Tag: Electrolysis

Green Hydrogen to Increase Gas Bills

Green hydrogen is expensive, and the Government is planning to increase your gas bill to pay for it.

From Watts Up With That?

David Turver’s Substack EIGEN VALUES

By David Turver

Green hydrogen is expensive, and the Government is planning to increase your gas bill to pay for it.

Introduction

We have covered in earlier articles how the UK has the highest electricity prices in the developed world and very high gas prices compared to international competitors like the US and Canada.

The problem of high energy prices has become mainstream with even the Energy Security and Net Zero Select Committee in Parliament launching inquiry into high energy costs. [Note that I have submitted written evidence to the inquiry, but cannot publish it until they have, so watch this space]. Readers will be dismayed to learn that the Government is now consulting on its latest cunning wheeze to further increase our energy bills by charging the cost of their cherished green hydrogen plans to our gas bills using the Gas Shipper Obligation (GSO).

Green Hydrogen Plans

Of course, hydrogen is a colourless and odourless gas, but hydrogen is assigned different colours according to the method of production. We covered the hydrogen rainbow in an earlier article. Green hydrogen is produced by electrolysis powered by renewables like wind and solar. Blue hydrogen is produced from natural gas and the resulting carbon dioxide emissions are captured and stored.

The last Conservative Government launched its hydrogen delivery roadmap back in December 2023. This called for “up to” 10GW of hydrogen production capacity by 2030 made up of 6GW of green hydrogen and 4GW of blue hydrogen.

The first tranche of this capacity was also announced in December 2023, with 11 projects totalling 0.125GW of capacity being announced in the first hydrogen allocation round (HAR1) at a strike price of £175/MWh (in 2012 prices) or about £244/MWh in 2024 money. By way of comparison, today’s elevated gas price is ~99p/therm or £34/MWh. Green hydrogen will cost about seven times the current UK gas price or ~23 times US gas prices. The Government gleefully announced that these projects would receive over £2bn of revenue support from the Hydrogen Production Business Model (HPBM). The 125MW of contracts awarded in HAR1 is only the tip of the iceberg though because HAR2 is aiming to support seven times that with 875MW of capacity under consideration.

In 2023, then energy secretary Grant Shapps appeared to rule out paying for this very expensive hydrogen though energy bills. But now, the new Government, with Ed Miliband at the helm of DESNZ has launched a consultation on what they term the Gas Shipper Obligation (GSO) to fund the HPBM.

Cost of Gas Shipper Obligation

The Government estimates the cost of HAR1 projects funded by the GSO will add £2.60-£4.50 per annum to domestic gas bills from 2028 to 2037. Industrial gas users can expect their gas bills to go up by 2%.

If we scale this up to cover the ambitions of HAR2 as well, then that could add £20.80-£36 to our gas bills and 16% to that of industrial users. If they are mad enough to deliver the whole 6GW of green hydrogen, then the cost to domestic consumers could be a whopping £124.8-£216 per year and industrial users could see their gas costs almost double.

Of course, there will be a complex system put in place to manage this new charge with attendant administrator which will also increase costs and complexity.

Are There Exemptions to the Charge?

In the consultation, the Government raises the prospect of exemptions from the GSO charge, but it is clearly unwilling to grant exemptions for some users because then the charge will have to be spread over fewer users pushing up bills for those people even further. The only exemption they appear to be keen on is for gas used to produce blue hydrogen. They are concerned that pushing up the cost of the feedstock for blue hydrogen will make it uncompetitive.

This means that costs for gas-fired electricity generation will go up too, pushing up our electricity bills as well as our gas bills. Interestingly, they do not discuss the possibility of an exemption for gas-fired electricity with carbon capture and storage (CCUS), so even that form of electricity will cost more too.

Why Are They Doing This?

The introduction to the consultation reads as though it was written by an Extinction Rebellion activist and probably was because one of Miliband’s SPADs was once the coordinator of their legal strategy team. They wax lyrical about fixing the non-existent climate and nature crisis and what a huge opportunity it is to transition to a low-carbon energy system. They even claim to be tackling the cost-of-living crisis, even though the consultation admits that these proposals will increase our energy bills.

