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22 gas for energy Issue 2/2017
REPORTS Hydrogen
“H2@Scale” – an emerging cross-sector opportunity in the USA
by John Stevens, Neha Rustagi, Bryan Pivovar, Mark Ruth, Richard Boardman, Nicholas Gilroy, Fred Joseck, Sunita Satyapal and Reuben Sarkar
The “H2@Scale” concept, led by the U.S. Department of Energy (DOE) and the U.S. National Laboratory system, lays a framework for the potential wide-scale production and utilization of hydrogen to address key issues such as enabling grid resiliency, energy security, and cross-sectoral efficiency improvements and emissions reduc-tions. The premise of the H2@Scale concept is that, in an electricity grid with growing security and balancing needs from increasing penetrations of inflexible generation, such as wind and solar power, water splitting tech-nologies can be used to generate hydrogen as an energy carrier while supporting grid needs.. That hydrogen can then be distributed and used as a feedstock or fuel in industrial and transportation sectors. This integrates these sectors more closely with the electricity grid, and reduces reliance on fossil fuels in end use applications across multiple market sectors.
1. ELECTRICITY MARKETS
Hydrogen has been widely used for decades in mature industries, such as oil refining and ammonia production, with over 10 million metric tons per year produced in the United States via steam methane reforming (SMR) [1], accounting for approximately 2 % of U.S. primary energy use [2]. Another approach to hydrogen production is electrolysis, where electricity, and in some cases heat feedstocks are used to split water into high purity hydro-gen and oxygen. Today, electrolyzers are used in applica-tions where natural gas is not available, SMR is not practi-cal, or where high levels of purity are needed. For electro-lyzers to be meet long-term DOE cost goals [3] and produce hydrogen at a similar cost to SMR, however, the cost of their feedstocks, and the capital cost of electrolyz-ers must be reduced [2].
Falling costs of wind and solar have led to significant growth in U.S. renewable generation capacity [4]. How-ever, meeting aggressive renewable portfolio standards (RPS), such as those in New York, California and Hawaii, will result in larger amounts of seasonal electricity curtail-ment, especially in states that rely heavily on one particu-lar renewable resource to reach their RPS [5, 6]. Absent measures to integrate these resources, this curtailment will increase costs for renewable capacity additions [6] and potentially stifle their deployment, because the con-tinuously declining amount of electricity that new capac-
ity additions can deliver to the grid will result in declining returns on investment. The increase in low-cost intermit-tent power has also proven detrimental to the value proposition of nuclear generators, which in the U.S. do not cycle their power output throughout the day due to operational and regulatory reasons [7].
Short term grid management solutions for integrat-ing renewables include increasing regional coordination, increasing grid flexibility, and deploying battery energy storage. While these efforts are critical in the near future, they do not address longer term weekly or seasonal needs. Batteries do not scale well beyond shifting energy supply over several hours’ time, because the linear rela-tionship between battery power and energy storage capacity makes it too expensive to provide longer term storage [6]. There are limits to the amount of flexibility that can be introduced by changing the way in which fossil fuel powered generators operate [6]. Long-term infrastructure investments in new transmission capacity take years and face significant political hurdles, and do not fully address the fundamental mismatch between low electricity demand and high renewables production during the spring [5]. The shift to electricity grids with high renewable penetrations thus creates emerging mar-ket needs for energy storage technologies that can pro-vide long term energy storage [6, 8].
Electrolyzers are modular, and are currently produced in capacities ranging from less than a kW to several MWs.
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Hydrogen REPORTS
Electrolyzers can utilize this capacity as a form of “respon-sive load,” with lab-demonstrated sub-second response times to increase power draw from the grid to produce hydrogen when electricity generation exceeds demand, and to decrease power draw when demand exceeds generation [9]. When operated in this flexible manner, electrolyzers can reduce the net cost of hydrogen they produce by participating in existing ancillary services markets [10]. Furthermore, flexible electrolyzer operation can allow electrolyzers to utilize lower cost electricity by operating during periods when overgeneration from inflexible generators causes wholesale power prices to decline. In order to retain baseload operation, nuclear generators are also considering using electrolyzers to hybridize with a host of different industrial processes that the generator can supply power to when it is not needed on the grid. Next generation nuclear reactors can yield efficiency gains and cost reductions for producing hydro-gen as a chemical feedstock or fuel [11].
