Decarbonisation of industry

Many of these sectors – such as steel, chemicals and glass – use hydrogen in their processes. Currently almost all of this is ‘grey’ hydrogen, made with fossil fuels. 

Switching to low-carbon or ‘green’ hydrogen – which at the moment is mostly made by using electricity from renewable sources to split water into hydrogen and oxygen – could thus be an important step forward.

Governments around the world are starting to create national hydrogen strategies, adding low-carbon hydrogen into their energy mix and encouraging the private sector to prioritise investment in green hydrogen production.

Writing the hydrogen rulebook

For the average industrial user, the transportation of hydrogen has not been much of an issue to date. It is mostly produced on site. This will change if industries switch to using greener hydrogen that originates elsewhere. 

In most countries, hydrogen production, transport, storage and use are largely regulated under existing gas and health & safety regulations. Korea, Japan and Germany are amongst the exceptions, having enacted hydrogen-specific legislation. 

Given the urgency of decarbonisation, other nations are starting to review their regulatory regimes for hydrogen. The UK government recently began consulting on its proposed regulation of hydrogen transport and storage infrastructure – see Regulating hydrogen transport and storage. (The consultation closes on 22 November 2022.) Similarly, the Netherlands is developing a dedicated national legislative regime.

In each case, how the local regulatory regime enables the industrial sector to secure its hydrogen demand will be a factor in determining how much low-carbon hydrogen is an option for decarbonising industrial operations.

Certification

We generally refer to hydrogen as grey or green – or blue (produced from natural gas, using carbon capture and storage), or pink (made with nuclear-powered electrolysis), or various other colours.

In reality, of course, all these different ‘types’ are chemically indistinguishable.

But from an environmental perspective, purchasers of green hydrogen need to feel confident that it is truly low-carbon. This is also true from a commercial perspective, as green hydrogen commands a price premium.

A number of legislative definitions are emerging to address this need. The EU, through its revision to the RED II Directive, seeks to define low-carbon hydrogen as:  

• hydrogen deriving its energy content from renewable sources, excluding biomass; and
• hydrogen that achieves a 70% reduction in GHG emissions compared to production via fossil fuels.

The UK’s Low Carbon Hydrogen Standard requires producers to meet a GHG emissions intensity of 20g CO2e/MJLHV or less. In the United States, the new Inflation Reduction Act defines clean hydrogen as hydrogen that is “produced through a process that results in a lifecycle greenhouse gas emissions rate not greater than four kilograms of CO2e per kilogram of hydrogen.”

The need to prove that hydrogen meets such standards will make robust and internationally recognised certification regimes important. Initiatives such as the EU’s CertifHy, TÜV SÜD in Germany, and the Australian Zero Carbon Certification Scheme are examples of developments in this area.

At present, these schemes are jurisdiction-specific and geographically disparate. In due course, the expectation is that there will be a secondary marketplace in certificates, similar to that which exists for renewable electricity. Harmonising certification regimes to facilitate more comprehensive import/export markets will also help realise the potential of green hydrogen as an industrial fuel. 

Infrastructure 

Aside from the current cost of producing green hydrogen, on a practical level the mass adoption of green hydrogen by these sectors is contingent on developments in electrolyser technology and the roll-out of infrastructure.

Projects may begin by utilising on-site production – limiting the initial need for transport and storage logistics – but in due course hydrogen will have to be transported by pipeline and road. Initiatives such as the European Hydrogen Backbone will be critical.

A flexible fuel

Low-carbon hydrogen has many potential applications beyond hard-to-decarbonise heavy industries. 

As well as being a possible replacement for natural gas in heating systems, it has scope to be used as a fuel – or to create fuel – in the aviation, shipping and road haulage sectors.

It may even be piped directly to hydrogen power plants for on-demand electricity generation, providing grid flexibility and helping to manage intermittency in renewable electricity generation. 

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