August 11, 2022 • Paul Rodden • Season: 2022 • Episode: 138
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In episode 138, Shell talks green versus blue hydrogen in Europe, and Bloom Energy announces great results on their new electrolyzer. All of this on today's hydrogen podcast.
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Shell talks green versus blue hydrogen in Europe, and Bloom Energy announces great results on their new electrolyzer. All of this on today's hydrogen podcast. So the big questions in the energy industry today are, how is hydrogen the primary driving force behind the evolution of energy? Where is capital being deployed for hydrogen projects globally? And where are the best investment opportunities for early adopters who recognize the importance of hydrogen? I will address the critical issues and give you the information you need to deploy capital. Those are the questions that will unlock the potential of hydrogen, and this podcast will give you the answers. My name is Paul Rodden, and welcome to the hydrogen podcast.
In an article from recharged news.com Rob Watts writes Shell boss high gas prices will make blue hydrogen uncompetitive with green. For some while. Future h2 demand will be driven by its cost compared to hydrocarbons, and how fast transport companies want to decarbonize Ben van Beurden told analysts. Tiny natural gas supplies and soaring prices will encourage green hydrogen schemes and use in Europe while making Blue hydrogen less attractive. This according to the Chief Executive of UK oil major shell, Ben van Beurden said that current high prices are making Blue hydrogen, which is made from methane with most of the carbon captured and stored a little bit difficult.
He says, I think for some while Europe will focus very much on making green hydrogen Ben van Beurden told analysts last week during a call to discuss the company's bumpers second quarter results. And maybe over time, he continued indeed, we'll also look at importing hydrogen, which can then be also blue hydrogen, for instance, if it comes out of gas rich countries, but he pointed out that shell will be driven in the long run by the value of hydrogen and the transportation system. Of course, he says at the moment, there is no hydrogen based transportation system, it has to be built. Ultimately, the value uplift needs to come from building out a hydrogen transportation infrastructure throughout Europe. He continues by saying this will be driven by how competitive hydrogen becomes against middle distillates such as diesel jet fuels and heating oil and how fast transportation companies or their customers want to decarbonize.
He says that they believe there's a tremendous potential there and of course, also a tremendous driver from governments to make these things happen, he says, and I think there's much more determinate for the hydrogen business on how it will develop in Europe than what might happen with natural gas. Last month, shell reached a final investment decision to build a 200 megawatt green hydrogen project at the Port of Rotterdam and the Netherlands. Holland hydrogen one, which shell says will be the largest renewable hydrogen project in Europe Upon completion, and 2025 will use a 200 megawatt alkaline electrolyzer, supplied by Thyssenkrupp, and will be powered by the yet-to-be-built 759MW Hollandse Kust Noord offshore wind farm in the Dutch North Sea. 60 tons of that hydrogen produced each day will be transported about 40 kilometers via pipeline to the company's oil refinery at Shell energy and chemicals port Rotterdam, where it will replace some of the gray hydrogen used to remove sulfur from the crude oil. Although some of the supply it might also be used to power hydrogen trucks. Now the project has been given the greenlight before EU regulations have been finalized, meaning that there is a risk that the hydrogen produced might not be allowed to be labeled as green hydrogen due to proposed rules on additionality.
But that could be a moot point if shell is not selling this hydrogen on the open market. Okay, so some really good insight from Ben van Beurden on the European outlook on green hydrogen versus blue hydrogen. Now, this is more of an obvious outlook, just because of how high natural gas prices are in Europe. Now, here in the United States, where our natural gas prices are so much lower. We have a slightly different outlook on the economics between electrolysis and steam methane reforming with carbon capture. Now, that hasn't stopped so much investment going into green hydrogen here in the United States. But what's so exciting here in the United States is now that the infrastructure bill has passed, that really does open up the floodgates for the hydrogen industry in the US to take a strong foothold and really start building out the infrastructure. But that being said, there is a point that I think needs to be made when it comes to the colors and the different technologies surrounding those colors. And the point that I really want to make here is stop thinking about The colors really start concentrating on the technologies that drive the colors. So if for say I don't cover something that's quote unquote, a blue technology or a blue project getting started, that it means that I don't value that technology. Now, it is true that carbon capture utilization and sequestration or CCUS. Right now is relatively uneconomic. But I also know that there are some big names in the hydrocarbon industry that are putting a lot of money into research and development for that technology.
