Hydrogen is not something new. It is being used for more than a century. It is Green Hydrogen (GH) that is new. Hydrogen is an energy resource, a clean one and the one which the global community is after for meeting fuel needs without adding to climatic concerns. Hydrogen is not only clean substitute for oil, gas and coal it is also a great storage medium. With increasing influx of intermittent renewable energy, there is and will be need for storage.
There is a competitive controversy between hydrogen-operated vehicles versus EVs (electric vehicles). Most probably, battery-operated EVs will succeed. In the case of hydrogen, one may have to replace batteries and add fuel-cell to the EV motors to convert EV to hydrogen, if need be. It depends on the availability issues of battery raw materials, which may ultimately decide the competition issue.
It is not the road-transportation sector only, where Hydrogen would be of use. The greatest use of hydrogen may come in electrical storage for the grid, as batteries’ requirement of rare and precious metals may be limited, limiting battery storage market.
Secondly, in case of high temperature industrial processes, electricity may not be able to compete—technically and economically. Hydrogen uses are almost everywhere where fossil fuels are used, and especially in the following where thermal or chemical uses are there: steel, cement, paper, food, chemical industry, fertilizer, oil refining and petrochemicals, metallurgy, food, glass and other extractive industries. Indeed a long list.
Hydrogen has a favorable impact on combustion characteristics of natural gas when mixed into the latter. Hydrogen can be stored in high temperature steel cylinders or cryogenic cylinders at normal pressures.
Existing natural gas pipelines may be repurposed for Hydrogen transport in a mixture form up to 40% without much changes in the pipeline parts including compressor, although there can be a 20% capacity loss. Thus, initially one could start transporting hydrogen in a 20% mixture with in natural gas pipelines. All new gas transmission projects in Pakistan such as North-South gas pipe line project should be designed with this factor in mind.
Hydrogen- natural gas mixture can be used as a mixture or hydrogen can be separated from the mixture. And there are other options of converting hydrogen to methanol or ammonia. For sea transport, ammonia containers may become more popular, eventually making international trade possible in hydrogen.
It may be noted that since water and sun may be available at most places, it will be producible at such locations and thus hydrogen may not require extended transmission and distribution system on the pattern of conventional natural gas pipelines.
There is a ‘Hydrogen 111’ programme; under which, the target is to produce 1 kg Hydrogen in 1 USD and in 1 decade. Currently, green hydrogen costs 4-5 Rs/kg, while black or grey hydrogen costs under 1 USD/kg. However, these are the numbers of pre-energy crisis period when fossil fuel prices were low. At present, the prices of LNG green hydrogen may be competitive. By 2030 or even slightly earlier, many jurisdictions will have competitive green hydrogen.
Some thirty countries have developed ‘hydrogen strategies’. While industrialized and developed countries are moving in the direction of hydrogen gradually including R&D and hydrogen production, even developing countries are moving in this direction as well.
Countries like Chile, Colombia, Costa Rica, Panama, Brazil, Morocco and a few other countries have started initial activities in hydrogen development intended to leading to commercial business.
Saudi Arabia plans to replace oil production gradually by hydrogen as oil market goes down gradually. The Saudis have cash. However, even Oman is moving towards developing hydrogen production. India has launched its ‘National Hydrogen Mission’ under which a target has been set to produce around 1 million tonnes of green hydrogen per year by 2030.
Starting late but China became largest and cheapest producer of both wind and solar power. The same thing appears to be happening in the case of hydrogen. China has become highly competitive in manufacturing hydrogen electrolyzers. BNEF, which earlier made projections for solar PV, has reported recently: “Chinese alkaline electrolysis systems generally cost 25% of the price of the same type of project in Western countries, thanks to cheap labor and upstream supply from the domestic market.” This was based on an industry survey of 20 companies.
It put the price of a Chinese alkaline electrolysis system at about$343/kW, compared with $1,200/kW in the West. Can we manage to attract CPEC (China Pakistan Economic Corridor) investment and technology to Pakistan’s engineering industry as has been mentioned earlier?
India did not have crude oil but it successfully established a large oil refining industry which not only made it self-sufficient in petroleum products but enabled it to export such products and earn foreign exchange. Pakistan missed the boat. Now there is ‘hydrogen opportunity’. India is also vying for export possibilities. Hydrogen is produced by electrolysis of water.
Electrolysis requires electricity which is produced by solar or wind and hybrid thereof; excess and unutilized electricity from wind and solar is also used. Electrolysis containers are mostly steel shells and parts made in mechanical engineering industry. We have a good engineering industry base both in public and private sector. Public sector engineering industrial plants are under-utilized where the steel made parts can be manufactured.
Except for Australia and the US, solar intensities and land availability are much less in developed world, including the EU region, Japan and South Korea. For this reason, the EU is supporting hydrogen development in Africa.
There were earlier similar initiatives in bringing solar generated electricity from Sahara to Europe. Significant soft investment activities and JVs (joint ventures) opportunities have been made available. Saudi Arabia, the UAE and Oman are also looking at export potential.
Pakistan should also look at building export capabilities. It takes time. Fortunately, that time window is there but not for inaction and wasting. We have sunshine and land area and a large coastal line for export infrastructure.
We have been digging all over for the unknown oil and gas for the last several decades without any significant find after Sui or Qadirpur. Let us go for the known and visible for which market and resource are there and coming up.
GH will have competitive uses in the country and abroad by 2030.Time goes by fast. Development of R&D and model facilities will enable us to go into hydrogen by 2030. If LNG continues to be unavailable and expensive, fertilizer sector may be the earliest candidate for conversion to green hydrogen.
Initially, a part of gas requirements may be procured from on-site green hydrogen production; and similarly in the oil refining sector where it may apply. Thar coal gasification may be the most competitive and ready route for fertilizer sector, however, climate politics may not permit it for a dependent country like Pakistan.
To conclude, GH is not a mere hype but a fast emerging reality with a potential to replace oil and gas and even open the doors for exports by those countries which have been hitherto energy importers. However, it is not a panacea. Nothing is a panacea, especially, in the energy sector. A right and affordable energy mix adds to energy security and affordability.
Copyright Business Recorder, 2022