The colorful world of #HY-TECH (HYdrogen TECHnology)

Continuation from the previous article - #Hy-Tech

I believe that the book 'Sapiens' by Yuval Harari is an exceptionally well-written and thought-provoking work that eloquently tells the story of human evolution. It meticulously traces the steps that have brought us to our present-day society and clarifies the reasons behind the structure of our civilization. However, what sets this book apart is its focus on the future of humankind. The author skillfully lays out the possibilities and challenges that we may face and poses the fundamental question that has intrigued me the most: “Where is humanity headed and what is its purpose despite remarkable accomplishments?”. I will leave it to your philosophical imagination to find answers to that question.

It is awe-inspiring to celebrate humanity's achievements, but it's disheartening to acknowledge that these accomplishments have come at the expense of damaging our environment. This situation prompts us to question where these remarkable feats of humans will lead us in the future. It's highly unlikely that anyone can answer this question with certainty. We have progressed in a manner that we believe is appropriate, but it's essential to consider the consequences of our actions. Ultimately, we must determine where we will go from here and what our purpose will be.

Global growth is unstoppable! To put that in the numbers, in the past 30 years, the world's electricity consumption has increased by about 2.5 times (SOURCE: Enerdata- World Energy & Climate Statistics – Yearbook 2023), while the population and its density have only increased by approximately 1.3 times. In 2022, the G20 nations accounted for roughly 80% of global energy consumption. Meanwhile, carbon dioxide emissions related to energy have risen from around 20 GtCO2 to 33.8 GtCO2, a 70% increase (SOURCE: Enerdata- World Energy & Climate Statistics – Yearbook 2023). During the same period, the world's GDP has grown from approximately USD 25.5 trillion in 1992 to USD 100 trillion in 2022, representing a four-fold increase (SOURCE: The WorldBank. GDP (constant 2015 US$)). The current macro projections show that the global output will reach approximately USD 218 trillion by 2050 (SOURCE: Goldman Sachs Economic Research – The path to 2075, Dec 2022). Energy is the key driver for achieving future growth!

In my previous article, I highlighted the urgent need to address climate change and explained why Hydrogen is the most promising and viable low-cost alternative to fossil fuels. I emphasized the need for a swift transition to hydrogen as our primary energy source to meet humanity's ever-growing, insatiable energy needs. This rapid shift towards hydrogen is critical to slow down the adverse effects of climate change, and it could even help us reverse the impending disaster in the long run, which is only possible if we can rapidly accelerate the transition to green energy NOW. The current transition rate to GREEN energy is significantly slower than required to cope with climate change. To measure the rate of green transition, we must look at how we are transforming the Levelized Costs across the following gears of the Hydrogen Transition Engine gearbox:

The emergence of "green electrons" significantly changes the global energy infrastructure. These electrons are produced by various non-polluting sources like wind and solar power that are used for Hydrogen production. They travel through an electric grid and can be stored in batteries or chemical cocktails for future use. Hydrogen could become the global economy's primary energy source, creating "green molecules" and promoting clean and sustainable industrial processes.

"Green molecules" are a new class of energy carriers that can fill the gaps left by traditional electrification methods. Unlike their carbon-intensive predecessors, these fuels have zero greenhouse gas emissions. They are suitable for decarbonizing heavy industries, long-haul transportation, and specific industrial processes that are primary sources of large-scale pollution. They include Hydrogen, synthetic fuels, and potentially other innovative blends.

The "green bits" are the crucial components of the gearbox of the hydrogen transition engine and are not just digital solutions. They are comprised of tightly integrated and intricate software and hardware ecosystems that transform how we generate, manage, and consume energy. Their rapid proliferation into our energy system will profoundly impact clean energy production, intelligent consumption, and optimized grid operations. They encompass various aspects of our energy systems, including Smart Grid, Building Automation, Industrial IoT, Transport Electrification, Smart Homes, and someday even Smarter Cyborg Humans.

There are three cost indicators that we must consider when determining the rate of the GREEN energy transition:

1. When determining the most viable methods of electricity generation, policymakers and researchers often rely on a measure known as the Levelized Cost Of Energy (LCOE). This calculation takes into account the average total cost of constructing and running a power-generating asset over its lifespan. Then it divides that amount by the total energy output of the asset during the same timeframe. By utilizing the LCOE equation, stakeholders can gain valuable insight into the economic implications of various power systems.
2. The Levelized Cost of Storage (LCOS) is a widely used metric that helps determine the cost of energy storage systems per unit of energy consumed or produced. This calculation method considers various factors, including initial expenses, ongoing operational costs, and the total amount of energy that the system can store and discharge over its lifespan.
3. The Levelized Cost of Hydrogen (LCOH) is a key indicator that determines the cost of producing 1 kg of Green Hydrogen, considering the investment costs and operating expenses needed for its production. The LCOH is calculated by dividing the total cost of producing hydrogen by the total amount of hydrogen produced during the project's lifespan. This metric is critical for evaluating the economic feasibility of hydrogen production projects.