We can perhaps look at the latest missive from the Climate Change Committee to get closer to the truth. As Figure 1 shows, they want to reduce the ratio of electricity to gas prices. They can do this by pushing up the price of gas and of course this proposal does exactly that.

Figure 1 – CCC Forecast of Ratio of Electricity to Gas Prices

However, there are lots of reasons not to do this, not least the collapse of many green hydrogen projects across the world. For instance, the Aurora Green Hydrogen project in Norway was terminated in 2022, citing lack of demand. McPhy’s green hydrogen project in Central Europe was abandoned just seven days after it was announced after the customer withdrew last autumn. Earlier this month, BP withdrew from the HyGreen project as part of its strategic repositioning. Hygreen was supposed to deliver a 500MW plant on Teesside when fully operational. Interestingly, BP’s 1.2GW H2Teesside blue hydrogen project appears to be still going ahead.

In addition, the CCC ruled out hydrogen for home heating and surface transport in its latest Carbon Budget. They also see only a very small role for hydrogen in electricity generation in line with the NESO Clean Power 2030 plan. Industry is not going to volunteer to use hydrogen when there are much cheaper alternatives. It seems the Government expects the market for this extremely expensive hydrogen to bootstrap itself into existence.

Conclusions

We already have the highest electricity prices in the developed world and UK and European gas prices are many times higher than those in the US and Canada. We simply cannot afford any more whacky projects that push up energy costs even more. In fact, we should be going in the opposite direction and declaring an energy emergency to bring energy costs down.

The green hydrogen market is collapsing, because nobody wants to use such expensive fuel when natural gas is a much cheaper source of heat or electricity. Yet our Government is still pressing on with its ideological Soviet-style five-year target for a product with no market and wants us to pay for it.

We cannot afford such flights of fancy and need to change course on energy policy now. The focus should be on cheap and abundant energy to save what remains of our industry from total destruction and give relief to families struggling with energy bills.

[Update 2nd April 2025]:

Now the Government is seeking advice on how to subsidise using green or blue hydrogen to make electricity, further increasing our energy bills. [/Update]

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The Myth of a Hydrogen Economy

S.L. Cressey’s No Son, There Won’t Be a Hydrogen Economy is a sharp, data-driven critique of the growing hype surrounding hydrogen as a future energy source. The central argument of the book is clear and unwavering: while hydrogen may have limited industrial and aerospace applications, the broader vision of a global “hydrogen economy” is fundamentally flawed—technically, economically, and especially environmentally.

From Master Resource

By Administrator

“Scientists, engineers, and policymakers must reject symbolic solutions and focus on measurable, scalable, and scientifically robust strategies. Not all gases are equally dangerous, and not all solutions are equally wise.”

S.L. Cressey’s No Son, There Won’t Be a Hydrogen Economy is a sharp, data-driven critique of the growing hype surrounding hydrogen as a future energy source. The central argument of the book is clear and unwavering: while hydrogen may have limited industrial and aerospace applications, the broader vision of a global “hydrogen economy” is fundamentally flawed—technically, economically, and especially environmentally.

The hydrogen movement, in short, can be likened to “cargo cult science”—a term popularized by physicist Richard Feynman to describe efforts that mimic the appearance of scientific rigor without engaging with its foundational principles.

The book dispels the prospects of hydrogen as a miracle climate solution. While hydrogen combustion or fuel cell use does not emit carbon dioxide (CO₂), hydrogen itself is not a primary energy source but an energy carrier. It must be produced using other forms of energy, typically through steam methane reforming (SMR) or electrolysis. Both methods are energy-intensive and often powered by fossil fuels.

Fugitive Emissions

Electrolysis, even when powered by renewables or nuclear energy, demands large quantities of electricity and pure water, and suffers from inefficiencies that undermine its climate benefits. But the most critical flaw lies not in the production pathway—but in what happens when hydrogen escapes.

Technically, hydrogen is incredibly difficult to contain. As the smallest and lightest molecule in the universe, it effortlessly leaks through seals, valves, and pipelines. These “fugitive emissions” are not rare accidents—they are a systemic feature of large-scale hydrogen handling where hydrogen is lost across production, compression, storage, transport, and end use. And once in the atmosphere, leaked hydrogen does not remain inert or harmless—it becomes an invisible climate threat.