But also to that point, if you focus too much on the quote unquote, blue technology, which would be grey plus CCUS, you also miss out on a lot of other technologies being developed, that utilize hydrocarbons as their feedstock, but with a different development technology, technologies like methane pyrolysis, or in situ combustion, or different waste to hydrogen technologies, currently in development and coming to market very soon. Now, I'm very supportive. And I made this a point in the past that I support the hydrocarbon industry in embracing hydrogen. I think their feedstock and their legacy technologies. And their propensity for innovation enables them to be quite a leader in the hydrogen transition, because let's not discount what the oil and gas industry has done to lower cost and drive technology in industry over the last 100 years.
And I know for a fact that the super majors are investing heavily in hydrogen technology. So even though you may not see a lot of news coming out about quote unquote, blue hydrogen, there are projects under development, and a lot of money's still being pumped into figuring out the best ways of making hydrogen and solid carbon from hydrocarbons. And next, in a press release from Bloom Energy, Idaho National Lab and Bloom Energy produce hydrogen at record setting efficiencies. And so in a press release on August 9, Bloom Energy Corp announced the initial results of its ongoing demonstration with Idaho National Laboratory, the nation's premier center for nuclear energy research and development. With nearly 500 hours of full load operation completed at the laboratory blooms high temperature electrolyzer is producing hydrogen more efficiently than any commercially available electrolyzers including PEM and alkaline.
Researchers that I NL have been conducting a variety of tests on Bloom Energy Solid oxide electrolyzer at the dynamic energy testing and integration laboratory, including steam and load simulations that replicate nuclear power station conditions, an important step in validating full compatibility with a nuclear facility. running at high temperatures and high availability. The pilot results reveal that bloom electrolyzer is producing hydrogen at 37.7 kilowatts per kilogram of hydrogen with an 88.5% LHV or lower heating value to DC. dynamic testing has also been conducted and included ramping up the system from 100% of rated power to 5% in less than 10 minutes without adverse system impacts.
In a quote from John Wagner, the director of Idaho National Labs, the Bloom electrolyzer is without a doubt, the most efficient electrolyzer we have tested to date at INL. When hydrogen is produced from a clean 24/7 source like nuclear, it can help us address some of the significant challenges we face around decarbonisation. Pairing the research and development capabilities of a national laboratory with innovative and forthing organizations, like Bloom Energy is how we make rapidly reducing the cost of clean hydrogen, a reality and a real step toward changing the world's energy future. operating continuously and providing high quality steam input. Nuclear plants are well positioned to utilize electrolyzers to efficiently produce substantial quantities of clean hydrogen, with minimal disruption to ongoing operations. Global demand for hydrogen and its emerging applications are projected to increase 10 fold or more by 2050, surpassing the current infrastructure for producing and delivering hydrogen. Now as hydrogen usage expands from traditional industrial uses, to the fuel of a clean future, the need to produce it in larger quantities, and from low and zero carbon sources is clear. Yet one of the primary barriers to scalable and abundant hydrogen is production cost, which can be up to 80% of the cost of hydrogen production through electrolysis being electricity. Because bloom electrolyzer operates at high temperatures, it requires less energy than low temperature PEM and alkaline electrolyzers to split water molecules producing hydrogen up to 45% more efficiently than PEM and alkaline electrolyzers. When combined with external heat, the bloom electrolyzer supports a trajectory for hydrogen to become economically accessible.
In a quote from KR Sridhar, founder and chairman of CEO of Bloom Energy, we are proud to have partnered with the Idaho National Laboratory on this landmark demonstration. By combining our blue electrolyzer with steam, the laboratory has been able to validate that the DC electrical efficiency for our electrolyzer is better than any reported commercial or demonstration unit in the world for hydrogen production. This is an important milestone as we work to build a hydrogen economy. Now the successful collaboration is an important step toward the goal of replacing hydrocarbon derived fuels with clean hydrogen and commercial and industrial applications. They're responsible for more than 1/3 of the world's consumption and a quarter of global co2 emissions. industrial companies are particularly well suited for low cost, large scale hydrogen utilization, given their substantial energy requirements and growing commitments to produce low emissions, commodities and fuels. Okay, so really a big congratulations to Bloom Energy on the successful trial of their new electrolyzer.
Now, I've been rather vocal on my position that I think that makes more sense to use nuclear derived energy to produce hydrogen via electrolysis, since the electricity coming from a nuclear reactor is much more stable and reliable than that coming off of renewable electricity. Now, I've heard nuclear derived hydrogen being colored as either pink or yellow. But regardless of the color you associate with this technology, it does have its own drawbacks. And that is that nuclear also has its own stigma associated with it. And there aren't a lot of nuclear reactors globally that can take advantage of this technology, making it difficult to scale and potentially uneconomic but for right now, I think it's important to focus on the fact that this was a solid test, showing great promise with this technology.
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