I will explore this topic further in my upcoming article on HY-Tech Economics. However, for this article, it is essential to grasp that to achieve widespread adoption of hydrogen, we must focus on reducing these three cost indicators lower than those of current fossil fuels-based energy sources. These costs are significant barriers to achieving a tipping point for Hydrogen adoption at scale. However, these costs can be significantly reduced by orchestrating an integrated and collaborative green transition strategy between public, private, and consumer participation.

?The HY-Tech Value Chain

To make Hydrogen commercially viable and widely adopted, a complex ecosystem must be established around its production processes. Although we have been producing Hydrogen for the last century, the ecosystem around it has not evolved to compete with or replace the fossil fuel value chain. This ecosystem includes the infrastructure, technology, and logistics necessary for the efficient production and cost-effective distribution of Hydrogen. The current value chain for Hydrogen must be significantly improved and matured to make it a viable and cost-competitive alternative to conventional fossil fuels. The fossil fuel value chain has evolved over the past few decades due to continuous investments in R&D, public policy transformation, cost-efficient production methods, and a strong hydrocarbon feedstock supply chain, which is an efficient last-mile delivery model across the value chain linkages. The good news is that the existing hydrocarbon value chain can be modernized and upgraded at a fraction of the cost, which can be used to store, transport, and distribute Hydrogen. The HY-Tech value chain can be broadly classified into two groups:

1. Power-to-Gas (P2G): Technologies that use electric power to produce gaseous fuel.
2. Gas-to-Power (G2P): Technologies that use Hydrogen gas to produce energy that is applied to various use cases.

The HY-Tech value chain consists of the following primary linkages working seamlessly from the production to the application of Hydrogen:

The diagram below is an example of the intricacies between the linkages in the hydrogen value chain for Japan, which is a pioneer in hydrogen production technologies.

Hydrogen contains a lot of energy per unit of weight, with a lower heating value of 118.8 MJ/kg. However, it has a low amount of energy per unit of volume, which is approximately 3 Wh/L at room temperature and pressure. This makes it difficult to store effectively. Fortunately, various storage technologies are available, such as compression, liquefaction, adsorption, hydrides, and reformed fuels. The choice of technology depends on the specific application, transportation, storage period, and other conditions. It is important to consider these factors when selecting the best storage method for Hydrogen.

In the past, there were no universal standards for hydrogen production, unlike fossil fuels, which were introduced with established standards by organizations like the EPA in the United States in the 1970s. However, during COP-28 held in Dubai, the International Organization for Standardization (ISO) launched a new technical specification (ISO/TS 19870) to achieve harmony, safety, interoperability, and sustainability throughout the hydrogen value chain. The process of adopting and complying with these standards can be complicated. Although publishing the standard is the initial stage, ultimately, adhering to the standards is what matters the most. The energy industry has been using color codes without formal standards to distinguish Hydrogen based on its production sources and methods.

Due to the rapid development of hydrogen production methods and technologies, along with state energy policy reforms and incentives such as green transition tax breaks, renewable tax credits, subsidization, rebates, and consumer use tax credits, cost efficiencies will be gained at scale, resulting in a significant reduction in the Levelized Cost Of Hydrogen (LCOH).

The U.S. Department of Energy (DOE) Hydrogen Shot Summit convened thousands of stakeholders online to introduce the Hydrogen Shot, solicit dialogue, and rally the global community on the urgency of tackling the climate crisis through concrete actions and innovation. The Hydrogen Shot Summit was held virtually on August 31 and September 1, 2021. The US Department of Energy (DoE) has set a target of USD 1/Kg by 2030, which is widely seen as the tipping point to trigger a mass-scale transition from fossil fuels.

BiGS Actionable Intelligence: Widespread adoption of green hydrogen will depend on substantially lower production costs for power-to-gas technologies. New research out of Harvard Business School projects that the life-cycle cost of hydrogen production will approach the $1.0/kg target set by the U.S. Department of Energy for 2030, which will make hydrogen cost-competitive with traditional energy sources derived from fossil fuels.

Glenk, Holler, and Reichelstein’s new paper is based on global observations of investment expenditures and energy consumption of power-to-gas facilities, which are used to produce hydrogen without emitting greenhouse gases. The research also captured the capacity of power-to-gas facilities commissioned worldwide between 2000 and 2020. Based on this data, the authors project that the life-cycle cost of clean hydrogen production will likely fall in the range of $1.6–1.9/kg by 2030, a decline from about $3-5/kg today.

