Home
hamburger menu icon

Hydrogen

In this section, we examine the current and potential role of hydrogen in the economy and compare the economic and environmental costs of several methods of producing hydrogen.

We show below that, under common price assumptions, electrolyzed hydrogen is not yet a cost-effective strategy. Other elements of a hydrogen economy, which depend on abundant electrolyzed hydrogen, are thus not cost effective either. This may change in the future.

Potential Hydrogen Economy

Hydrogen can meet most non-electricity energy end uses and also improve the functioning of the power grid. For some roles, there are few other low-carbon options available, but the high cost of hydrogen and associated infrastructure is a major challenge.

Hydrogen Use Options
UsageCurrent Dominant MethodRationaleChallenges
Residential and Commercial Heating and CookingNatural gas, electricity, fuel oil, biomassCan be added to existing gas pipelines; augment heat pumps on cold days.Safety; Competition with electricity and district heating
AutomobilesGasoline from crude oilGravimetric density of hydrogen, vehicle rangeLack of infrastructure; high cost of vehicles and fuel
TruckingDiesel from crude oilFew low-carbon optionsInfrastructure; high cost
AviationKerosene from crude oilFew low-carbon optionsSignificant R&D needed
ShippingDiesel from crude oilFew low-carbon optionsHigh cost
Rail TransportDiesel, electricityLower capital cost than electricCompetes with electric rail; not suitable for freight
Synthetic HydrocarbonsFossil FuelsFits with current transportation infrastructureHigh cost
Seasonal Energy StoragePumped HydroLimited seasonal storage optionsLow efficiency
Grid Load BalancingVarious StrategiesDemand response can balance a high-renewable gridIncreases cost of hydrogen
SteelCoke from coalFew low-carbon optionsSignificant R&D needed
Industrial HeatCoal and natural gasBest low-carbon option for some heat applicationsHigh cost
Plastics and Other ChemicalsPetrochemical feedstocksFew low-carbon optionsHigh cost
Distributed EnergyDiesel generators, solarRemote applications, resilience, local energy storage---
AmmoniaHaber-Bosch ProcessCould fulfill several important roles in the energy system---
MethanolSynthesis Gas (mostly from fossil fuels)Could fulfill several important roles in the energy system---

Summary of major potential roles for hydrogen in the energy economy. Not every potential role is considered. The following data sources are cited for heating and cooking 1, fuel cell cars 2, trucks 3, planes 4, cargo ships 5, 6, trains 7, load balancing 8, steel 9, industrial heat 1, and chemicals 8. See also our analysis of urban heat, cars, avaiation and rail, freight, synthetic fuels and methane, energy storage, load balancing, steel, chemicals, ammonia, and methanol.

Hydrogen is only a low carbon solution if it is produced from a low carbon energy source.

The Hydrogen Council envisions $20-25 billion investment per year to produce 78 exajoules of hydrogen per year by 2050 10.

Current Production and Consumption

The world produces about 74 million tons of hydrogen each year 8, with an energy content of about 9-11 exajoules and financial value of $115 billion 11, from the following sources.

The image: "hydrogen_source.svg" cannot be found!

Source: Committee on Climate Change 1.

Today, hydrogen is used primarily for industrial purposes 12, 8.

The image: "hydrogen_usage.svg" cannot be found!

Source: IEA (12 and 8).

Cost of Production

The following estimates the cost of producing hydrogen by several methods.

The image: "lcoh.svg" cannot be found!

Levelized cost of hydrogen, which is the price a hydrogen producer, using the given method, must receive to be profitable. Thermochemical and photochemical production are not commercially mature. For nuclear thermochemical, the projected cost is the average of the projected costs of the sulphur-iodine and copper-chlorine cycles. Sources: SMR (with and without CCS), Coal (with and without CCS), and Electrolysis from the IEA 13, solar thermochemical figures from Hinkey et al. 14; the solar photochemical figure from Pinaud et al. 15; and other figures from Parkinson et al. 16.

Problem:
Hydrogen Costs
Solution:
Nuclear Hydrogen Production R&D

Electrolyzed hydrogen is, at this time, not cost-effective in general, while carbon capture and sequestration might be if reduction of CO₂ emissions is sufficiently valued.

The image: "h2_production.svg" cannot be found!

Direct financial, CO₂ valued at $50/ton, and other external costs of methods of hydrogen production. We assume a 50,000 kg/day plant, the treshhold between a medium and large plant in 17.

Most analysts, including our own work, do not find electrolyzed hydrogen to be cost-effective on a large scale at present, though some analyses 18 find niche potential for hydrogen produced by low-carbon electricity.

Improving efficiency and decline electrolyzer costs are among the factors that are driving down the cost of electrolyzed hydrogen.

The image: "electrolyzer.svg" cannot be found!

Characteristics of alkaline and proton exchange membrane electrolyzers. Source: IRENA 11.

Solid oxide electrolyzer cells (SOEC) are still in the laboratory, but they have the potential to beat ALK and PEM cells on cost and to have particular applications to producing synthetic fuels 11.

Problem:
Electrolyzer Costs
Solution:
R&D Into Electrolyzer Technology

Environmental Impacts

Following are estimated greenhouse gas emissions 16, non-greenhouse gas external costs, and land use requirements for different methods of producing hydrogen.

The image: "hydrogen_impacts.svg" cannot be found!

