By Dietmar Siersdorfer, Managing Director, Siemens Energy Middle East and UAE.
The lightest element in the periodic table, the most abundant chemical substance in the universe, and the long-promised secret weapon to win our battle against climate change. These are all common features of Hydrogen. A clean-burning molecule, that can help to decarbonize a range of sectors that have proved hard to clean up in the past.
Hydrogen has been touted as the ‘fuel of the future’ since the 1970’s but five decades later, that vision has yet to materialize. Perhaps part of the problem is using the label ‘future’. That always gives us the illusion that we have the luxury of time. But today, in a post-pandemic world where the concentration of carbon dioxide in our atmosphere is the highest it has ever been in human history, it seems like that future has arrived.
With green hydrogen gaining traction around the world and in the region, it is the right time to make the dream of a cleaner future a reality today. So what are the three golden rules we need to remember to make that happen?
1. Being realistic
With more and more nations committing to green hydrogen strategies and new ground-breaking projects taking place around us, it is important to not lose track of where we stand in this journey. We are still at the very beginning. Knowing where we stand means knowing exactly what needs be done to reach our targets. The reality is that we still have many challenges to overcome when it comes to the production, transportation, and storage of an element like Hydrogen.
It all starts with the conundrum of ‘green’ hydrogen, which can be produced from water with electrolysis, an energy-intensive but carbon-free process if powered by renewable electricity. That sounds like a perfect solution, but of course there’s a catch. According to Bernstein analysts, hydrogen made from fossil fuels currently costs between $1-$1.8/kg. Green hydrogen can cost around $6/kg today, making it significantly more expensive than the fossil fuel alternatives. However, as is the case with all production processes, increased demand could drastically reduce these costs.
The transport and storing of hydrogen are also one of the main stumbling blocks in the road to a hydrogen-based economy. The nature of H2 as an element particularly makes this difficult. Its flammability, low density as a gas and liquid, and high diffusivity pose serious safety risks throughout every step of the distribution mechanism. Its transportation, storage, and final delivery to the point of use also incur significant costs. Other chemical alternatives for hydrogen storage, such as methanol and ammonia, could be the answer due to their high storage density and less electricity demand for storage. Some of the infrastructure required to pull this off is already in place because hydrogen has long been used in industrial applications. However, we are still lacking the means to support widespread consumer use of hydrogen as an energy carrier.
2. Building on momentum
Hydrogen has been in use for many decades in sectors like refining and chemical industries. However, its use as an energy source has started receiving increased interest in recent years. Over the past year alone, we saw great progress with industrial giants like Germany, Netherlands, Britain, Australia and Japan, announcing hydrogen strategies.
2020 was dubbed ‘The Year of Green Hydrogen’ and it’s crucial to build up on this momentum. At Siemens Energy we are also playing a massive role, with our partners, in steering this momentum toward the region. One of the major milestones occurred last week as we inaugurated the first industrial scale, solar-driven green hydrogen facility in the Middle East and North Africa in partnership with Expo 2020 Dubai and DEWA. The integrated facility is regarded as a pilot project and was developed with electrolysis, storage, and re-electrification capabilities, to maximize the benefits of the pilot project. Daylight solar power from the Mohammed bin Rashid Al Maktoum Solar Park, where the facility is located, will enable the production of around 20.5 kilograms of hydrogen per hour at 1.25MWe of peak power. This is the first time green hydrogen is being produced at an industrial scale in the region. How did we make this happen? Partnerships. Collaboration between the private and public sectors is the only way forward to transform the energy sector. The real value of these pilots is not in the numbers, but in the lessons that we will learn along the way that will guide us in the development of a green hydrogen industry across the region.
3. Learning from solar and wind
The good news is that we have been on a similar path before. Once upon a time, the integration of solar and wind power into the energy mix felt like a sought-after dream. Today, we are emerging from a record-breaking year for renewable energy in 2020. New renewable energy capacity – primarily solar and wind – made up a whopping 90 percent of the power sector’s growth globally last year, according to the International Energy Agency. And it’s not a one-off. The agency forecasts renewables to again account for 90 percent of the power sector’s expansion in 2021 and 2022.
These numbers would have sounded like pure fiction only a decade ago. But here we are. We have many lessons to learn from the journey of solar and wind energy, which can inform our quest for a hydrogen-fueled world. Going back to my first point, it all starts with setting ambitious and realistic targets that are grounded in comprehensive and integrated national energy plans. National plans and roadmaps mean government backing which has proven momentously integral in the growth of the renewable energy sector. Wind farms and solar parks have become an indispensable part of the generation expansion plans of almost every country in the world. That came after years of consistent planning, raising awareness and commitments made on global level from the major stakeholders in the industry.
Hydrogen has the potential, and certainly the merits, to get there eventually but it is in our hands to make that possible. Are we doing enough? That’s a question every private and public entity should be asking themselves. It all starts with asking the right questions.