A new discovery makes green hydrogen much cheaper

Scientists from the Australian agency CSIRO (a type of TNO) have created a technology that can produce hydrogen 30 percent more efficiently. They use residual heat from industry and use the materials in the electrolyzer (a machine in which hydrogen is separated from oxygen) in a smart way.

Green hydrogen plays a key role in the transition to a climate-neutral energy system, but it is currently a much more expensive energy source than oil or natural gas. Hydrogen is particularly important in making industry, the chemical sector, and heavy transportation more sustainable. It cannot be operated with (green) electricity.

Hydrogen will also be needed to generate electricity in times when wind turbines and solar panels provide very little power. After that, conventional power plants will enter, but in the future they will not operate on natural gas, but rather on hydrogen.

No expensive pipelines

It’s a long way from that. Hydrogen cannot be extracted from a mine or field. It is not a source of energy but a carrier of energy. Hydrogen must be produced. Hydrogen has been extracted from natural gas in industry and chemistry for decades. Here comes the CO₂^{When it is free, this is why it is referred to as “gray” hydrogen. Sustainable or “green” hydrogen is produced with electricity from wind farms and solar fields.}

The technology developed by CSIRO uses industrial residual heat. As a result, hydrogen production requires 30% less electricity, meaning green hydrogen production costs are much lower. CSIRO will build a pilot plant at a steel mill in the New South Wales province. If steel mills produce hydrogen locally, they can reduce the use of fossil fuels. Moreover, there is no need for expensive pipelines to transport hydrogen from elsewhere.

Innovations like those in Australia are important. Energy-saving methods make production cheaper. “You’re seeing innovations emerging all over the world in hydrogen technology,” says Noe van Hulst, an energy expert and hydrogen advisor to the International Energy Agency (IEA).

Tata Steel, Shell and BP are waiting

The International Energy Agency recently noted that despite all the innovations, the pace of building electrolyzers is decreasing around the world. By 2022, hydrogen plants with a capacity of 130 MW will be built. This sounds like a lot, but it’s not. The Hollandse Kust Zuid wind farm in Vattenfall alone has a capacity of 1,500 MW. About 45 percent fewer electrolyzers were manufactured in 2022 than in 2021, while experts expected continued and rapid growth.

how is that possible? According to energy expert Van Holst, there is “some hesitation” among companies to invest in hydrogen plants, because there is still a lot of uncertainty surrounding hydrogen. How quickly will supply and demand take off? What support programs exist? When will the pipelines be ready to transport hydrogen? What will the legislation and regulations be?

A company like Tata Steel will not change its production process from coal to hydrogen as long as it is not sure of its ability to obtain green hydrogen. Companies like Shell and BP will not build large hydrogen plants as long as they are not sure that the industry will actually buy this sustainable fuel. “Removing those doubts takes longer than expected,” van Hulst concludes.

However, many experts are convinced that the world is about to accelerate. “Compare it to wind and solar 15 years ago,” van Hulst says. “At the time, a lot of people said it was expensive and would always be small. However, we have seen a huge expansion and reduction in the cost of sustainable energy sources.

Electrolysis will also have to be produced on an “industrial scale” in the next 10 years. The capacity of the factories will no longer be expressed in megawatts, but rather in gigawatts. “When we reach this stage, costs will fall sharply,” Van Hulst predicts. But this also requires stimulating innovations like those in Australia. “These types of developments never go in a straight line. It will be a bumpy ride, and we have to get through it with consistent policies. This is essential to becoming climate neutral.”

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