Estimated greenhouse gas emissions, as reported by Parkinson et al. 16, non-greehouse gas external costs, and land use requirements for hydrogen production. For non-GHG externalities and land use, impacts are estimated to be equal to those of producing electricity from an equal amount of primary energy. Calculations are based on contemporary efficiencies of hydrogen production from input energy sources as reported by the GREET model 19 and projected efficiency from thermochemical production, as estimated by Schultz 20.

A 2021 paper 21 claims that blue hydrogen (steam methane reforming from natural gas with carbon capture and sequestration) has only 18-25% less greenhouse gas emissiosn than gray hydrogen (SRM without CCS), but these calculations are based on an unusually high amount of methane leakage and a 20 year global warming potential, instead of the more common 100 year GWP. When more standard assumptions are used, the GHG impacts of blue and gray hydrogen are close to the values reported above 22.

References

  1. Committee on Climate Change. "Hydrogen in a low-carbon economy". November 2018. ↩ ↩2 ↩3

  2. Schoette, B., Sivak, M. "The Relative Merits of Battery-Electric Vehicles and Fuel-Cell Vehicles". The University of Michigan Transportation Research Institute. February 2016. ↩

  3. Zhao, H., Wang, Q., Fulton, L., Jaller, M., Burke, A. "A Comparison of Zero-Emission Highway Trucking Technologies". University of California Institute of Transportation Studies. October 2018. ↩

  4. Khandelwal, B., Karakurt, A., Sekaran, P., Sethi, V., Singh, R. "Hydrogen powered aircraft : The future of air transport". Progress in Aerospace Sciences 60, pp. 45-59. July 2013. ↩

  5. Minnehan, J., Pratt, J. "Practical Application Limits of Fuel Cells and Batteries for Zero Emission Vessels". Sandia National Laboratories, Sandia Report SAND2017-12665. November 2017. ↩

  6. Saito, N. "The economic analysis of commercial ships with hydrogen fuel cell through case studies". World Maritime University Dissertations 618. November 2018. ↩

  7. Harvey, R. "Hydrail: Moving Passengers Today and Freight Tomorrow". H2@Rail Workshop Lansing, MI. March 2019. ↩

  8. International Energy Agency. "The Future of Hydrogen: Seizing today's opportunities". June 2019. ↩ ↩2 ↩3 ↩4 ↩5

  9. Fischedick, M., Marzinkowski, J., Winzer, P., Weigel, M. "Techno-economic evaluation of innovative steel production technologies". Journal of Cleaner Production 84, pp. 563-580. December 2014. ↩

  10. Hydrogen Council. "Hydrogen scaling up: A sustainable pathway for the global energy transition". November 2017. ↩

  11. Taibi, E., Miranda, R., Vanhoudt, W., Winkel, T., Lanoix, J., Barth, F. Hydrogen from renewable power: Technology outlook for the energy transition. International Renewable Energy Agency, Abu Dhabi. ISBN: 978-92-9260-077-8. September 2018. ↩ ↩2 ↩3

  12. International Energy Agency. "Hydrogen". Tracking Clean Energy Progress. Accessed August 17, 2019. ↩ ↩2

  13. International Energy Agency. "Global average levelised cost of hydrogen production by energy source and technology, 2019 and 2050". September 2020. ↩

  14. Hinkley, J., Hayward, J., McNaughton, R., Edwards, J., Lovegrove, K. "Concentrating Solar Fuels Roadmap: Final Report". Australian Renewable Energy Agency Project Solar Hybrid Fuels (3-A018). January 2016. ↩

  15. Pinaud, B., Benck, J., Seitz, L., Forman, A., Chen, Z., Deutch, T., James, B., Baum, K., Baum, G., Ardo, S., Wang, H., Miller, E., Jaramillo, T. "Technical and economic feasibility of centralized facilities for solar hydrogen production via photocatalysis and photoelectrochemistry". Energy & Environmental Science 6(7), pp. 1983-2002. July 2013. ↩

  16. Parkinson, B., Balcombe, P., Speirs, J., Hawkes, A., Hellgardt, K. "Levelized cost of CO₂ mitigation from hydrogen production routes". Energy & Environmental Science 12, pp. 19-40. 2019. ↩ ↩2 ↩3

  17. Randolph, K., Chapman, B. et al. "Hydrogen Production Tech Team Roadmap". Chevron, ExxonMobil, Shell Oil Products US, National Renewable Energy Laboratory, Pacific Northwest National Laboratory, U.S. Department of Energy, Fuel Cell Technologies Office, U.S. Department of Energy, Office of Fossil Energy, U.S. Department of Energy, Office of Nuclear Energy. November 2017. ↩

  18. Glenk, G., Reichelstein, S. "Economics of converting renewable power to hydrogen". Nature Energy 4, pp. 216-222. February 2019. ↩

  19. Argonne National Laboratory. "GREET Model". Accessed June 22, 2019. ↩

  20. Schultz, K. "Thermochemical Production of Hydrogen from Solar and Nuclear Energy". General Atomics. Presentation to the Stanford Global Climate and Energy Project. April 2003. ↩

  21. Howarth, R. W., Jacobson, M. Z. "How green is blue hydrogen?". Energy Science & Engineering 9(10), pp. 1676-1687. October 2021. ↩

  22. Bauer, C. et al. "On the climate impacts of blue hydrogen production". ChemRxiv, Cambridge: Cambridge Open Engage; 2021; This content is a preprint and has not been peer-reviewed. September 2021. ↩