H2Tech - Q2 2021 - 39

BLUE HYDROGEN PRODUCTION

Increasing blue hydrogen
production affordability
N. LIU, Shell Catalysts & Technologies, The Hague, the Netherlands

Large-scale, affordable, " blue " hydrogen production from natural gas, along
with carbon capture, utilization and storage (CCUS), is necessary to bridge the
gap until large-scale H2 production using
renewable energy becomes economic.
The cost of carbon dioxide (CO2 ) already
makes blue H2 via steam methane reforming (SMR) competitive against gray H2
(without CCUS), and a newly available
processa based on gas partial oxidation
(POX) technology and pre-combustion
CO2 capture solvent technology further
increases the affordability of blue H2 for
greenfield projects.
Why blue H2? A growing number of

national governments and energy companies, including Shell,1 have announced
net-zero-emission ambitions. Although
renewable electricity is expanding rapidly,
without low-carbon H2 as a clean-burning, long-term-storable, energy-dense
fuel, a net-zero goal is difficult to achieve,
especially when it comes to decarbonizing
fertilizer production and hard-to-abate
heavy industries such as steel manufacturing and power generation. H2 also has potential as a transport and heating fuel that
could repurpose existing gas distribution
infrastructure or be introduced into existing natural gas supplies.
Consequently, H2 plays an important
part in many green strategies. The EU's
H2 strategy,2 published in July 2020, describes it as " ...essential to support the
EU's commitment to reach carbon neutrality by 2050 and for the global effort
to implement the Paris Agreement while
working towards zero pollution. "
Momentum is building with a succession of commitments to H2 by various
companies and governments. For example,
in June 2020, Germany announced a €9-B
H2 strategy,3 and the International Energy

Agency stated, " Now is the time to scale
up technologies and bring down costs to
allow hydrogen to become widely used. " 4
Over the past 3 yr, the number of companies with membership in the international
Hydrogen Council-which predicts a tenfold increase in H2 demand by 20505-has
jumped from 13 to 81 and includes oil and
gas companies, automobile manufacturers, trading companies and banks.
In 2018, global H2 production was 70
MMtpy.4 Today's demand is split between
use for upgrading refined hydrocarbon
products and as a feedstock for ammonia
production for nitrogen fertilizers. Nearly
all H2 production comes from fossil fuels: it accounts for 6% of natural gas and
2% of coal consumption, as well as 830
MMtpy of CO2 emissions6-more than
double the UK's emissions.7 Gray H2 is a
major source of CO2 emissions. If H2 is to
contribute to carbon neutrality, it must be
produced on a much larger scale and with
far lower emissions levels.
Over the long term, the answer is
likely to be " green " H2 , which is produced
from the electrolysis of water powered
by renewable energy. This supports the
integration of renewable electricity generation by decoupling production from
use. H2 becomes a convertible currency
enabling electrical energy to be stored and
used as an emissions-free fuel and chemical feedstock.
Green H2 projects are starting. For
example, a Shell-led consortium is at the
feasibility stage of the NortH2 wind-to-H2
project in the North Sea, and a Shell-Eneco
consortium secured the right to build the
759-MW Hollandse Kust Noord project
at a subsidy-free Dutch offshore wind auction in July 2020; this project will include a
green H2 technology demonstration.
However, electrolysis alone will not
meet the forecast demand. It is expensive

at present, and there is insufficient renewable energy available to support largescale green H2 production. To put the
scale of the task into perspective, meeting
today's H2 demand through electrolysis
would require 3,600 TWh of electricity,
more than the EU's annual use.4 Moreover, using the current EU electricity mix
would produce gray H2 from electrolysis
with 2.2 times the greenhouse gas emissions of producing gray H2 from natural
gas.8 This is because nearly half (45.5%)
of the net electricity generated in the EU
comes from burning natural gas, coal and
oil,9 and generating electricity from natural gas, for example, has a 44% efficiency.10
An alternative is blue H2 produced
from natural gas, coupled with CCUS. H2
production via electrolysis has a similar
efficiency to blue H2 production, but the
levelized cost of production is significantly
higher for electrolysis at €66/MWh, compared with €47/MWh for SMR-CCUS.11
In addition, it is widely acknowledged
that scaling up blue H2 production will be
easier than delivering green H2 . For example, the EU strategy 2 states, " Other forms of
low-carbon hydrogen [i.e., blue] are needed, primarily to rapidly reduce emissions
... and support the parallel and future uptake of renewable [green] hydrogen. "
However, the strategy goes on to claim
that neither green nor blue H2 production is
cost-competitive against gray; the H2 costs
estimated for the EU are €1.5/kg for gray,
€2/kg for blue and up to €5.5/kg for green.4
These costs are based on an assumed natural gas price for the EU of €22/MWh, an
electricity price of €35/MWh-€87/MWh
and a capacity cost of €600/kW.
With the cost of CO2 at $25/t-$35/t,
blue H2 becomes competitive against gray
even with higher capital costs, and green
H2 still may be more than double the price
of blue H2 by 2030 (FIG. 1).4 Some foreH2Tech | Q2 2021

H2Tech - Q2 2021

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