Green Technology

New US Hydrogen Technique: Incorrect Division, Incorrect Authors

The US Division of Vitality (DOE) is in an fascinating spot within the transformation to a low-carbon financial system. 55% of its finances is for nuclear vitality, however many of the USA’s 100 or so reactors are growing older out and all however a pair can be off the grid by 2035. There actually aren’t any plans to construct 100 new nuclear reactors within the States because the nation doesn’t have the situations for profitable nuclear rollout any extra, and the present hope of SMRs will most likely fail to ship.

Whereas over half of the DOE finances is concentrated on nuclear, the USA is realistically going to interchange the overwhelming majority of nuclear technology with renewables, further transmission — particularly HVDC — and storage, similar to virtually each different nation on this planet. All of these applied sciences are within the DOE’s remit as properly. To this point so good, though the paperwork and inner fiefdoms will undoubtedly be sluggish to just accept this.

However the DOE additionally offers with fossil fuels as a minority of its portfolio. It has a big portion of its finances and employees who cope with coal, oil, and fuel. That is probably the place a part of the issue lies with its lately launched draft hydrogen technique.

On condition that Biden’s Inflation Discount Act (IRA) has already had a damaging impression on European additionality guidelines for inexperienced hydrogen electrolysis on that continent, it’s fascinating that the technique for hydrogen nonetheless has moist ink. The American mannequin is subsidies for manufacturing inexperienced hydrogen to deliver its value down nearer to black and grey hydrogen, and that cash talked, with main European gamers making it clear that they’d decamp to the USA. So, grid electrical energy for hydrogen in Europe, no requirement to arrange PPAs for enough wind and photo voltaic to cowl the demand. Pity.

So let’s speak about what an excellent technique is. I’ve learn the overwhelming majority of technique books on the market — occupational hazard for a strategist — and definitely all of the regularly cited ones or those thought of necessary, aside from Clausewitz’ On Warfare. There are actually solely two good broad books on technique, Solar Tzu for navy issues and for non-military issues Remelt’s

However this evaluation is distinctly within the non-military technique camp, and so I’ll use Remelt’s kernel of fine methods to border my ideas on the DOE hydrogen technique.

“Technique is designing a option to cope with a problem. A great technique, due to this fact, should establish the problem to be overcome, and design a option to overcome it. To do this, the kernel of an excellent technique comprises three components: a prognosis, a guiding coverage, and coherent motion.”

The prognosis is the important thing factor right here. What’s going on have to be clearly understood. Empirical actuality is vital to good technique.

That is my projection of hydrogen demand by means of 2100, iterated just a few instances. I take advantage of it to help main institutional buyers, VCs and renewable deployment organizations to get their technique for the approaching decade of investments, resourcing and motion plans into the precise place.

What’s the obvious factor about this projection? Hydrogen demand is shrinking, not rising for a lot of the approaching a long time. Why? As a result of hydrogen isn’t a decarbonization answer, it’s a world warming drawback.

Black and grey hydrogen is a CO2e drawback within the vary of all of world aviation. Job one is to cease digging holes, and hydrogen manufacturing right now is a giant shovel. It’s all from fossil fuels right now, with CO2e emissions from upstream pure and coal mattress methane leakages and CO2 from steam reformation or coal gasification from 12 to over 35 instances the mass of CO2e as hydrogen manufactured.

And the most important chunk of it’s utilized in fossil gasoline refining, oil refineries to be particular, the place it’s used largely to desulphurize heavy crude like Alberta’s product and likewise for hydrotreating which is used to stabilize fascinating aromatics, a a lot smaller quantity however excessive worth market. That’s about 50 million of the 120 million tons of pure and syngas blended hydrogen we eat right now, or 42%. The second largest chunk is for ammonia-based fertilizers, about 33 million tons, or round 28%. Refinery use has to largely go away if we wish to deal critically with international warming. Ammonia-based fertilizer use has to decrease radically as properly, by means of the 4 tendencies or methods of shifting subsistence farmers to city employment, precision agriculture, low-tillage agriculture, and agrigenetics options comparable to Pivot Bio’s enhanced nitrogen fixing microbes.

Hydrogen shouldn’t be used for vitality right now. It’s utilized in industrial processes to refine vitality carriers, and it’s utilized in industrial processes to fabricate fertilizer. The opposite makes use of embody hydrogenation of vegetable oil for edible oil merchandise and a bunch of different issues.

But it surely’s not a provider of vitality proper now. Which begs the query:

Why is the US Division of Vitality being tasked with drafting the hydrogen technique?

The position of duty presupposes the reply, that hydrogen can be used sooner or later as a provider of vitality. And there’s little cause to consider that’s true.

