wind.letters
- Oct 5, 2021
- 6 min read

The Hidden Potential of Green Hydrogen and Can It Temper the Fluctuating Natural Gas Market?

Updated: Oct 8, 2021

Green or renewable hydrogen is gaining momentum as an electricity storage solution to overcome grid frequency fluctuations that are inherent to renewable energy. Most currently though, green hydrogen gas has even been suggested as a replacement for natural gas, or at least as an addition to the current gas mix to easy shortages.

Green hydrogen qualifies for a green (fossil fuel-free) label when produced from any kind of renewable electricity, mainly photovoltaic and offshore wind farms. The renewable electricity is converted into hydrogen gas via electrolysis and the gas can be stored until demand is high to be turned back into electricity and inserted into the grid. Green hydrogen gas can also be directly utilized in numerous industries, like cement and steel production, the chemical industry, aviation, trains, or cars.

Source: HYBLEND, NREL

Developers, like NortH2 in the Netherlands, dream even bigger: If every large renewable energy facility gets paired with a hydrogen plant, the majority of the electricity from the facility can be turned into green hydrogen gas and inserted into the existing gas pipeline network. According to NS Energy, a platform that reports on all energy markets, transmission through the gas network is more cost effective than electricity transmitted through cables besides the advantage of a much higher capacity within the U.S. gas pipeline network.

Renewable developers have been confronted with long delays in the transmission permitting process for renewable energy, holding back project approvals specifically in the Northeastern states. The existing transmission grid was built from inland to population centers on the coast, delivering high electrical loads from coal or nuclear power plants to load centers. But with offshore wind out in the ocean, the electricity flow is reversed which creates other difficulties on top of the urgently needed upgrade of the existing grid for a higher input of renewable power. Using the gas grid can overcome these obstacles and speed up the process of the renewable energy expansion.

What will help is an extensive network of approximately 3 million miles of natural gas pipelines and over 1,600 miles of dedicated hydrogen pipeline, according to the U.S. Department of Energy. In a report from 2013 by NREL, the U.S. gas network’s potential for green hydrogen had been deemed feasible but it still needs “intensive studies, testing, and modifications to existing pipeline monitoring and maintenance practices.” The authors concluded if green hydrogen is “implemented with relatively low concentrations, less than 5%–15% hydrogen by volume, this strategy of storing and delivering renewable energy to markets appears to be viable without significantly increasing risks associated with utilization of the gas blend in end-use devices … or the durability and integrity of the existing natural gas pipeline network.” To research the impact on gas lines and other technical issues, six U.S. national labs announced the initiative HyBlend in December 2020 and received $15 million in funding for the next two years to “characterize the opportunities, costs, and risks of blending” green hydrogen into the natural gas lines.

Abroad, in Sweden, two green hydrogen-to-industry projects are in a pilot phase and showing promising results in connection with iron and steel production. HYBRIT and H2 Green Steel are both using green hydrogen in a steel mill with the goal of completing a 100% fossil fuel-free production chain. Last June, the first shipment of hydrogen-reduced sponge iron (90 percent emission reduction) was delivered to truck manufacturer Volvo.

When green hydrogen is evaluated as a replacement for natural gas in the future, or at least to break the world’s dependence on gas monopolies, it becomes clear that in order to avoid a fallback on fossil fuels the technology needs to be advanced quickly. In Europe, to overcome the current gas crisis green hydrogen does not play a role yet. Instead, the two immediate strategies point to either increasing the capacity of coal power plants (which had been scheduled to be phased out) or speeding up the certification of Nord Stream 2, a natural gas pipeline that connects Russia with the E.U. via two connection points on the German coast.

Nord Stream 2, a Gazprom subsidiary, will allow Russia’s state owned gas company Gazprom to heavily expand its market share in Europe – an issue of great controversy. Both the neighboring countries of Poland and the Ukraine as well as the E.U. councils claim that Nord Stream 2 would counter the long-term policy to diversify the gas market. The German government has been strongly opposing these claims, and celebrated project milestones. Not so much the opposition parties, like the Greens (ecology oriented) and Free Democrats (business oriented) who say the pipeline dependence on Russia does fit in with climate and foreign policy goals.

Since the very beginning, the U.S. has been heavily weighing in on the Nord Stream 2 pipeline as well, claiming it was not in the E.U.’s interest and would give Russia too much influence on the E.U. gas market. In 2017, the U.S. under President Trump started to threaten companies that have been working on the pipeline with sanctions, which was manifested in the January 2021 U.S. Defense Bill. The U.S. Congress shares a bipartisan opposition against Nord Stream 2, so even after President Biden came into office, the view on the project has not changed much. Biden realized that Germany won’t budge, and with 90 percent of the pipeline now completed, he agreed on a compromise with outgoing German Chancellor Merkel for the sake of good relationships with Germany.

Nord Stream 2’s pipeline completion was announced by Russia’s President Putin on September 10, 2021 and is now awaiting certification to operate by Germany’s energy regulator, which can take up to four months. While Nord Stream 2 is also criticized by the Ukraine and Poland for controlling the pipeline and not allowing third-party usage, the company is trying to disperse other points of criticism on its project website. Among them are cunning arguments such as the pipeline is not subject to E.U. energy market regulations because the pipes are laid in the Baltic Sea, which per Nord Stream 2 is not within the internal market (it connects to Germany, a E.U. member state). The claim that the pipeline increases Europe’s dependency on Russia is countered by stating, “European gas companies will buy gas where they find the best deal.”

Consumers in Spain already experience rate increases due to limited competition. By the third quarter of 2021, gas prices have tripled since the beginning of this year, and are five times higher compared to 2019. Due to mismanagement over the summer, when utilities usually fill up their storage for the winter season, the utility companies are now anxiously waiting for gas from Russia. Whether Russian gas will help counter the spike in rates is yet to be seen.

This week, the European Renewable Hydrogen Coalition, an industry association, is urging European decision makers to create a framework for a radical scale-up and use of green hydrogen. After intensive research and development, “we are proud that Europe is home to the world’s leading electrolysis suppliers today”, said Nils Aldag CEO from Sunfire and one of the co-chairs of the coalition in a press release. “Now we must prove that we are not only strong in product development but that we can also rapidly accelerate the commercialization of our technologies."

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Electrolyzer Technology:

https://www.iberdrola.com/sustainability/electrolyzer

Associations and Initiatives:

Renewable Hydrogen Coalition, Europe

European Union Target Package Fit-For-55, to cut E.U. carbon emissions by 55 percent by 2030, and become carbon neutral by 2050. The E.U. committed to 40 GW of hydrogen electrolysis capacity by 2030.

Conferences:

Renewable Hydrogen Summit 2021 (Europe) hosted by Reuters

Upcoming:

Hydrogen North America (11/20-12/1/2021) hosted by Reuters

Hydrogen Economy Europe (12/2-12/3/2021) hosted by Reuters

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Read more:

Research & Studies

U.S.

Pipeline Transportation of Hydrogen: Regulation, Research, and Policy (Congressional research Service), March 2021

Articles

Sweden: