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    Up off the mat [Gas in Transition]


Blue hydrogen has taken its share of criticism from environmentalists lately. Now, supporters are starting to hold sway in the discussions around its place in the energy transition. [Gas in Transition, Volume 1, Issue 7]

by: Dale Lunan

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Up off the mat [Gas in Transition]

With COP26 in Scotland just over the horizon next month, fossil fuel opponents are ramping up their rhetoric against blue hydrogen, claiming it supports continued use of natural gas in global energy systems.

Europe has already bent – but not quite broken – in the face of that rhetoric. The EU’s recently released hydrogen strategy, for example, heavily favours green hydrogen over blue, but the European Parliament has agreed to allow some gas infrastructure projects status as Projects of Common Interest, a move viewed positively by Hydrogen Europe.

Even EC energy commissioner Kadri Simson, who has blamed the energy crisis in Europe not on misguided green policies but on the bloc’s ongoing reliance on fossil fuels instead of renewables, admitted when releasing the EC’s Fit for 55 that “we will need also low-carbon hydrogen, not only renewables.”

While European lawmakers appear content to sit on the fence about blue hydrogen’s future, others are moving forward on the assumption that, whatever the world’s ambitions for green hydrogen might be, blue hydrogen, like natural gas itself, is a necessary step in the ongoing – and increasingly long-lived – global energy transition.

France’s TotalEnergies and Air Liquide are working to decarbonise hydrogen production at the French major’s Normandy refinery by capturing CO2 and storing it at the Northern Lights and Aramis carbon capture and storage (CCS) projects under development in the North Sea.

Now other supporters of blue hydrogen are taking up the cause, debunking major anti-blue arguments that using CCS to clean up conventional hydrogen production from natural gas is as dirty – and maybe dirtier – than burning the natural gas itself.

An international group of academics – spanning the UK, Canada, the US, Switzerland, Germany, Italy and the Netherlands – has produced a report showing that blue hydrogen can be nearly as impactful on climate change as green hydrogen, which itself is not, under certain conditions, as benign as many would have us believe.

US major Chevron also sees a place for blue hydrogen – alongside green – in the future energy mix. It’s already developing large green hydrogen projects in the western US, but it’s also assessing the development of blue hydrogen production hubs throughout the US and in Asia linked to its existing natural gas production and storage assets.

To facilitate its blue hydrogen aspirations, Chevron is pursuing carbon capture, utilisation and storage (CCUS) on several fronts, targeting the permanent sequestration of some 35mn mt/yr of CO2 by the end of this decade.

In the UK, Project Cavendish, a multi-national consortium that includes Anglo-Dutch major Shell and German utility Uniper, is planning a 700-MW blue hydrogen plant on the Isle of Grain. Captured CO2 would be stored by the Acorn CCS project, which is itself planning a blue hydrogen component using North Sea gas as feedstock.

Colombia, though faced with dwindling reserves of natural gas from which to manufacture blue hydrogen, has developed a Hydrogen Roadmap laying out a three-stage transition to a hydrogen economy, starting with blue hydrogen before transitioning to green hydrogen post-2030.

Even the oil- and gas-rich Middle East, which hasn’t exactly been at the forefront of the energy transition, is looking to hydrogen as a way to decarbonise at least some of its vast energy resources. Saudi Aramco claims it will have a “large share” of the global blue hydrogen market, while the Abu Dhabi National Oil Co is exploring blue hydrogen opportunities with several Asian partners.

All of this suggests that working hydrocarbon entities are interested in the potential blue hydrogen offers the transition, even if legislative and policy-centric organisations such as the EC and the International Energy Agency (IEA) – which not long ago was suggesting that any future hydrocarbon development would be “inconsistent” with a net zero future – have largely turned their backs on blue hydrogen, preferring instead the “purity” of green hydrogen.

To its credit, however, the IEA appears to be coming around to the potential of blue hydrogen, even if it can’t quite come to terms with calling it “blue”, preferring “low-carbon hydrogen” as a proxy.

In early October, it urged governments around the world to do more to incentivise the creation of low-carbon hydrogen demand. Focusing policies on low-carbon hydrogen production, it said, would be of little use were there not concomitant policies driving demand for it.

“Boosting the role of low-carbon hydrogen in clean energy transitions requires a step change in demand creation,” it said in its Global Hydrogen Review 2021. Some governments are taking early policy steps towards this end – carbon pricing, quotas, auctions and mandates for public procurement are being discussed in political circles – but so far, few of these instruments have actually come into force.

“Their quick and widespread enactment could unlock more projects to scale up hydrogen demand,” the IEA said.

And in its latest natural gas quarterly review, the IEA said it is looking to natural gas and CCUS to provide a stable supply of blue hydrogen; stability in the green hydrogen supply chain, the agency says, is far more difficult to achieve, given the intermittency inherent in renewable sources such as wind and solar on which it depends.

Blue hydrogen offers compelling opportunities to reduce global CO2 emissions. Natural gas producers appear ready to make the financial commitments to realise these opportunities; it’s now time for policy-makers and regulators to give blue hydrogen a hand up off the mat.