This makes the DOE a questionable place to place a hydrogen technique. By definition, they’ll’t assist however view it as an vitality provider. It’s their complete paradigm.

It makes extra sense to place inexperienced hydrogen as an industrial technique, one thing touted by the Biden Administration as being core to what they’re attempting to realize with their five-pillar industrial coverage. These pillars are provide chain resilience, focused public funding, public procurement, local weather resilience, and fairness. It’s not dangerous, with a extra balanced perspective on China than most US governmental materials today.

Placing hydrogen into the DOE was the fallacious alternative. The technique most likely ought to have been within the palms of the Division of Commerce (DOC), not the Division of Vitality, and the DOC ought to have requested for enter from the DOE and Division of Transportation (DOT) the place acceptable. That ship has sailed, nevertheless, and certain for the standard causes on the subject of hydrogen, lobbying from the fossil gasoline trade and ranging from the fallacious paradigm.

And so, there’s some good things within the draft and lots of stuff that’s simply off base, a bunch of which can critically muddle success with decarbonizing hydrogen.

The DOE authors get a few of this proper. The primary couple of issues that they recommend within the demand part, “Technique 1: Goal Strategic, Excessive-Affect Makes use of of Hydrogen,” make excellent sense. We use lots of methanol and ammonia in trade and agriculture, it’s all made with black or grey hydrogen right now, and we have to change that with inexperienced hydrogen. And so they level out the potential for the usage of hydrogen in metal making to cut back iron ore as a substitute of coal (with out recognizing the efforts round utilizing electrical energy instantly for that objective),

However then they fall off the rails quickly. First, they make the frequent mistake that solely burning gases or liquids can present prime quality warmth over 300° Celsius. That is an odd mistake when the USA has made 70% of its metal from scrap in electrical metal minimills for a few a long time, and people use electrical arc furnaces that present 1,500-3,000° Celsius high-quality warmth. Equally, electrically-powered aluminum smelters run at 800° Celsius. Presumably folks within the DOC know this, however the folks within the DOE writing the technique are oil, fuel, and coal heads who assume that you need to burn gases or liquids for high-quality warmth. This simply isn’t true, and it’s a serious failing within the prognosis part of the kernel.

You possibly can’t get technique proper in the event you don’t begin with actuality.

Sexy / Unsexy, Practical / Impractical quadrant chart for residential, commercial and industrial heat sources by Michael Barnard, Chief Strategist, TFIE Strategy Inc.

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Sexy / Unsexy, Practical / Impractical quadrant chart for residential, commercial and industrial heat sources by Michael Barnard, Chief Strategist, TFIE Strategy Inc.

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Horny / Unsexy, Sensible / Impractical quadrant chart for residential, business and industrial warmth sources by Michael Barnard, Chief Strategist, TFIE Technique Inc.

Warmth is necessary throughout the financial system, however industrial warmth will just about all the time be higher equipped by electrically powered options sooner or later. There are a few industrial processes comparable to cement clinker kilns the place I perceive there’s a selected worth in jets of flame, however these are the exception, not the rule. An industrial coverage from the DOC would extra probably begin with the necessity for warmth, and never begin with the false assumption of a requirement for a liquid or gaseous gasoline.

As chemical course of engineer Paul Martin, who has been designing modular chemical processing plans for purchasers globally for 3 a long time, has advised me on a couple of events, all the pieces he does makes use of electrical energy up till the purpose that cost-benefit analyses present that fossil fuels are cheaper when the ambiance is allowed for use as an open sewer.

CT Projection of Grid Storage Capacity

Projection of grid storage capability by means of 2060 by main classes by Michael Barnard, Chief Strategist, TFIE Technique Inc.

Then there’s hydrogen for long-duration storage. One of many head-scratchers in my dialogue with Jigar Shah, the DOE’s director of its Loans Program Workplace, was the $504 million mortgage for a hydrogen salt cavern storage and electrical energy technology facility on the location of an previous coal plant in Utah. The assertion was that it reused the transmission to LA, so it was good. However they’re placing fuel technology on the location to interchange the coal, that can require a bunch of latest fuel pipeline to produce the fuel, there isn’t a feeder transmission to the location to deliver renewables to it to fabricate inexperienced hydrogen, and inexperienced hydrogen is deeply inefficient spherical journey. It’s what obtained authorized as Utah didn’t need the coal city to vanish, however holding a rural city with a few thousand folks alive after its main financial objective is gone isn’t a strategically sound vitality or decarbonization answer.

Like each different main nation on this planet, the USA has lots of grid storage right now within the type of pumped hydro. That expertise is by far the most important type of grid storage on this planet, it’s by far the most important type of grid storage beneath building, and single pumped hydro services commissioned in 2022 dwarf all battery storage on the grid globally. It’s the suitable scale and expertise for grid storage. Hydrogen is only a dangerous expertise by comparability for this objective.

