I was listening to a short chat between Armin Schnettler, the SVP New Energy Business, Siemens Energy, and Kevin O’Donovan. Kevin, without doubt, is an outstanding, knowledgeable technology evangelist for all things relating to the Energy Transition.
The two briefly discussed green Hydrogen and where Electrolyzers will fit within the future strategy of building a broader Hydrogen business. You can watch the 4-minute chat here on YouTube.
The conversation triggered several questions that I decided to find out about, research, and learn and covered in two posts, this one and one specifically on Electroyzers over on my dedicated Energy Transition site of https://innovating4energy.com
I certainly believe we will see emerging a lot of new inventions and innovations to get the Electrolyzer based on PEM technology Industrial ready.
Hydrogen has become the “lightning rod” of transforming the clean energy needs. In the past two weeks, the Germany Government announced its new Hydrogen Policy, quickly followed by the European Unions Strategic Road Map for Hydrogen.
In summary, the goal of the Germany initiative is to generate demand of 90-110 TWh by 2030 with up to 5GW of Hydrogen produced through Electrolyzers of installed capacity, then to provide an additional 5GW by 2035.
The roadmap for Hydrogen announced by the European Union is looking to install at least 6GW of renewable hydrogen electrolyzers in the EU by 2024 and have in place 40GW of renewable hydrogen electrolyzers by 2030. To help with this, they have encouraged the formation of a European Clean Hydrogen Alliance to develop the investment schedule and pipeline of concrete projects
Both announcements will “kick-start” the building of industrial-scale hydrogen demonstration and production plants across the possible hydrogen value chain in all industrial sectors across Europe.
Not only will it galvanize product development in scaling up, but giving that essential policy clarity and financial backing will also see an energy European trading market for carbon-free hydrogen.
Expectations are certainly sky high, but you get a sense of the hard landing when you are looking at the current realities for green hydrogen.
Why Hydrogen?
Hydrogen has the best potential to be a substantial decarbonizing vector in many industries. It can address a wide variety of existing and new markets where electrolyzers can play a significant role.
- Firstly by exchanging fossil fuel hydrogen with renewable hydrogen for fertilizers and feedstocks
- Secondly, exchanging coal and gas with renewable hydrogen for steel making and chemical production.
- The Electrolysis method can bridge the gap between power and the industry sectors, increasing the value of electrons and provide the essential molecules.
- The Electrolyzer can complement the intermittent renewable energy sources of wind and solar to form a complete energy source. Hydrogen can be stored, and the electrolyzer ramped up when you suffer variable weather conditions to offer continued energy, all based on renewable sources, solving the seasonal variations that wind and solar can have.
Hydrogen does the potential to tick all the boxes of the decarbonizing industry as well as be the alternative heat source fo building and through hydrogen fuel cells offer low-carbon mobility. Using renewable hydrogen can accelerate the shift to green energy and decarbonization as a replacement for fossil fuels. Finally, it has the potential to be substituted in many of the harder-to-abate industrial sectors reliant on hydrogen through steam methane reforming as well as compliment electricity and decarbonize the gas grids we presently rely upon.
Hydrogen is not an energy source but an energy carrier. It is versatile; it offers no greenhouse gases, particulates, Sulphur oxides, or ground-level ozone but does have a high Co2 intensity upstream if produced from fossil fuels such as coal, oil, or natural gas. To make it green hydrogen, it has to be green, and that requires production through water electrolysis.
So We Are At The Time for Ramping up the Electrolyzer
I want to return to the discussion that Armin Schnettler EVP of Siemens Energy had with Kevin O’Donovan here. He was asked, “what are the technical challenges with the (PEM) Electrolyzers?
The reply by Mr. Schnettler was mostly about working on the fundamental technologies of Electrolyzers as the critical needs to make Electrolyzers Industrial ready. He pointed out the PEM technology is presently not mature enough, and this needs more robust solutions.
The list of issues to tackle was in Mr. Schnettler’s opinion:
1) Certainly, get the capital cost down of the Electrolyzer
2) Make the Electrolyzers more compact, in their size,
3) Make sure they have high levels of reliability to operate in industrial application environments for 10 to 20 years and
4) Scaling up the Electrolyzers from the existing 4 MW to the next “ten-factor step” that seems achievable every 4 to 5 years and deliver the 100 MW plant solution next.
