December 15, 2022 • Paul Rodden • Season: 2022 • Episode: 172
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In episode 172, A huge press release comes out from s&p global and GTi. I'll go over the press release and give my thoughts on today's hydrogen podcast.
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A huge press release comes out from s&p global and GTi. I'll go over the press release and give my thoughts 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 a massive announcement coming out this week, December 13. Global Energy leaders join open hydrogen initiative to unlock hydrogens full potential. S&P global commodity insights and GTi energy announced on December 13, a cohort of new stakeholders to their open hydrogen Initiative, a recently announced collaboration to further transparency into environmental impact of hydrogen production, and help unlock its full potential as a full alternative and important driver of energy transition. The mission is to create an industry led objective, credible and harmonized methodology and toolkit for measuring the carbon intensity of hydrogen production at the facility level to lay the foundation for a low carbon hydrogen marketplace. In a quote from Paula Gant, a PhD and President and CEO of GTI energy. The new open hydrogen initiative participants announced today December 13, will provide crucial marketplace insight to vet the technological protocols and methodologies. The initiative will ultimately develop for industry, policymakers and investors.
She continues to say each founder and stakeholder brings various levels of technical support, r&d perspective, and real world marketplace insights to close the methodology gap that undermines the commoditization of hydrogen. Initial OHI industry stakeholders now include EQT, National Grid, Shell, ExxonMobil, Dominion Energy, LanzaTech, Equinor, BlackHills Corporation, Nicor Gas, NYSEG, Oklahoma Natural Gas, Duke Energy, DTE, and Southwest Gas Corporation. Nonprofit, academic, and observer partners include Clean Air Task Force, The University of Newcastle Australia, Queen Mary University of London, Columbia University, Stanford University's Hydrogen Initiative, Breakthrough Energy, Bipartisan Policy Center, Center for Houston's Future, Government of Alberta, Clean Hydrogen Future Coalition, Renewable Hydrogen Alliance, Operations Technology Development (OTD), Evergreen Climate Innovations, and Hydrogen Forward. Development of the OHI measurement toolkit is already underway and ongoing, with a launch of demonstration projects targeted within the next 16 months. Initial stakeholder work is centered on the characterization of hydrogen production processes to understand energy and material flows and major emissions hotspots.
The open hydrogen initiative is focused on identifying real world applicability and credible carbon intensity values for a range of production methods, all critical to ensure a sustainable growth trajectory of hydrogen in the marketplace. Government programs to support the growth of low carbon hydrogen market are being implemented around the world. In a quote from Alan Hayes head of energy transition pricing and market data at s&p global commodity insights. The inflation Reduction Act in the US is just one example of regulators and market participants, putting lifecycle carbon emissions at the center of strategies to support the growth of the hydrogen market, peer reviewed and transparent open source measurement tools and methodologies are necessary to determine the carbon footprint of hydrogen entering the markets. The European Union's creation of hydrogen Bank, which will invest 3 billion euros and low carbon hydrogen projects is another example of measures aimed at supporting the scaling of low carbon hydrogen markets. Subsequent to cop 27 intergovernmental discussions, it is clear that hydrogen remains one of the key routes available to advanced projects worldwide that can contribute to decarbonisation.
OHI develop tools will be critical to move beyond the current color spectrum labeling method of carbon intensity measuring which only represents the method by which energy is produced. Two molecules of quote blue hydrogen or hydrogen produced by natural gas with carbon capture can have highly variable carbon footprints depending on the facilities in which they were produced. OHI founders believe an equitable comparison of carbon intensity at the facility level of hydrogen production could be a game changer, allowing for more precise granular measurements such as kilograms of carbon dioxide produced per kilogram of hydrogen.
According to s&p global commodity insights hydrogen outlook, global hydrogen demand grows from 70 point 4 million tonnes in 2020 to 97 million tonnes in 2030 and 249 million tonnes in 2050. Hydrogen demand is currently concentrated in oil refining and ammonia production, but nearly 90% of demand growth through 2050 comes from new sectors like heavy duty transportation, steel production, and long term energy storage. decarbonizing hydrogen supply is critical to initiate uptake in these new sectors. And an industry standard emissions Measurement and Verification process is key to providing the market transparency that facilitates new supply agreements. Okay, so an amazing press release. It's felt like for several months now that the hydrogen market has been at a precipice just waiting for that big announcement that really and finally showcases that hydrogen time has arrived. And this announcement really feels like that time has come.
Now, I know that there will be naysayers to this, saying this is to oil and gas heavy for participation. But I believe that most if not all naysayers to this are going to be shocked when they finally see the full carbon intensity of new hydrogen development platforms that rely on natural gas for their feedstock. And keep in mind, everything coming out of this initiative is going to be peer reviewed. And I will bet anything that whoever's reviewing this stuff is going to be independent. And what this press release, also enforces is what I've been saying since the beginning. And that is that it doesn't matter. The technology, or the colors, when it comes to hydrogen is all about the carbon intensity level of how it's produced. The next question on your mind may be then what does this mean for electrolytic hydrogen, because really, with electrolytic hydrogen, where it's made or at the facility is going to be carbon negative or carbon neutral. And so then full carbon lifecycle analysis has to be implemented.
And that will include the mining for the ores for the electrolyzers, as well as the materials development, and transportation of the renewable generating devices themselves, ie windmills and solar panels. That's not to say that electrolytic hydrogen doesn't have its advantages. An easy example of this will be areas and countries that don't have hydrocarbon assets, that want to start developing hydrogen. A lot of these areas still have great natural resources that they can use to generate the electricity needed to create electrolytic hydrogen. A great example of this would be the country of Ireland, which has a huge upside in offshore wind. Now, there is one important thing of note in this announcement. And that is that the launch of the demonstration projects are going to be targeted within the next 16 months. And that should put it right around the middle of 2024. And so if I were a betting man, I would say that the first part of 2024 is going to see a lot of new projects getting announced with the second half of that year showing those projects actually starting to break ground. And so because of all of this, I don't know about you, but this announcement makes me very excited.
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Hey, this is Paul. I hope you liked this podcast. If you did and want to hear more. I'd appreciate it if you would either subscribe to this channel on YouTube, or connect with your favorite platform through my website at www.thehydrogenpodcast.com. Thanks for listening. I very much appreciate it. Have a great day.