Hydrogen has a well-established, if limited, role in the modern economy. It has been used in refining and ammonia production for decades, but its potential has long been touted in various areas, including decarbonizing hard-to-abate industrial processes such as steelmaking, as well as in larger roles in heavy-duty transportation and energy storage. The last few years have seen a significant push to expand hydrogen’s role — an attempt to capitalize on its versatility and lack of carbon dioxide (CO2) emissions — but a number of formidable obstacles to wider adoption remain, including price, availability and infrastructure, in addition to its tenuous political support. In today’s RBN blog, we look at the challenges that make forecasting the industry’s growth difficult and the emerging consensus around the most practical end uses for hydrogen.
We’ve written extensively about hydrogen in the RBN blogosphere over the past couple of years, including the development of several regional hubs in the U.S., our series on the future of low-carbon hydrogen, the unique properties that make it particularly hard to handle, and the final rules around the 45V tax credit, which were wrapped up earlier this year (but which could soon be revoked under budget legislation now being considered by Republicans in Congress). Once a major priority of the Biden administration, which saw it as a key piece of its decarbonization efforts, the outlook for low-carbon hydrogen is far less certain under President Trump, whose administration has prioritized the development of fossil fuels and indicated it could cut or reduce funding already set aside for the hydrogen hubs.
[RBN’s weekly Hydrogen Billboard report tracks domestic and global hydrogen markets, including the development status of dozens of projects, filtering through the noise with an unbiased lens to deliver impactful hydrogen infrastructure and market analysis. To learn more, click here.]
Hydrogen gets high marks for versatility because it can be produced in several different ways from a number of different fuels — including coal, natural gas, nuclear power and renewables — and it has many potential uses. Section A to the left in Figure 1 below shows the primary alternatives to hydrogen, if any (colored rectangles in box in upper-left corner), and breaks down more than two dozen potential applications of hydrogen and the fuel’s competitiveness against other alternatives into four categories, ranked from “necessary” to “uncompetitive.” You’ll note that hydrogen, despite its versatility, is considered a very poor alternative to electricity and batteries (blue-shaded boxes) in applications like bulk power generation, residential heating and personal transportation — all areas where hydrogen was once thought to hold significant potential. Sections B, C and D of Figure 1 show how hydrogen fuel-cell applications (teal lines) changed from 2015-23 in heavy-duty trucking, passenger vehicles and residential heating, respectively.
Hydrogen Applications and Potential Alternatives
Figure 1. Hydrogen Applications and Potential Alternatives. Source: Nature
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