Quadrant chart of sexy vs practicality by author

Quadrant chart of horny vs practicality by Michael Barnard, Chief Strategist, TFIE Technique Inc.

Then there’s hydrogen and artificial fuels for vehicles and buses, additionally touted within the DOE technique. This in a world the place there are 500,000 battery-electric buses on the roads of China, the place there are roughly the identical variety of battery electrical vehicles, the place new battery-electric semis are being delivered from a number of producers right now, and the place each hydrogen bus and truck take a look at program has confirmed that they don’t seem to be financial in comparison with battery-electric, with potential en route grid ties or inductive charging in locations.

Table of costs and carbon for ground transportation fuel alternatives including diesel, synthetic diesel and biodiesel

Desk of prices and carbon for floor transportation gasoline alternate options together with diesel, artificial diesel and biodiesel by Michael Barnard, Chief Strategist, TFIE Technique Inc.

It’s a must to be wanting on the world by means of diesel-powered glasses to imagine that burning gases or liquids in vehicles and buses is an acceptable alternative in a technique when battery-electric is an choice. Artificial fuels are a lot greater CO2e and far greater value. It’s largely simply economics, and gasoline prices are about 21% of the prices of trucking. I assessed this end-to-end in 2018 and 2019 in taking a look at Carbon Engineering’s direct-air seize air-to-fuel plans, and the economics and expertise haven’t budged since then.

Sexy / unsexy, practical / impractical quadrant chart of marine transportation decarbonization by Michael Barnard, Chief Strategist, TFIE Strategy Inc.

Horny/unsexy, sensible/impractical quadrant chart of marine transportation decarbonization by Michael Barnard, Chief Strategist, TFIE Technique Inc.

There’s a unique story in marine transportation, one other goal for hydrogen within the DOE technique. Maybe if the technique originated within the Division of Transportation, which is accountable for marine delivery, there could be some affordable materials right here. Nonetheless, there are numerous, comparable to Maersk, who’re attempting to sq. the circle of artificial fuels manufactured from inexperienced hydrogen, so maybe not.

There are just a few key factors it’s doable that the DOE authors don’t know. The primary is that 40% of all deepwater delivery is for bulk oil, fuel, and coal shipments between continents. That’s all going away. Subsequent is that 15% of all deepwater delivery is for uncooked iron ore, heading to the identical ports as lots of the coal to fabricate metal. That’s going to be considerably decreased. Different bulk items comparable to grains are already containerizing. The goal is container delivery and it’s smaller, in different phrases.

Subsequent, the query as all the time is how a lot of delivery can electrify. The reply is that each one inland delivery and about two-thirds of close to shore delivery can run on batteries, both completely put in within the boats and charged as Corvus Vitality has been doing for over a decade, or by placing the batteries in customary delivery containers (TEU) and swapping them out in ports, an answer additionally appropriate for trains which I’ll be coming to. TEUs with batteries put in are already being delivered globally for grid storage by Tesla and Wärtsilä, as I mentioned with the latter firm’s international VP for vitality storage and optimization, Andy Tang, just a few months in the past.

Marine shipping megatonnes fossil fuels before refueling

Marine delivery megatonnes fossil fuels earlier than refueling, chart by Michael Barnard, Chief Strategist, TFIE Technique Inc.

That solely leaves the declining deepwater delivery phase that requires an answer, and it’s deeply unlikely to be hydrogen or artificial fuels. In my evaluation of different fuels for marine delivery, I settled on biofuels as the best chance for the dominant answer. My projection of marine vitality necessities for that house by means of 2100 makes it clear that international carrying capability of stalk cellulosic biofuels is greater than sufficient for the truly exhausting to refuel lengthy haul segments of each aviation and delivery.

Projection of aviation fuel demand by type through 2100 by Michael Barnard, Chief Strategist, TFIE Strategy Inc.

Projection of aviation gasoline demand by sort by means of 2100 by Michael Barnard, Chief Strategist, TFIE Technique Inc.

And so, to aviation, one other space the DOE thinks is a goal for inexperienced hydrogen demand. From the identical Carbon Engineering evaluation cited above, and in my assessments of refueling choices for that phase of transportation, it’s clear that hydrogen shouldn’t be match for objective instantly, and artificial fuels can be far more costly than SAF biofuels.

Table from Carbon Engineering synthetic fuel case study by author

Desk from Carbon Engineering artificial gasoline case research by Michael Barnard, Chief Strategist, TFIE Technique Inc.