5) Finally, to get to these 100 MW solutions as soon as possible and then to 1 GW.
It was here he put it: “it is moving from MW to GW as the challenge (and opportunity)”
Why is this scaling up so important?
Just imagine Siemens have only delivered their latest Gas Turbine, the Siemens 9000HL model recently in the UK to work in a combined-cycle plant. Weighing in at just under 1.1 million pounds (497,000 kilograms), it’ll rotate 3,000 times a minute and generate 593 megawatts of power at peak, likely for decades. That turbine could be argued is “the pinnacle of today’s combustion technologies.”( Bloomberg / Siemens).
All these power generation technologies are competing; all are focusing on not just efficiencies but finding fuel systems that support that technology solution. Electrolyzers need to get into the big league of energy generation, pure and simple, to compete effectively. The pricing of the finished product of Hydrogen has got to get far closer to what the fossil fuel alternatives can deliver today in efficiencies and effectiveness and are matured through well-established solutions and integrated designs.
The significant upcoming advantage for the Electrolyzer is the marginal unit of power generation is coming from a smaller and smaller source. In 2020, the median kilowatt-hour generated in the UK will come from a plant of 596 MW of capacity. In 2040, the median kilowatt-hour will come from a plant of only 40 MW of capacity. (Source: Bloomberg). The other is by using the Water Electrolyzer (PEM) it is better to combine with other variable renewable sources for a faster ramp-up and giving a totally carbon-free fuel or product solution that offers a clean, sustainable alternative.
The commercial competitiveness of the electrolyzer will depend on the ability to advance the underlying technologies. These I will be exploring in my next post.
The need is for technology improvements of higher efficiencies, less degradation, higher availability, larger cell sizes, higher operating pressures, less reduced critical materials together with this need for reduced material size (Armin’s compactness).
Getting to this, the plants will require a significant plant production capacity ramping up and becoming more automated. That plant ramping up will need more automation production of the Electrolyzer cell components, the cells, and stacks to build GW scale electrolyzer plants. Then you will have a set of different challenges at the installing site, where the cost of electricity becomes critical. Coupling low-cost renewable energy with Electrolyzers makes them viable.
So the push by Governments brings up closer to the tipping point of building a significant renewable Hydrogen business in the next decades. Already according to Wood MacKenzie, the green hydrogen pipeline more than doubled in five months from 3.2 GW to 8.2 GW of electrolyzer investments by 2030
The plan in Europe is to take the share of Hydrogen from less than 2% to 13-14% of the European energy Mix.
So as we all look to Electrolyzers as the solution towards offering a power source of Hydrogen it is 1) the technology developments needed to be well-mastered, 2) to build out capacity volumes to bring down unit prices, 3) we need to see GW scale to make them industrially attractive,4) renewable integrated electricity- hydrogen partnerships and 5) integrated project development, construction, and installation approaches, so these solutions can ensure electrolyzers competitive. And that is a long hard road to travel between now and 2030 to get the Electrolyzer the Real alternative to other power generation options.
Exploring this further
So we need to look a little more at the Electrolyzer and see if it is scalable in asset readiness, system design, and value chain developed to offer an Industrial shift to Hydrogen in these next 5 to 10 years.
To understand this readiness and the issues to be addressed, I decided to take a further, more in-depth dive into Electrolyzers. You will find my outcomes from my research and piecing different parts of the Electrolyzer puzzle together over on my dedicated energy transition posting site: https://innovating4energy.com.
I plan to explore and explain some of the significant obstacles to be overcome in ramping up today’s “pilot” electrolyzers into full-scale industrial-grade solutions. Electrolyzer solutions than can compete with other power generation technologies, ones that are very mature and will certainly not yield their established market space without a fight and some compelling arguments of the reasons to change.
A more in-depth review of Electrolyzers can be found on my dedicated posting site for all thongs of Energy Transition by clicking this link “Show me an Electrolyzer.“