrogen as competitive feedstock can avoid carbon leakage of heavy industries moving elsewhere.

13 There are similar hopes for various forms of transport, such as rail (FCH JU et al., 2019), shipping (Pratt & Klebanoff, 2018; Tronstad et al., 2017), road (FCH JU, 2019a; IEA, 2019c, p. 133; IEA Energy Technology Network, 2019), and even aviation (Contreras et al., 1997; IEA, 2019c; Pohl & Malychev, 1997; van Zon, 2018). However, the IEA (2019c) is pessimistic about the ability of hydrogen to become competitive in shipping without policy intervention, hydrogen in aviation is still largely an infant technology, and consumers still pay a 100% premium for fuel cell cars vis-à-vis fossil fuel cars (Oladini, 2018). Most focus for now is thus on heavy road transport (IEA, 2019c), and rail.


1 For it to be truly green, this electricity needs to come from renewable (or nuclear) sources.

2 The UK has since left the EU.

Table des illustrations

Titre Figure 1: Sankey graph showing current hydrogen value chains and role grey hydrogen
Crédits Source: IEA, 2019c, p. 32.
Fichier image/png, 146k
Titre Figure 2: Estimated costs of producing hydrogen through various methods in Europe in 2030
Crédits Source: IEA, 2019c, p. 52.
Fichier image/png, 162k
Titre Figure 3: Graph on seasonal gas demand in the EU in the IEA's New Policies Scenario in 2040
Crédits Source : Zeniewski (2019).
Fichier image/png, 76k


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