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5 Reasons Why Green Hydrogen Could Become Commercially Viable Soon

As a storable, energy-dense, and zero-carbon emitter, hydrogen has the potential to play a pivotal role in forging a low-carbon future. But there’s a caveat. On its own, H2 emits no greenhouse gases or pollutants. However, its production is heavily dependent on fossil fuels. So, for hydrogen to make a real impact, it needs to be clean - and green.

However, high production costs, poor infrastructure, and the availability of renewable electricity have been significant roadblocks to scaling up green hydrogen. Not anymore. According to a recent report by Mckinsey, clean hydrogen will help reduce seven gigatons or 20% of human-led carbon emissions every year by 2050.

Wondering what factors will drive the large-scale of green hydrogen and make it economically feasible? In this blog, we share five drivers that cab expedite the green hydrogen economy

Factors Speeding Up the Viability of Green Hydrogen

Clean hydrogen holds the potential to decarbonize several sectors, from steelmaking, fertilizer production, and long-haul mobility to power generation. However, most of it is produced using natural gas with a considerable carbon footprint. This type of hydrogen is called “Grey” hydrogen. In contrast, Green hydrogen is made with renewable electricity through electrolysis - a process that splits water molecules into hydrogen and oxygen.

Only green hydrogen can help the world mitigate the effects of climate change and achieve net-zero emission goals. On that note, let’s take a look at the factors that are working to make green hydrogen more accessible.

1.Growing Global Infrastructure Investments in Scaling Up Green Hydrogen Production

In the last few years, over 680 large-scale projects and a staggering $240 billion of direct investments have been announced to ramp up green hydrogen production, usage, transportation, and infrastructure. Of these, 314 and 103 projects come from the EU and North America, respectively, clearly highlighting their focus on decarbonizing their economy via clean hydrogen.

A significant chunk of investments has been poured into scaling up production, followed by transmission, storage, and distribution. The goal is to make hydrogen more accessible by connecting export hubs with demand hubs, expanding refueling station infra, and setting up pipelines. Meeting hydrogen demand in applications such as steel production and mobility is another area that has received investments.

2.Falling Costs of Renewables

The high cost of green hydrogen is, in large part, determined by the price of renewable electricity. Thankfully, the cost of solar and wind power is on a steady decline and have fallen sharply between 2010 and 2020 due to evolving technologies, competitive supply chains, and economies of scale - so much so that the next-gen solar and wind power plants are beating even the traditionally cheaper, carbon-emitting coal-fired plants in operating costs.

3.Improving Electrolyzer Technologies

As it stands, green hydrogen costs significantly more than grey hydrogen out of its dependence on clean electricity and the prohibitively expensive electrolyzers. There’s clearly a need for cost-reduction strategies to make electrolyzers more accessible and cheaper.

According to Internation Renewable Energy Agency (IRENA), steps such as increasing module size and stack manufacturing with automated processes in large-scale manufacturing facilities can significantly lower costs by bringing in economies of scale. IRENA recommends increasing the size of the plant from the standard 1 MW to 20 MW, which can slash costs considerably and increase efficiency and flexibility in operations.,/p>

4.Ground-Breaking AIoT and Sensing Technologies Boosting Hydrogen Safety & Production Efficiency

A study estimated that artificial intelligence (AI), machine learning (ML), and Internet of Things (IoT) technologies could reduce CAPEX and OPEX by 15%-25% by optimizing and automating systems. This, in turn, would speed up the viability of green hydrogen by 4-7 years For a hydrogen production plant to operate efficiently and safely with minimal energy losses, it must be designed intelligently, equipped with advanced sensing, and monitored in real-time to enable investors to make better-informed decisions. A combination of artificial intelligence and the Internet of Things is proving to be a game-changer here.

First off, we have the AIoT-enabled Digital Twin technology that can help in optimizing the design of a production facility by creating an exact virtual replica. Next comes performance monitoring. By giving access to real-time performance indicators like energy consumption, purity, production rates, and leaks via sensing and cloud-based technologies, AIoT can help catch errors and streamline the workforce. That’s not all. AIoT also offers actionable insights by integrating data from plants, storage tanks, pipes, and weather to minimize energy losses and maximize returns.

5.Unprecedented Interest by Governments and Policymakers Globally to Prioritize Green Hydrogen Economy

The last few years have seen nearly all major global economies come out with a slew of initiatives in the form of investment tax credits, pilot project funding, policies, and regulatory framework to grow the global hydrogen economy.

Launched by the U.S. Department of Energy, Hydrogen Earthshot focuses on making green hydrogen more cost-competitive and creating demand by unlocking new markets. The goal is to lower the cost of clean hydrogen from the current $5/kg to $1/kg in the coming decade. Not only will this help in reducing emissions, but it will also increase energy security and create jobs across the country.

EU’s vision for green hydrogen is equally ambitious. The roadmap published in European Commission’s Hydrogen Strategy for a Carbon-Neutral Europe calls for a combined electrolyzer capacity of 40 GW and the production of up to 10 million tonnes of clean hydrogen by 2030. This will make it cost-competitive and technically feasible for existing as well as new applications.

Final Thoughts

According to a paper published in Nature Energy, if the current trajectory and policy support continues, green hydrogen could become economically feasible in industrial-scale supplies in a decade. An analysis by Bloomberg Finance pegs the cost of hydrogen in most parts of the world to fall steeply to $2/kg by 2030 and $0.7-$1.6/kg by 2050. As encouraging as these projections already sound, we believe with policymakers announcing more programs and incentives, green hydrogen projects will see a surge in investments, fast-tracking its viability.

But these efforts won’t add up to much unless we make hydrogen absolutely safe for public consumption. Being highly flammable and prone to leakages, safe handling and use of hydrogen requires strict safety measures.

At 21Senses, we offer fast, sensitive, and reliable detectors to monitor leaks and measure hydrogen purity in moisture-laden conditions of an electrolyzer. Our sensors are intentionally compact and can fit into any electrolyzer design. Click here to reach out to us.

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