Most of the world supports moving toward carbon neutrality by 2050. Despite the incredible difficulties ahead, it’s a goal worth pursuing given that the stability of the world hangs in the balance.
Renewable energies like solar and wind have long been touted as key parts of this goal. But they are far from perfect solutions, given the fact that the sun isn’t always shining and the wind isn’t always blowing. Batteries have been proposed as one solution for the literal and figurative “rainy day,” but they are often made from non-renewable metals like lithium, manganese, and cobalt. Their limited energy storage capacities also mean it’s pretty unlikely we could see batteries being used to power entire neighborhoods; industrial manufacturing of materials like steel, cement, and chemicals; or heavy transport vehicles like airplanes and cargo ships. Electrifying all of these processes with batteries is basically an unrealistic scenario, at least with current technologies.
The missing link to slashing carbon emissions from our economies could be something called green hydrogen—power derived from the most abundant element in the known universe. New calls for investment in green hydrogen were a high mark at the UN’s COP26 climate change conference last month.
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Surprisingly, it isn’t just the richest countries that are racing to become forerunners in green hydrogen. In fact, many smaller countries are seeing an opportunity to get ahead while the competition is still lukewarm and position themselves into a more secure future, while also helping to stave off climate disaster from dooming the world.
The Fix Is In
To understand what green hydrogen is, first we need to unpack how hydrogen itself can be a form of energy. In a chemical reaction called electrolysis, water is broken down into oxygen and hydrogen when an electric current passes through the system. When the opposite reaction takes place and hydrogen bonds with oxygen, it releases electrical energy that can be used to power multiple systems—including homes, factories, and even parts of an entire electrical grid.
Hydrogen is widely used as a feedstock to produce fertilizers, chemicals and energy for fuel cell cars. But the problem is that today, over 95 percent of the hydrogen produced in the world is obtained through a chemical reaction called steam methane reforming, which uses natural gas and releases not only carbon dioxide but also carbon monoxide. Hydrogen obtained by this process is called grey hydrogen.
Running the process through renewable energy, however, would mean that hydrogen can be produced without any carbon emissions—thus making it "green."
Hydrogen fuel can be stored and transported in many forms: as a liquid at very low temperatures (minus –423 Fahrenheit), as a pressurized gas (350-700 bar), or as another chemical compound like ammonia. Compared to solar and wind, green hydrogen would be a game changer in energy production since no batteries are needed to store energy, and the hydrogen can be transported not only by ships on sea but also in pipelines. Worldwide, there are already more than 3,100 miles of hydrogen pipelines that can be used to transport green hydrogen in the future. In northwestern Europe, a 560-mile hydrogen-pipeline network runs through Rotterdam (the Netherlands), Antwerp (Belgium), and Dunkirk (France). And natural gas networks could be easily adapted to transport green hydrogen. Depending on the region, gas pipelines can devote between 2 and 20 percent of their transportation capacity to hydrogen.
According to a recent report by the Hydrogen Council, in a carbon-neutral world demand for green hydrogen could reach approximately 660 million metric tons in 2050, making up 22 percent of the final energy demand globally. This could offset annual carbon dioxide emissions by about 20 percent if the world remains on its current global warming trajectory.
Energy policy expert Anne-Sophie Corbeau from Columbia University told The Daily Beast that carbon-neutral scenarios “tend to have a higher hydrogen demand because they have different scenarios with different climate ambitions. As a result, how significant the call on green hydrogen will be depends highly on these demand forecasts for total hydrogen and on which pathway we are in terms of greenhouse gas emissions.”
Corbeau added: “Any forecast at this stage is highly uncertain, but it's fair to say that there is a trend showing lower fossil fuel demand and higher hydrogen demand.”
If these demand predictions pan out, green hydrogen has the potential to transform the global map of energy trade. It is technically possible to produce green hydrogen almost everywhere in the world since it only requires access to a form of renewable energy to initiate the electrolysis process. Thus, we could see a more leveled energy playing field around the world, creating new energy exporters and importers as fossil fuels like oil fall from prominence.
