When we talk about green hydrogen and its potential future and opportunities, we have to highlight to barriers of green hydrogen production scaling up.
We have to know that green hydrogen actual use is still very limited. Each year around 120 million tonnes of hydrogen are produced globally, of which two-thirds are pure hydrogen and one-third is in a mixture with other gases (IRENA, 2019a). Hydrogen output is mostly used for crude oil refining and for ammonia and methanol synthesis, which together represent almost 75% of the combined pure and mixed hydrogen demand.
Today’s hydrogen production is mostly based on natural gas and coal, which together account for 95% of production. Electrolysis produces around 5% of global hydrogen, as a by-product from chlorine production. Currently, there is no significant hydrogen production from renewable sources: green hydrogen has been limited to demonstration projects (IRENA, 2019a).
Green hydrogen faces barriers that prevent its full contribution to the energy transformation. Barriers include those that apply to all shades of hydrogen, such as the lack of dedicated infrastructure (e.g. transport and storage infrastructure), and those mainly related to the production stage of electrolysis, faced only by green hydrogen (e.g. energy losses, lack of value recognition, challenges ensuring sustainability and high production costs).
1- HIGH PRODUCTION COSTS: Green hydrogen produced using electricity from an average VRE plant in 2019 would be two to three times more expensive than grey hydrogen (see Box 1.2). In addition, adopting green hydrogen technologies for end uses can be expensive.
2- LACK OF DEDICATED INFRASTRUCTURE: Hydrogen has to date been produced close to where it is used, with limited dedicated transport infrastructure. There are only about 5000 km of hydrogen transmission pipelines around the world (Hydrogen Analysis Resource Center, 2016), compared with more than 3 million km for natural gas.
3- ENERGY LOSSES: Green hydrogen incurs significant energy losses at each stage of the value chain. About 30-35% of the energy used to produce hydrogen through electrolysis is lost (IRENA, forthcoming). In addition, the conversion of hydrogen to other carriers (such as ammonia) can result in 13-25% energy loss, and transporting hydrogen requires additional energy inputs, which are typically equivalent to 10-12% of the energy of the hydrogen itself. Using hydrogen in fuel cells can lead to an additional 40–50% energy loss. The total energy loss will depend on the final use of hydrogen. The higher the energy losses, the more renewable electricity capacity is needed to produce green hydrogen.
4- NEED TO ENSURE SUSTAINABILITY. Electricity can be supplied from a renewable energy plant directly connected to the electrolyser, from the grid, or from a mix of the two. Using only electricity from a renewable energy plant ensures that the hydrogen is “green” in any given moment.
Grid-connected electrolysers can produce for more hours, reducing the cost of hydrogen. However, grid electricity may include electricity produced from fossil fuel plants, so any CO2 emissions associated with that electricity will have to be considered when evaluating the sustainability of hydrogen. As a result, for producers of hydrogen from electrolysis, the amount of fossil fuel-generated electricity can become a barrier.