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Despite an infamous past, hydrogen may have a bright energy future

As the world seeks to rebuild from the coronavirus pandemic, support is pouring in for hydrogen energy to cut carbon emissions and create jobs.

Why it matters: The obscure energy source could help tackle climate change in the thorniest parts of the global energy system, like shipping and power storage. But it’s prohibitively expensive and would need lots of government support to get off the ground.

Where it stands: Of the $54 billion in economic stimulus funding approved in countries around the world (but mostly Europe) that’s going toward clean energy, 19% of that is for hydrogen. That’s second only to electrified transportation, according to BloombergNEF.

In just the past month…

  • The European Union, which is proposing an additional $500 billion or more for green energy as part of its recovery, unveiled a sweeping hydrogen strategy and targets for hydrogen made from renewable energy.
  • The U.S.-based conglomerate Air Products & Chemicals announced plans to build in Saudi Arabia what it says will be the world’s largest hydrogen plant powered by renewable energy.
  • The U.S. Energy Department announced $64 million worth of funding for hydrogen projects earlier this month and plans to invest up to $100 million over five years for two new research efforts on hydrogen.
“I have rarely seen, if ever, any technology that enjoys so much political backing around the world. Countries who have completely different views on energy and climate all join saying that hydrogen is a key clean energy technology.”
Fatih Birol, International Energy Agency executive director

Flashback: When you think of hydrogen, perhaps what comes to mind is bombs or the Hindenburg explosion of 1937, wherein an airship buoyed by hydrogen exploded and killed dozens of passengers — and the future of airships like that.

How it works: But in fact, experts say hydrogen’s infamous past is not its main problem right now, because its intended uses are far different. The biggest hurdle is the cost of transforming the light, odorless gas into usable formats.

  • “In my view, hydrogen is today where solar was 10 years ago,” Birol said. He expects costs to decline as governments grow policies supporting it like they did with solar.
  • Hydrogen produced from natural gas is already in use for industrial processes and a small subset of cars, which was all the rage in the 2000s and backed by then-President George W. Bush. But electric cars appear to be pulling away as the winner in that category.
  • What we’re talking about now is using hydrogen derived from cleaner methods, especially with renewable energy and natural gas with carbon dioxide captured. The uses would beas varied as storing electricity and fuel for big trucks and ships.

The intrigue: Everyone from Joe Biden, the Democrats’ presumptive presidential nominee, to Saudi Aramco, the world’s largest oil company, is ostensibly on board with hydrogen.

  • Biden’s recently expanded climate and energy plan supports using renewable energy to make “carbon-free hydrogen” at the same cost it does from making it with natural gas.
  • The Hydrogen Council, a consortium launched at the 2017 World Economic Forum in Davos, Switzerland, started with 13 members and now has more than 80 members. They include Saudi Aramco and a hodgepodge of auto, oil and gas and other industrial companies.

But, but, but: Environmental scrutiny awaits, and the jobs benefit is not coming any time soon.

Although the Sierra Club doesn't have an official position on hydrogen (yet), its director of global climate policy, John Coequyt, says the group would likely only support hydrogen made purely with renewable energy, not natural gas with captured CO2, which is where a lot of support from industry lies.

  • Experts in this area use different colors to describe how clean hydrogen is. (Green is cleanest to denote that it’s coming from renewable energy, gray is dirtiest, etc.)
  • “People don’t understand hydrogen, let alone the six colors we are using to describe it,” Coequyt said (it’s actually four colors). “It would be very possible to see a situation where people think they’re getting one thing, but for a very long time they get a different thing even if eventually it gets transitioned.”
  • Coequyt cited a power plant in Utah as an example of a hydrogen project that will be predominantly powered by natural gas for many years, if not decades, before it could in theory be transformed to renewable-energy hydrogen.

Jobs won’t immediately be created with hydrogen either, according to Esben Hegnsholt, global energy transition team leader at the Boston Consulting Group. It’s a longer term economic strategy, which is generally good, but not particularly helpful today with jobs lost in the pandemic, he says.

  • “Those who get hydrogen right will be able to get a long-term competitive edge on a state or country level, but it’s not going to immediately create millions of jobs,” said Hegnsholt. “There will be jobs created this decade, but we’re counting years not months.”

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