What can’t be electrified with ever-improving batteries will use SAF biofuels. They’ve been round since 2011, most aerospace OEMs are certifying their plane on them, and they’re flying blended or solely SAF biofuels in take a look at routes with actual cargo and passengers right now. However because the desk reveals, so long as Jet A-1 and the like are cheaper, that’s what aviation will use. Fortunately that’s altering in a number of components of the world because the bizarre untaxed situation of jet fuels ends, one thing I explored just a few months in the past.

After which there’s rail, one other goal the DOE technique considers to be excessive worth. China has constructed 25,000 miles of high-speed, grid-tied, electrified freight and passenger rail previously 15 years, reaching 93% of home cities, and it’s connecting neighboring nations into the community. Germany simply introduced that it’ll not construct any extra hydrogen rail after the 50-mile take a look at route, as financial research present it’s 3 instances as costly as grid-tied/battery hybrid, and virtually that rather more costly than simply battery-electric. All freight prepare engines within the USA are already diesel-electric hybrid, and grid-tying them with overhead traces is a standard apply globally.

As soon as once more, these battery-filled TEUs are excellent parts for a battery-electric prepare system, rechargeable at current transshipment factors, the place the cranes are going all electrical as properly. Having had CN Rail as a shopper a decade in the past, checked out international container delivery, and checked out container port administration software program, it’s comparatively trivial to have TEUs crammed with batteries charging in container transshipment services and dropped onto ready prepare automobiles or into the holds of container vessels.

Lastly, the technique references residential and business heating as a goal for hydrogen. I’ve explored this (see the heating quadrant chart above), as have dozens of others, and hydrogen could be each vastly dearer than pure fuel heating and a lot much less secure. When air, floor, and water-sourced warmth pumps are already refueling very giant business and residential buildings, working with coefficients of efficiency of three to five, being inbuilt gigafactories in Texas, and no hydrogen furnaces or stoves for residential or business use can be found for buy or licensed to be used, you actually need to wish to burn one thing to think about hydrogen instead.

I’d return to this to handle the wrong-headed assumptions concerning the necessity to transport hydrogen by pipeline, rail and ship, one other set of paradigm errors the DOE technique makes. Suffice it to say that just about all hydrogen is manufactured at level of demand right now as a result of it’s so troublesome and costly to move, and that its low vitality density by quantity and tiny molecular dimension signifies that it’s very costly to move various hundred meters. I’ve assessed pipeline and delivery prices for hydrogen, they usually make no sense in comparison with placing renewable electrical energy into HVDC traces, a standard expertise globally, with a 3rd undersea HVDC interconnector getting in within the UK, tens of hundreds of kilometers of HVDC in China, Morocco to UK HVDC beneath building, and Australia to Singapore HVDC proposed.

The way forward for vitality transmission is electrical energy flowing down excessive voltage direct and alternating present traces, not transferring molecules.

The rationale that the DOE technique, if it persists on this kind, can be so problematic for the USA is that it first diffuses the eye of hydrogen as a decarbonization drawback, so it received’t be addressed promptly. Second, it’s going to trigger lots of organizations to waste lots of money and time constructing infrastructure to fabricate hydrogen in places the place there can be no demand. In some instances, the hydrogen will have the ability to be repurposed for high-value makes use of comparable to ammonia-based fertilizers. However in lots of instances, it is going to merely be an costly white elephant and moved at nice expense to someplace extra helpful.

So why is the USA making this clearly poor alternative? Why is hydrogen positioned within the DOE versus the DOC? Why are all of those clearly dead-end use instances thought of to be “Strategic, Excessive-Affect Makes use of of Hydrogen,” because the DOE technique asserts?

Nicely, the fossil gasoline trade and governments with giant tax and royalty revenues are lobbying exhausting to make hydrogen a ‘substitute’ for fossil fuels. They know that except hydrogen does the heavy lifting, their fossil gasoline reserves have zero financial worth. As Michael Liebreich likes to level out, the fossil gasoline trade can’t lose by pushing hydrogen. They’ll both delay actual local weather motion, or they’ll get lots of governmental cash to make blue hydrogen out of their fossil gasoline reserves.

Oh, did I point out the US DOE hydrogen technique can be throughout manufacturing hydrogen from fossil fuels with carbon seize and storage bolted on? Are you shocked?

The US hydrogen technique was positioned within the fallacious federal division because of the fallacious framing. It was put within the palms of people that cope with fossil fuels all day lengthy and have a paradigm of burning them for vitality, not a paradigm of electrical energy for vitality. It fails Remelt’s take a look at for the very first thing that makes an excellent technique, acceptance of empirical actuality, and so its ideas and actions can be failures as properly.

The USA ought to return to the drafting board, and rapidly. I’d be completely happy to help them.


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