November 01, 2021 • Paul Rodden • Season: 2021 • Episode: 60
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In episode 060, Russia's green energy transition will cost $1.2 trillion dollars. Lhyfe and Plug Power to create a European Green hydrogen partnership. And could high gas prices make the world take another look at yellow hydrogen? All of this on today's hydrogen podcast.
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Russia's green energy transition will cost $1.2 trillion dollars. Lhyfe and Plug Power to create a European Green hydrogen partnership. And could high gas prices make the world take another look at yellow hydrogen? 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 the Moscow Times, Russia's green energy transition will cost $1.2 trillion according to a Kremlin economic aid. Russia's transition to renewable energy could cost its economy roughly $1.2 trillion by 2050 this according to a top Kremlin economic aid, told the Commerce on Business Daily ahead of the landmark Cop 26 Climate Summit. The 90 trillion ruble price tag comes from a draft Energy Transition Plan recently presented by the Economic Development Ministry, according to First Deputy Prime Minister Andrei Belousov, as he told the Commerce on last Monday, our entire so called intensive scenario in the energy transition strategy cost about 90 trillion rubles over 28 years. That means 3.2 trillion a year.
This comes out to less than 3% of GDP. According to the plan, Russia would need to invest about $45 billion per year into renewables, nuclear and hydrogen energy in order to meet its goal of cutting greenhouse gas emissions by 79% by 2050. Russia is the fourth largest emitter of greenhouse gases has historically relied on its vast oil and gas reserves to bolster its economy. The country's leadership this year has started paying closer attention to climate change, passing the first greenhouse gas monitoring legislation in Russia's history, calling for methane emission cuts and acknowledging the global climate emergency. President Vladimir Putin this month pledged that Russia would achieve net zero carbon emissions by 2060. Nuclear power will play an important role in the country's energy transition. Belousov said arguing that quote, a whole range of countries don't want to acknowledge nuclear generation as clean, but they don't want to create strategic competition.
The IEA experts recently called for an urgent and complete halt on all new investment into coal, oil and natural gas exploration. But because Russia plans to rely on natural gas as a transitional fuel, the country will need to expand as gas infrastructure Belousov said adding at the infrastructure could later be used to ship hydrogen fuel. For example, a new Nord Stream two pipeline could be adapted for hydrogen transit, he said, Belousov's comments come on the eve of the UN COP 26 Climate Summit in Glasgow, which is billed as one of the last chances remaining for the world leaders to commit to drastic emissions cuts needed to help keep global warming below catastrophic levels. Russia is one of the few leading economies not to have submitted a more ambitious climate strategy ahead of the November Summit, as is required. So interesting news coming out of Russia. And there are a few key points to pick up in this article.
First is the impact of the cost, and that they estimate that this transition is less than 3% of their GDP. And I believe that's due in large part to their heavier reliance on natural gas as a transitional fuel. Also of importance, was the note about the Nord Stream two pipeline and its adaptation for hydrogen. And now that that pipeline has resumed construction. Once it's completed, Russia could be the primary source of natural gas and hydrogen for Europe. Next and an article from renewablesnow.com, Lhyfe and Plug Power to create a European Green hydrogen partnership. French green hydrogen producer Lhyfe and US based fuel cells and electrolyzer maker Plug Power have joined forces to realize opportunities throughout Europe. Together Lhyfe and plug power are targeting a total hydrogen capacity of 300 megawatts by 2025.
Through this new alliance, with plans to also initiate the development of a one gigawatt production site. The two companies announced today that they have signed a memorandum of understanding that outlines the respective roles and objectives in this partnership. The new initiative will primarily serve on road and off road mobility applications. According to Matthieu Guesne, CEO and founder of Lhyfe thanks to this partnership, we will be able to rely on plug powers cutting edge technology to deploy numerous hydrogen production sites onshore and offshore in Europe, but also in North America, which is particularly important decarbonisation needs, in particular to replace the hydrocarbon products that are still extracted and consumed on a massive scale.