The main obstacle to green hydrogen is its price, which is three to eight times higher than the price of grey hydrogen. This is why many countries, including Japan, China, the United States, and the EU, have presented hydrogen strategies that include government financing in R&D to lower hydrogen costs.
According to global energy policy expert Julio Friedmann from Columbia University, we could split hydrogen costs in two major groups: Renewable energy costs would comprise 55 percent, while electrolyzers would take up 30 percent. For countries with cheap and abundant renewable energy, this transformation could allow them not only to fully decarbonize their economies but also become energy exporters in the future. In addition to this, these could also attract high-energy consuming industries like steel, cement and chemicals production.
A “carbon-free exporter map,” It shows which countries have the highest potential for cheap renewable energy production, and therefore are most likely to lead green hydrogen exports in the future.
Belén Idonella, based on data from The Hydrogen Strategy for Canada.According to Corbeau, some of the countries looking at green hydrogen happen to be some of the world’s biggest fossil fuels exporters, such as Saudi Arabia and Australia. “I would keep an eye on the Middle Eastern countries because they seem quite vocal about their ambitions recently,” she said. “Also North African as well as Latin American countries like Brazil, that have also large biomass potential, which can be used for hydrogen production.”
A big question mark, she added, is China, which is a key importer of oil and gas, but could be self-sufficient in terms of hydrogen. “That would be a huge difference with the current energy trade picture,” she said.
Turning a Country Into a Test Lab
One particularly intriguing country throwing its hat in the ring is Chile. Andrea Moraga Paredes is the managing director of Continua Soluciones and executive director of H2 Chile, a consortium of companies dedicated to the promotion and development of renewable energies and green hydrogen in the region. She told The Daily Beast that “Chile’s potential for renewable energy production is 70 times the current installed capacity, and if we use that capacity we can reach a very competitive price for green hydrogen.”
Because of Chile’s particular, narrow shape, most green hydrogen production plants will be located close to the ports where it will be transported. This is expected to make the country’s hydrogen prices more competitive than prices from countries located closer to consumption points but with more expensive logistics.
“Chile has been said to be the best country to invest in regarding renewable energies, not only due to its geophysical conditions but also its developed port infrastructure, green hydrogen development policy, and energy regulations for the international market,” said Moraga Paredes. Green hydrogen projects in Chile have tripled since 2020, reaching an amount higher than 60 as of November 2021. The projects include green hydrogen production for synthetic fuels production, mobility, injection into natural gas pipelines for domestic and commercial use (in a blend that will be at least 20 percent hydrogen), and green ammonia production.
Whether by intention or not, Chile is positioning itself to act as something of a case study for what happens when a country goes all-in on green hydrogen investment. Experts will be keenly observing the country to see whether it is able to overcome the obstacles that have thus far held back green hydrogen projects.
Green hydrogen projects under development in Chile.
H2 ChileIn November 2020, Chile released its green hydrogen national strategy, which contemplates total investments of 330 billion dollars by 2050. Chile is expecting to have the cheapest hydrogen of the market by 2030 and to reach exports equivalent to 10 percent of the country's GDP. The country has already signed agreements with Amberes Port (Belgium), Port of Rotterdam, South Korea and Singapore for hydrogen exports in the future.
According to Andrea, “all the technological gaps are already solved, there are existing solutions and that’s why there are green hydrogen projects working in different parts of the world. The biggest challenge we face today is to lower the costs of renewable energy and achieve large-scale electrololyzers production.”
The sun strikes the Earth with more power in a single hour than the planet uses over the course of a whole year. Perhaps one day in the far future we’ll have a better idea of how to harness all that energy. For now, green hydrogen could be the missing link to storing, transporting, and using renewable energies 24/7, without the need for batteries. Reaching a carbon-neutral world in three decades isn’t an impossible task, and perhaps it’s some of the smaller energy players of the world who we can turn to for leadership.