Once produced, hydrogen can be stored in existing natural gas infrastructure], or in dedicated infrastructure [12] at gigawatt-hour scale [13]. Hydrogen can also be combined with carbon dioxide or other chemicals via existing and emerging thermochemical and electro-chemical conversion pathways [3]. This provides a means for seasonal energy storage in existing fossil fuel infra-structure.
2. HYDROGEN MARKETS
2.1 Industrial sector
The H2@Scale concept is anchored by the existence of multi-billion dollar markets for hydrogen, wherein elec-trolyzers can directly substitute conventional production technologies (i.e. SMR), while lowering emissions and reducing consumption of limited resources (e.g. petro-leum and natural gas). Oil refineries and ammonia plants are currently the largest consumers of hydrogen [1], and are supplied by SMR (using natural gas as a feedstock). Diversification to other methods of hydrogen production would free limited U.S. natural gas resources for other, potentially higher value markets (e.g. exports of liquefied natural gas). Moreover, several efforts worldwide have aimed to support or establish a regulatory framework that incentivizes the use of renewable hydrogen in indus-try. The EU’s CertifHy Project Consortium [14] published a roadmap in 2016 for an accounting system that awards credits to renewable hydrogen. Their roadmap was endorsed by 30 members of industry, including the global hydrogen suppliers Air Products, Air Liquide, and Linde. Similarly, California’s Low Carbon Fuel Standard awards saleable credits to refineries that use renewable hydrogen [15].
Hydrogen also has potential as a feedstock that trans-forms existing industrial processes to enable compliance with global environmental imperatives. One example is steelmaking, which accounts for 4–7 % of global green-house gas emissions [16]. Electric arc furnaces (EAFs), are advantageous over conventional blast furnaces because of their lower capital cost and lower emissions (since they do not require coke gas). EAFs can be supplied by many different feedstock, including scrap metal or iron that has already been reduced via “direct reduction” (i. e. direct reduction of iron [DRI]). DRI reduces iron ore using syn-gas, and is commercial in regions of the world with low-cost natural gas. However, DRI via pure hydrogen which is an area of current research, has the potential to further lower the emissions of steelmaking [17].
2.2 Transportation sector
The potential benefits of utilizing hydrogen within the transportation sector are not new. The term ‘hydrogen economy’ was increasingly publicized in the 1970s, focused largely on hydrogen’s potential to displace petro-leum in transportation applications. In 2003, the U.S. gov-ernment introduced the Hydrogen Fuel initiative, “to develop hydrogen-powered fuel cells, hydrogen infra-structure and advanced automotive technologies.” The Energy Policy Act of 2005 (EPAct) directed the DOE to develop a comprehensive program that would enable industry to reach a decision point on the viability of com-mercializing hydrogen fuel cell vehicles by 2015 [18]. Dur-ing the ensuing decade, R&D investments from both government and industry led to game-changing accom-plishments. DOE funded research helped reduce the costs of electrolyzers by 80% and cut the cost of fuel cells in half since 2006 with four times the durability [19].
Three models of fuel cell electric vehicles (FCEVs) have been made commercially available to date, on track with goals set forth in EPAct. More than 1,100 commercial FCEVs were sold in the U.S. in 2016, offering completely zero tailpipe emissions and zero petroleum driving options with performance meeting consumer expecta-tions – up to a 589 km driving range, a few minutes to refuel, and the high torque and quiet characteristics of all-electric platforms. More than 25 hydrogen fueling sta-tions are now publicly open in the U.S. for retail sale of hydrogen. California has committed to funding 100 sta-tions with industry cost share, and at least 12 stations are planned with no government funding in the Northeast [20]. California’s SB1505 law will require 33 % of hydrogen sold in public stations to be renewable [21]. The pace of activity has quickened and in early 2017, thirteen compa-nies with combined revenues of roughly U.S. $1 trillion, joined forces announcing a Hydrogen Council, pledging billions of dollars to jumpstart a hydrogen economy [22].