So what can we do with 1Kg of Hydrogen?

• 1 kg of hydrogen contains 33.33 kWh of usable energy, whereas petrol and diesel only hold about 12 kWh/kg
• A fuel-cell electric vehicle with 1 kg of hydrogen can drive approximately?60 miles, compared to conventional vehicles, which get about 25 miles on a gallon of gasoline.
• An extended haul trailer can go up to 7 miles on 1Kg of hydrogen compared to 6 miles per gallon (1Gallon = 3.79 Kg)

Hydrogen, being the lightest and most abundant element in the universe, has several properties that make it an ideal energy source. It is non-decomposing, meaning that it does not break down over time, which makes it a reliable and long-lasting fuel. Additionally, hydrogen is self-igniting, meaning that it burns on its own without an external source of ignition, which makes it easy to use for energy generation.

Moreover, hydrogen is non-oxidizing, which means that it does not react with oxygen to form harmful compounds. This property makes it a safe and clean source of energy as it produces only water when burned. Furthermore, hydrogen is non-toxic, non-corrosive, non-radioactive, odorless, non-contagious, non-teratogenic, and non-carcinogenic, making it the safest energy source available.

Most of the universe is made of hydrogen, is that by accident or by nature's design? a question for you all to ponder.

Looking beyond the costs, the six strategic forces that will enable the GREEN transition.

Successfully transitioning to a greener future powered by hydrogen will require a holistic approach that addresses all six of these strategic forces.

FORCE 1: Transformation of producers and sellers:

• Incentivize investments in hydrogen production:?Implement tax breaks, carbon pricing mechanisms, and other financial incentives to encourage existing and new players to invest in green hydrogen production.
• Promote knowledge sharing and technology transfer:?Facilitate collaboration between established producers and emerging players in developing countries, fostering knowledge transfer and capacity building.
• Develop clear standards and regulations:?Establish robust and transparent standards for hydrogen production, transport, and storage to ensure safety and quality.

FORCE 2: Transformation of consumers and demand:

• Raise awareness and educate consumers:?Launch targeted campaigns to educate the public about the benefits of hydrogen and its role in decarbonization.
• Develop green hydrogen-powered applications:?Invest in research and development of hydrogen-powered vehicles, appliances, and industrial processes to expand the market for green hydrogen.
• Offer attractive incentives for early adopters:?Implement subsidies, tax rebates, or other incentives to encourage consumers and businesses to switch to hydrogen-powered solutions.

FORCE 3: Regulatory transformation:

• Remove regulatory barriers:?Streamline permitting processes and eliminate outdated regulations that hinder hydrogen infrastructure development.
• Implement carbon pricing mechanisms:?Put a price on carbon emissions to incentivize businesses and consumers to choose low-carbon options like green hydrogen.
• Develop international cooperation:?Foster collaboration between countries to create harmonized regulations and standards for hydrogen deployment, promoting a level playing field for the industry.

FORCE 4: Green transformation supply chains:

• Make carbon footprint reduction:?Developing a culture of measuring fiduciary responsibility and reporting carbon footprint across the entire supply chain is crucial for businesses to make informed decisions and ensure environmental sustainability. By doing so, we can not only reduce our carbon emissions but also increase transparency, trust, and accountability, which can ultimately lead to a more sustainable future.
• Supplier sustainability compliance:?Ensure that green hydrogen production is powered by renewable sources like solar and wind to minimize its environmental footprint.
• Develop sustainable transportation solutions:?Invest in efficient and environmentally friendly methods for transporting and distributing green hydrogen.

FORCE 5: Smart deployment of capital for hydrogen research:

• Direct public and private investment towards high-impact areas:?Prioritize research on cost-effective hydrogen production technologies, long-term storage solutions, and integration with existing energy systems.
• Establish venture capital funds and innovation hubs:?Create dedicated funding mechanisms to support early-stage startups and entrepreneurs developing cutting-edge hydrogen technologies.
• Foster collaboration between academia and industry:?Encourage partnerships between universities and research institutions with private companies to accelerate the development and commercialization of new hydrogen technologies.

FORCE 6: Digital infrastructure transformation:

• Develop smart grids and energy management systems:?Implement intelligent systems that optimize hydrogen utilization, integrate it with renewable energy sources, and enhance grid resilience.
• Invest in data analytics and AI:?Utilize data analytics and artificial intelligence to improve forecasting, optimize hydrogen production and distribution, and effectively manage green hydrogen supply chains.
• Promote cyber security:?Ensure the cybersecurity of digital infrastructure throughout the hydrogen value chain to protect against potential threats and vulnerabilities.

By implementing targeted strategies and focusing on six transformative forces, we can speed up the transition to a greener future powered by hydrogen and unlock its potential to combat climate change and achieve sustainable development.