The two companies are already working together on a project in France as a part of it, plug power will supply a one megawatt electrolyzer for use and what the partners say will be the world's first offshore hydrogen production facility. It will be powered by electricity from a floating wind turbine off the coast of Le Croisic, on the SEM-REV offshore test site. Lhyfe expects this facility to become operational next year. In the meantime, the pair will consider co developing a similar offshore wind electrolyzer plant in the US as well. Plug Power says it has been present in Europe for over 10 years now, during which time it has installed a number of PEM technology solutions in Germany, France, the Netherlands, Italy and Portugal.
Recently, it opened its European headquarters in North Rhine-Westphalia, Germany. So another interesting partnership between a fuel cell manufacturer and a hydrogen manufacturer. As I've mentioned before, I really expect a lot more of these partnerships to take hold. And it's through partnerships like these, that hydrogen hubs can be formed. And with the development of these hubs, the hydrogen industry won't have to worry as much about infrastructure. And lastly, an article from World Nuclear news.org. high gas prices shift optimal hydrogen production to nuclear according to the IAEA, using its new framework for the modeling of energy systems.
The IAEA found that gas price increases the optimal mix of technologies for producing low carbon hydrogen shifts in favor of nuclear and renewable energy and away from natural gas, with or without carbon capture and storage. Now while the study focused on particular country, its results can be generally applied to other energy markets. As a baseline reference for average natural gas price. The FRAMES study used $6 per million BTU's, which was the approximate price in markets such as Europe as recently as last spring before the recent price surge, that was also the price use in a recent your Inca era study and the UK market in the year 2050, which showed the nuclear energy partnered with renewables can lower the overall system's cost of hydrogen production.
According to Francesco Ganda, an IAEA nuclear engineer who conducted the study, this shift happens at natural gas costs that are substantially lower around the US dollar 10 to 15 per million BTU than those observed in recent days in the European Union, UK and parts of Asia. This he said referring to a recent record high spot price, in these markets between $35 and $40 per million BTU. A globally used measure for the energy content of natural gas. Natural gas prices rise above $20 per million BTU the FRAMES study showed that the optimal method of hydrogen production becomes a mix of electrolysis produced hydrogen from electricity supplied by a combination of renewables and conventional nuclear power plants and thermal processes that can be eventually supplied by advanced high temperature reactors.
Now FRAMES which is still under development is currently being used for internal IAEA analysis of integrated energy systems. It provides quantitative analysis on nuclear powers potential benefits to present and future electricity systems, which is a particular interest for countries pursuing or considering nuclear power as part of their solution to meet net zero goals. The model evaluates short and long term impacts on overall carbon emissions structure of the generation mix and cost of electricity provision, which helps to inform the economic impacts of achieving various co2 emission targets. Additionally, FRAMES can support technical analysis involving the optimal grid integration of advanced nuclear technologies, such as small modular reactors, micro reactors and fast reactors, as well as non electric applications of nuclear energy.
The FRAMES study comes ahead of the COP 26 Climate Change Conference, where the IAEA will hold several events to underscore nuclear energy's contribution to achieving the goals of the Paris Agreement and agenda 2030 for sustainable development. It said clean hydrogen is increasingly seen as having a key role in the clean energy transition as part of a reliable low energy mix. So an interesting article out of World Nuclear news. And first and foremost, I would take with a grain of salt, that all of this information is being generated by the nuclear industry. That being said, it's not fully worth discounting it. As it is important to remember, the blue hydrogens feedstock is a variable cost that can and does increase.
I've also always been very interested in yellow hydrogen. And I believe that the early application of electrolysis using nuclear power makes a lot more sense than renewable generated hydrogen. But it's also important to remember that there are other companies out there, making small modular hydrogen generating heat units that can make hydrogen not only from natural gas, but also renewable natural gas and solid waste. The key factor in that last one, being a free feedstock.
Alright, that's it for me, everyone. If you have any questions, comments or concerns about today's episode, come visit me at my website at thehydrogenpodcast.com and let me know. I would really love to hear from you. And as always, take care. Stay safe. I'll talk to you later.
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.