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Aug-2023

Hydrogen economy Part 1: Supply, demand, reliability and safety

Implementing strategy across the hydrogen supply chain as a critical component in addressing climate change

Robert Ohmes, Nathan Barkley, Mike Annon, Greg Zoll, and Jessica Hofmann
Becht

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Article Summary

As governments as well as energy and research firms look to meet global carbon footprint reduction targets, many options are being examined, analysed, and invested in. One such option within the core of the energy transition is hydrogen. Long being a basic building block for transportation fuels, petrochemicals, and specialty products, hydrogen is now considered a critical component to address climate change. 

Based on current projections, in order to meet 2050 net zero targets, global production of hydrogen will need to grow from around 90 to more than 500 million metric tons (MmT) per year. The production and usage options for hydrogen are expanding on a regular basis, as are the challenges of leveraging this molecule. Within this two-part series, we will examine the overall hydrogen supply chain; identify key risks, challenges and issues within the technical, economic, reliability, and regulatory arenas; and provide insights and case studies to help address these areas to drive the transition to a hydrogen-based economy. Part One addresses the value chain elements of supply, demand, infrastructure, as well as reliability and safety. Part Two will discuss the economic and regulatory aspects of the hydrogen economy. 
 
Overall hydrogen supply chain
The three main functional areas in the hydrogen supply chain are production, distribution (supply), and consumption (demand) (see Figure 1). Underpinning each of these areas are the technical feasibility, process safety, mechanical integrity, financial, and regulatory criteria that must be met for the supply chain to function and remain viable. The key challenge with the hydrogen economy in its present state is that each of these criteria need to be assessed, built out, and made more efficient in order to be sustainable. 

Consumers
As with most products within an economic system, the value flow starts with the demand side and how the product will be used. Historically, most hydrogen has been used within the fossil fuels industry to produce transportation fuels, to meet low sulphur and emission quality mandates, and to convert low- value crude oil cuts into highly valued products. Future growth in hydrogen consumption will be driven by the need to reduce CO? emissions. Hydrogen is essential for the production of ‘zero-carbon emission’ combustion sources, converting seed oils, animal fats, and used cooking oils into renewable diesel and sustainable aviation fuel, and transforming renewable electricity into e-fuels. Hydrogen can also be considered a medium for longer term storage of renewable power.

Within the refining sector, replacing existing hydrogen sources with decarbonised (such as low carbon intensity) hydrogen is relatively straightforward as long as the production volumes are available and sustainable and the logistics are in place. Fundamentally, as long as it meets the quality and supply condition targets, the refining process unit does not differentiate the source of the hydrogen. However, for some of the newer uses of hydrogen, limitations can exist on how far its usage can be expanded.
As an example, in order to decarbonise combustion sources for heat, whether it be within a process heater, home or office heating, or even cooking, hydrogen as a combustion fuel becomes a viable mechanism to reduce CO? emissions, as the product of hydrogen combustion is primarily water. While post-combustion CO? removal, which involves extraction of CO? from the combustion flue gas and sequestering, can be retrofitted to existing industrial plant, it is not practical in household heating applications. One novel alternative is to remove the CO? pre-combustion.  

The basic flow scheme for pre-combustion CO? capture is to reform streams such as natural gas, produced gas and lighter liquid fuels or to gasify heavier hydrocarbon streams to create syngas (CO and H?) and then process the syngas in a water gas shift reactor to convert the CO to CO? and separate out the hydrogen for use as the downstream combustion fuel source. The primary advantages of this approach are 

  •  A higher concentration of CO? for more effective extraction 
  •  A reduced number of processing points and facilities to capture CO? 
  • The ability to provide a consistent fuel source to downstream consumers. 

However, this option does come with challenges. Firstly, hydrogen has a lower heating value on a standard volume basis compared to other typical fuel sources (such as natural gas), which means that up to three times as much standard volume of fuel will be required to meet the caloric requirements for combustion. Therefore, fuel supply lines, system pressures, pressure control valves, and even burners may have to be modified to use high percentages of hydrogen. Secondly, hydrogen has a higher flame temperature compared to other fuel sources, which impacts firebox performance and NOx emissions. One benefit of firing hydrogen is that the oxygen and, therefore, air requirements are lower for the same heat release, potentially reducing induced and forced air blower power requirements and debottlenecking draft-limited furnaces. 

While the firing of high hydrogen content streams in industrial heaters is highly plausible, the use of hydrogen to replace natural gas within commercial and home heating systems can be more challenging. Based on most evaluations, typical natural gas pipelines and home/commercial users can utilise between 5 and 10% hydrogen within the fuel system. The use of higher concentrations would require modification of the pipeline and compression supply systems as well as the point source combustion equipment and fugitive emissions.


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