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REPORTS Hydrogen
These activities are a testament to the revolutionary improvements possible in technologies for hydrogen production, delivery, and use, based upon both govern-ment and industry investments aligned toward specific goals.
3. R&D TO ENABLE H2@SCALE
Widescale deployment of hydrogen requires research to lower costs and improve performance of electrolyzers, infrastructure, and end use applications for hydrogen. A reduction in the capital cost of conventional low-temper-ature electrolyzers is necessary to offset the reduced capacity factors resulting from their proposed flexible operation. With these capital cost reductions and low cost curtailed electricity, the pathway to meeting the DOE goal of U.S. $2/kg hydrogen production costs (on par with SMR in the U.S.) can be realized [2, 3]. These capi-tal cost reductions require the development of durable, high-performance membranes and catalysts that mini-mize or eliminate the use of precious group metals (PGMs). Production of these electrolyzers at industrial scales requires the development of advanced manufac-turing technologies, such as roll-to-roll processing of membranes. Finally, reducing the operating cost of elec-
trolyzers through integration with high-quality process heat (i. e. “high-temperature electrolysis”) requires the development of materials that can retain their integrity and performance at temperatures > 800 °C [3].
Research is also needed in lowering the costs of deliv-ering hydrogen from centralized facilities to end users. Delivery technologies currently in use include pipelines, liquid tankers, and gaseous tube trailers. A reduction in the costs of hydrogen pipelines could be achieved through research that enables codification of modern steels that are used in natural gas pipelines (e.g. X100) but are not yet accepted for hydrogen service. Moreover, an increase in the capacity of hydrogen pipelines will require materials developments that enable compressors with significantly greater throughput than achievable today. Additionally, a reduction in the costs of liquefaction requires the development of game-changing alternatives to conventional mechanical cycles, such as magnetoca-loric liquefaction. Finally, applications wherein hydrogen can lower the emissions of existing technologies must be developed. For example, use of hydrogen as a heating fuel will require the development of materials that can withstand the temperatures of hydrogen combustion. Large-scale use of blends of hydrogen and natural gas will require development of domestic and commercial
Figure 1: H2@Scale schematic
showing cross-sectoral inte-gration of the
electricity grid and the indus-
trial and trans-portation
sectors
Issue 2/2017 gas for energy 25
Hydrogen REPORTS
appliances that can reliably operate safely using hydro-gen [3]. Finally, use of pure hydrogen in DRI requires improved understanding of the kinetics of DRI, and man-agement of mass transfer in DRI reactors [17].
4. H2@SCALE
To further enable and identify the breakthroughs neces-sary for low-cost production of hydrogen from low-cost electricity, and the utilization of hydrogen across various economic sectors, the DOE has introduced the H2@Scale concept (Figure 1).
The DOE national laboratories have conducted a pre-liminary analysis to better define the H2@Scale vision. The first aspect of this analysis was to assess the technical potential of hydrogen production from solar and wind resources in the U.S., relative to regional demand. Analysis (Figure 2) shows that most counties in the U.S. have suf-ficient renewable resources to satisfy their expected demand, even if aggressive growth is assumed in the fuel cell vehicle, natural gas blending, and steelmaking (using DRI with pure hydrogen) sectors. Many of the regions with insufficient technical potential are located near nuclear power plants, which can also be hybridized with electrolyzers as explained above.
A follow-up analysis is currently being performed to address the market potential for the supply of hydrogen from inflexible resources, as well as the cross-sectoral demand for hydrogen as a function of the cost for which it can be delivered to users. This analysis work seeks to determine the scale of hydrogen production that can be realized; the incremental amount of renewable and nuclear power capacity that can be built if flexibly oper-ated electrolyzers reduce seasonal curtailment; the nec-essary capital cost reductions of electrolyzers and other system components to achieve low cost hydrogen pro-duction and delivery; and the amount of U.S. emissions, petroleum use and natural gas use savings that can be realized by utilizing this hydrogen.
