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Hydrogen shows great potential in energy transition – Report

The study by DNV GL explains that hydrogen is a unique energy carrier with no carbon emissions that can be used for long-term storage and heating applications

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Dubai recently broke ground on the first solar-driven hydrogen electrolysis facility in the Middle East and North Africa (MENA)
Dubai recently broke ground on the first solar-driven hydrogen electrolysis facility in the Middle East and North Africa (MENA)

A new research paper concludes that hydrogen produced from renewables will become “an economic energy carrier to complement electricity and accelerate the decarbonisation of industrial feedstock and heat, as well as providing long-term storage solutions”.

The study by DNV GL explains that hydrogen is a unique energy carrier with no carbon emissions that can be used for long-term storage and heating applications. When used with electricity generated from renewables, “the resulting energy carrier is carbon-free green hydrogen”.

“The prospect of delivering affordable hydrogen applications in the mid-term future provides a very encouraging signal to accelerate the global energy transition,” said Lucy Craig, Vice-President of Technology and Innovation at DNV GL-Energy.

Our research demonstrates that green hydrogen provides an optimal use for surplus electricity, which we expect to see in the years to come due to the rapid rise of renewable energy. In combination with electrolysis, hydrogen proves to be an economically feasible solution for the decarbonisation of the heat and storage sector.”

DNV-GL believes that the economic viability of green hydrogen will be feasible due to the increasing penetration of wind and solar power in coming years. DNV GL’s Energy Transition Outlook forecasts that solar PV, wind energy and hydropower will account for 80 per cent of global electricity production in 2050.

The study states that as this capacity increases, “opportunities to utilize its low-cost electricity are becoming feasible to avoid curtailment: initially conversion into heat then (daily) battery storage and eventually conversion into green hydrogen”.

DNV-GL says the prerequisite for hydrogen to become an economically viable energy carrier are two-fold. Firstly, the prospect of increasing times with low-cost electricity caused by an oversupply of available energy due to the sharp rise of renewable energy sources. Secondly, use cases for hydrogen applications are expected to be in support of low-carbon options.

If those parameters are set, DNV-GL says the production of hydrogen from electricity can compete with natural-gas based hydrogen production and provides a viable commercial business option for numerous applications, starting with industrial hydrogen feedstock.

DNV GL’s energy experts conclude that the main reasons for the economic feasibility of hydrogen between 2030 and 2050 are driven by three key developments. Firstly, the cost of electrolysers will go down caused by learning curve experiences and the cost of asset developments which is expected to decrease. Production by electrolysis from ‘surplus’ or low- cost electricity from renewables is an option for producing low-carbon hydrogen with no related carbon emissions.

Secondly, time periods when low or zero cost prices for electricity are available will increase due to the rise of renewables, generating a surplus of energy available to the power grid.

And finally, penalization of carbon emissions in coming years, as industries are expected to see a shift away from carbon-heavy activities, for example due to the introduction of carbon tax and incentives for low carbon solutions.

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