Gas Industry Bets on Blue Hydrogen as a Transition Fuel for a Greener Europe
The gas industry on both sides of the Atlantic is moving to create markets and infrastructure in Europe in anticipation of promoting blue hydrogen, derived from natural gas, as a transition fuel to support EU goals of achieving net-zero emissions by 2050.
Hydrogen accounts for less than 2% of Europe’s current energy consumption, according to the European Commission on Energy. But as 2020 rolled into 2021, the industry has increasingly signaled that blue hydrogen produced from natural gas may, in particular, have its day as a transitional energy source.
In December, the world’s largest gas producer, Gazprom, announced at the Rosthoff Forum (Russia-Germany Natural Resources forum) that it had created the Gazprom Hydrogen Company.
Gazprom Hydrogen will implement innovative pilot projects with hydrogen and hydrogen-methane mixtures, including construction of a blue hydrogen plant at the German end of the Nord Stream pipeline. The plant would supply hydrogen to Europe and the carbon dioxide produced could be piped back to Russia for sequestration, according to a Forbes article.
Coincidentally, German media reported this week that one of the conditions set by the US in negotiations over possible lifting of sanctions on Nord Stream 2 was a requirement that Germany agree to help Ukraine expand its gas infrastructure for the export of hydrogen to Europe.
In addressing the Rosthoff Forum in December, Alexander Ishkov, Head of Gazprom’s Energy Efficiency and Environment Department, had said that Gazprom currently produces 360,000 tons of hydrogen annually at its facilities. To put that in perspective, it takes about 150 tons of liquid hydrogen to launch the space shuttle, Forbes reported.
Most likely hydrogen in Russia will be sourced from natural gas by fuel reforming—the so called blue hydrogen which, though cleaner than other energy sources, does produce carbon dioxide and methane.
The EU’s “Strategy for Hydrogen” published in July promotes the development of green hydrogen which is produced using renewable energy sources and does not emit greenhouse gases.
Green hydrogen though is more expensive; hence the push back by the gas industry to accept blue hydrogen as a transition fuel.
In an interview Thursday with Bloomberg, Shell’s CEO Ben van Beurden, characterized the hydrogen market as “minuscule at the moment” but nearing “an inflection point from where it will take off.”
“I believe the hydrogen business has similar characteristics to the LNG business,” van Beurden said. (His interview coincided with Shell’s announcement of a new business strategy to reach the EU’s 2050 emission goals.)
“We are the leading player in LNG and we want to replicate some of that journey for hydrogen, initially on a smaller scale, but eventually as a business that could rival our LNG business,” van Beurden said.
Hydrogen has a place in transportation, in the heavy trucking industry, public transportation, in shipping and in aviation.
Russia plans to begin converting electrical-powered public transit buses to hydrogen in 2023 with hydrogen-powered locomotives to follow, thus creating new domestic demand for Gazprom.
Currently, Moscow has more electric buses than in any other European capital; 600 as of yearend 2020, which is twice that of second place London. By 2023, when conversion to hydrogen would start, Moscow projects its electric bus fleet will have grown to 2,300, according to Insideevs.com.