In addition to the ongoing analysis work, the DOE and its national laboratories have solicited feedback from stakeholders including through formal requests and workshops to identify key areas of interest and opportunity. A recent workshop held at DOE’s National Renewable Energy Laboratory (NREL) under DOE’s Office of Energy Efficiency and Renewable Energy (EERE) captured input on key topics, including areas requiring R&D [23]. Ultimately, the DOE hopes these efforts will pave the way to a low-cost, large-scale hydrogen energy system.
Figure 2: Regional hydrogen pro-duction poten-tial in the U.S. from solar and wind power, net of potential hydrogen demand
26 gas for energy Issue 2/2017
REPORTS Hydrogen
REFERENCES
[1] MarketsandMarkets: “Global hydrogen Generation Market by Merchant & Captive Type, Distributed & Centralized Generation, Application & Technology- Trends & Forecasts (2011-2016),” http://www.market-sandmarkets.com
[2] Pivovar, B.: “Enhance the U.S. energy portfolio through sustainable use of domestic resources, improvements in infrastructure, and increase in grid resiliency,” in H2@Scale Workshop, Golden, CO, U.S.A., 16.11.2016 https://energy.gov/sites/prod/files/2016/12/f34/fcto_h2atscale_workshop_pivo-var_2.pdf
[3] U.S. Department of Energy: “Fuel Cell Technologies Office Multiyear Research, Development and Dem-onstration Plan” https://energy.gov/eere/fuelcells/downloads/fuel-cell-technologies-office-multi-year-research-development-and-22
[4] U.S. DOE: “Revolution Now 2016 One Pager” https://www.energy.gov/eere/downloads/revolutionnow-2016-update
[5] Schlag, N.; and Brancucci Martinez-Anido, C. et al.: “Western Interconnection Flexibility Assessment: Final Report,” 2015. https://www.wecc.biz/Reliability/WECC_Flexibility_Assessment_Report_2016-01-11.pdf
[6] Denholm, P. and Hand, M.: 2011, “Grid flexibility and storage required to achieve very high penetration of variable renewable electricity,” Energy Policy, 39 p. 1817-1830
[7] Botterud, A. and Jenkins, J.: “Can Nuclear Power Pro-vide Flexibility for Grid Integration of Renewable Energy?” in U.S. DOE, Washington, D.C., 16.02.2017 Wil-liams, J. et al.: “Pathways to deep decarbonization in the United States,” 16.11.2015. http://unsdsn.org/wp-content/uploads/2014/09/US-Deep-Decarboniza-tion-Report.pdf
[8] Williams, J. et al.: “Pathways to deep decarbonization in the United States,” 16.11.2015. http://unsdsn.org/wp-content/uploads/2014/09/US-Deep-Decarboni-zation-Report.pdf
[9] Eichman, J.; Harrison, K.; Peters, M., 2014: “Novel Elec-trolyzer Applications: Providing More than Just Hydrogen” National Renewable Energy Laboratory http://www.nrel.gov/docs/fy14osti/61758.pdf
[10] Eichman, J.; Townsend, A.; Melaina, M., 2016: “Eco-nomic Assessment of Hydrogen Technologies Par-ticipating in California Electricity Markets” NREL http://www.nrel.gov/docs/fy16osti/65856.pdf
[11] Ruth, M. et al., 2017: “The Economic Potential of Nuclear-Renewable Hybrid Energy Systems Produc-ing Hydrogen” NREL http://www.nrel.gov/docs/fy17osti/66764.pdf
[12] Praxair: “Praxair Commercializes Industry’s Only Hydrogen Storage,” 22.10.2007. http://www.praxair.com/news/2007/praxair-commercializes-indus-trys-only-hydrogen-storage
