Green hydrogen, the power of the future?
With a view to fighting climate change, any alternative to fossil fuels represents progress, and the search for them has become a priority for governments and businesses. The production of energy using renewable sources or the electrification of transport, which have become priorities over the past decade, still pose challenges when it comes to making their use more widespread and thus getting rid of the most polluting energies. In the race to find their replacement, green hydrogen is emerging as a promising option. However, as Alejandro García-Gasco, head of this field at MAPFRE Global Risks, explains in this interview, it is still “in its infancy.”
Hydrogen has already been put to industrial use for decades, although not in what is known as its “green” format. This gas, which is light and highly flammable, is not found as such in nature and has to be separated by means of a chemical process, which uses a significant amount of energy. This process determines its environmental impact: “gray” H2, by far the most widely used today, is obtained from fossil fuels, mainly natural gas, which is not a clean source of energy. “Green” H2, on the other hand, is extracted via water electrolysis, using renewable energy as part of the process. In short, hydrogen is only as clean as its extraction method.
Green hydrogen shows great potential because, as well as not emitting CO2, it can also be stored, thus solving one of the great challenges facing renewable energies. However, is its large-scale use feasible? What is its current status and what is needed to boost its use?
Alejandro García-Gasco Caboblanco, a public works engineer and technical head of the Engineering Area at MAPFRE Global Risks, MAPFRE’s large risk unit, helps us answer these questions. Through this unit, MAPFRE is the first Spanish insurance company to form part of the Spanish Green Hydrogen Association, which promotes the development of this energy vector.
What is the current employment status in the green energy industry?
To consult the current situation and the forecasts being made in relation to green hydrogen, it is necessary to understand the decarbonization frameworks and time frames. The goals set at the most recent climate change summit in Glasgow can be summarized in the commitment to reduce CO2 emissions by 45% by 2030 (compared to 2010) and to achieve zero emissions by 2050.
You could say that the clean hydrogen industry is in its infancy. In 2020, global demand for hydrogen came to 90 million tons (Mt), which were produced almost exclusively using methods generating pollution (96%). The forecast for 2030 is that clean hydrogen generation, using electrolysis and carbon capture methods (known as “blue” hydrogen) will amount to 17 Mt. However, 696 Mt are needed to achieve decarbonization targets in an average scenario by 2050, the deadline for achieving zero emissions.
Which sectors is it ready to be rolled out in?
Without a doubt, industry is best placed for this technology to be implemented.
The first strategy adopted, through which green hydrogen can contribute to decarbonization quickest and most effectively, is replacing the hydrogen currently generated by releasing CO2, which is used on a massive scale in industrial processes. The two sectors that account for almost 90% of hydrogen use are oil refinery and fertilizer production.
Secondly, we will be able to observe processes that release high amounts of CO2 being replaced with alternatives based on clean hydrogen. A good example is the steel industry and the switch from coal used in the production process to hydrogen.
These are the uses that we are currently seeing, although still on a relatively small scale. Other uses in the industrial world include the replacement of hydrocarbons in combustion, both as a heat source in furnaces or boilers and for electricity generation in gas turbines or fuel cells.
How will citizens experience this change in the coming years?
Since industry is the first field in which it will be used, the hope is that in the coming years, the perceived results for the ordinary citizen will be more related to improvements in global environmental conditions rather than changes in their daily lives.
Moving away from industry, mobility is where there are the most expectations when it comes to using hydrogen as a transformative element. In this field, the predictions of what users will see in the coming years are somewhat uncertain. The challenge is to break the vicious cycle of generating demand and the availability of the resource and infrastructures that make it possible to satisfy this demand.
What obstacles must be overcome to make real progress?
The main obstacle is time, the need to decarbonize human activity in the coming 30 years. Although, on a more material level, the challenge is to reduce production and transport costs.
The speed and importance given to reducing these costs depend on multiple factors:
- Political decisions, in the form of incentives, as well as penalties placed on the most polluting resources. And of course, the responsibility States have to make decisions about transportation infrastructures or energy policies, which will undoubtedly affect the cost per kg of hydrogen.
- Private stakeholders, whose investments will have an impact on generation costs and to a lesser extent, transport costs, which will be no less in industrial or large-scale use.
- Technological development, which will consume resources through investment in the “learning” of emerging technologies, increased performance of existing technologies, increased reliability, etc. This development will be encouraged when progress is made with competitiveness in a market that promises to be attractive for private stakeholders (manufacturers, engineering firms, operators, etc.).
This will therefore be a gradual and long-term process
The commitments undertaken and the time it will take to see alternative energies used must be taken into consideration. In the coming decades, we will see a transition process where the commitments to zero emissions will entwine with reality, and situations that are not purely zero emissions will probably coexist; however, these must undoubtedly be valued as positive, as they will help to achieve the end objective.
One example can be seen in the EU decision to regard power generated by nuclear power stations and gas as “green” energy. Aside from being highly politically charged, it is very realistic to assume that our actual capacity to generate enough renewable energy to produce the green hydrogen we need is limited.
As part of the development of hydrogen, the insurance industry will be particularly relevant from a safety perspective. What challenges does this pose?
As mentioned previously, the use of hydrogen in industrial processes is by no means new; we have the knowledge and technology to safely operate systems that use H2 under the conditions (mainly pressure and temperature) that current developments handle.
The challenges posed moving forward in relation to safety will be a result of how technology evolves and how hydrogen is employed in new ways.
- Operational risks (human error) when exporting its management from industrial environments where safety standards are high, to other sectors where there is less knowledge or awareness of the risk of fire and explosion.
- The risks inherent to developing technologies. For example, in the use of new types of electrolyzers.
- Risks of scaling existing technologies.