[13] California Hydrogen Business Council: “Power-to-Gas: The Case for Hydrogen White Paper,” 08.10.2015. https://californiahydrogen.org/sites/default/files/CHBC%20Hydrogen%20Energy%20Storage%20White%20Paper%20FINAL.pdf
[14] CertifHy: “Publications and Deliverables.” http://www.certifhy.eu/publications-and-deliverables.html
[15] California Air Resources Board: “Low Carbon Fuel Standard,” https://www.arb.ca.gov/fuels/lcfs/lcfs.htm
[16] Strategic Energy Technologies Information System: “Energy Efficiency and CO2 Reduction in the Iron and Steel Industry” https://setis.ec.europa.eu/system/files/Technology_Information_Sheet_Energy_Effi-ciency_and_CO2_Reduction_in_the_Iron_and_Steel_Industry.pdf
[17] Sohn, H.: “Novel Flash Ironmaking Technology (FIT),” in H2@Scale Workshop, Golden, CO, U.S.A., 16.11.2016. https://energy.gov/sites/prod/files/2016/12/f34/fcto_h2atscale_workshop_sohn.pdf
[18] U.S. Congress, 2005: “Energy Policy Act of 2005.” https://www.gpo.gov/fdsys/pkg/PLAW-109publ58/pdf/PLAW-109publ58.pdf
[19] U.S. DOE, 2016: “Fuel Cell Technologies Office Accom-plishments and Progress.” Washington, D.C. https://energy.gov/eere/fuelcells/fuel-cell-technologies-office-accomplishments-and-progress
[20] U.S. DOE, 2016: “Fuel Cell Technologies Office: 2016 Recap and the Year Ahead” https://www.energy.gov/eere/fuelcells/articles/fuel-cell-technologies-office-2016-recap-and-year-ahead
[21] G. Achtelik (2009): “California Regulations on Renew-able Hydrogen and Low Carbon Technologies” https://energy.gov/sites/prod/files/2014/03/f12/renewable_hydrogen_workshop_nov16_achtelik.pdf
[22] Air Liquide, 2017: “New ‘Hydrogen Council’ Launches in Davos,” http://hydrogeneurope.eu/wp-content/uploads/2017/01/20170109-HYDROGEN-COUNCIL-Vision-document-FINAL-HR.pdf
[23] NREL: “H2@Scale Workshop” in Golden, CO, U.S.A. 16.11.2016-17.11.2016 https://energy.gov/eere/fuel-cells/downloads/h2-scale-workshop
Issue 2/2017 gas for energy 27
Hydrogen REPORTS
AUTHORS
Dr. John Stevens, Ph.D.U.S. Department of EnergyWashington, D.C., U.S.A.Phone: +01 202-586-5000Email: [email protected]
Ms. Neha Rustagi, M.Sc.U.S. Department of EnergyWashington, D.C., U.S.A.Phone: +01 202-586-5000Email: [email protected]
Dr. Bryan Pivovar, Ph.D.National Renewable Energy LaboratoryGolden, CO, U.S.A.Phone: +01 303-275-3000Email: [email protected]
Mr. Mark RuthNational Renewable Energy LaboratoryGolden, CO, U.S.A.Phone: +01 303-275-3000Email: [email protected]
Dr. Richard Boardman, Ph.D.Idaho National LaboratoryIdaho Falls, ID, U.S.A.Phone: +01 866 495-7440Email: [email protected]
Mr. Nicholas Gilroy, M.Sc.National Renewable Energy Laboratory
Golden, CO, U.S.A.
Phone: +01 303-275-3000
Email: [email protected]
Mr. Fred Joseck, M.B.A.U.S. Department of EnergyWashington, D.C., U.S.A.Phone: +01 202-586-5000Email: [email protected]
Dr. Sunita Satyapal, Ph.D.U.S. Department of EnergyWashington, D.C., U.S.A.Phone: +01 202-586-5000Email: [email protected]
Mr. Reuben Sarkar, M.Sc., M.B.A.U.S. Department of EnergyWashington, D.C., U.S.A.Phone: +01 202-586-5000Email: [email protected]
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