Environmentally, this is where hydrogen’s dangers are most under appreciated. Fugitive hydrogen emissions disrupt atmospheric chemistry in a way that amplifies global warming. Specifically, hydrogen reacts with hydroxyl radicals (OH) in the atmosphere—the same radicals responsible for breaking down methane, a potent greenhouse gas. When atmospheric OH is depleted by hydrogen, methane lingers longer, increasing its warming impact. Hydrogen also indirectly contributes to the formation of ground-level ozone and stratospheric water vapor, both of which are significant climate forcers.

Implications

Recent studies have shown that hydrogen can have a global warming potential (GWP) up to 33 times greater than CO₂ over a 20-year timeframe when accounting for these indirect effects. Thus No Son, There Won’t Be a Hydrogen Economy leads to a controversial but scientifically grounded point: carbon dioxide, despite its demonization, is far better understood and less disruptive than hydrogen in key respects. While excessive CO₂ contributes to long-term warming, it does not deplete hydroxyl radicals, and it does not unpredictably alter the lifetimes of more potent greenhouse gases.

This book also documents that atmospheric CO₂ has positive externalities. Increased CO₂ levels have been shown to enhance plant growth through the well-documented CO₂ fertilization effect. This can improve agricultural yields, promote reforestation, and expand the carbon sink capacity of the biosphere—particularly in arid and semi-arid regions. While these benefits do not necessarily justify unregulated emissions, they underscore the importance of weighing the net climatic and ecological impact of all gases—rather than simplifying climate policy into binary categories of “clean” and “dirty.”

By contrast, hydrogen offers no such ecological upside. Its fugitive emissions introduce non-linear, hard-to-model disturbances into atmospheric chemistry, contributing to warming via complex and poorly understood feedback loops. This makes the widespread use of hydrogen not just inefficient, but counterproductive.

Replacing one kilogram of natural gas with hydrogen—if it results in even modest leakage—can lead to higher net greenhouse emissions, not lower. Hydrogen’s environmental profile is especially dangerous because it escapes detection so easily and lacks regulatory oversight in many countries. Once released, it cannot be easily recaptured or offset, and its impact on the atmosphere can persist long after the initial emission.

Cressey devotes significant attention to the economic impracticalities as well. Green hydrogen currently costs between $4 and $7 per kilogram, far more than the gasoline-equivalent cost of natural gas. Transitioning existing infrastructure—homes, pipelines, industrial boilers, vehicles—to run on hydrogen would require trillions of dollars in retrofits and upgrades. He cites figures such as $4 trillion just to replace U.S. natural gas pipelines, and another $3 trillion to retrofit appliances. Despite these immense investments, hydrogen’s actual contribution to the energy mix remains negligible.

Real-world hydrogen demonstration projects—like China’s Kuqa facility, France’s Jupiter 1000, and the U.S. HECA plant—are examined with a critical lens. These cases often feature a pattern of high expectations followed by cost overruns, technical malfunctions, underperformance, and ultimately public subsidies to keep them afloat. Electrolyzers frequently cannot handle variable power inputs, fugitive leaks occur regularly, and promised carbon reductions fail to materialize. Cressey argues that the true climate benefit of these projects, once adjusted for leakage and inefficiencies, is negative or marginal at best.

Cressey’s overarching message is that hydrogen’s appeal is largely aesthetic and ideological. It has become a kind of symbolic fuel—clean at the point of use, futuristic in branding, and politically attractive. But when examined through the lens of chemistry and atmospheric science, it reveals itself to be deeply problematic. The hydrogen economy is not just an expensive detour—it may actively worsen the very problem it claims to solve.

Conclusion

There are other problems with hydrogen, including embrittling metals over time. Summed, the enthusiasm for hydrogen does not pass economic or environmental muster. The “clean fuel” narrative collapses under scrutiny—especially once fugitive emissions, atmospheric feedbacks, and the overlooked externalities of CO₂ are fully considered.

No Son, There Won’t Be a Hydrogen Economy calls on scientists, engineers, and policymakers to reject symbolic solutions and refocus on strategies grounded in measurable, scalable, and scientifically robust approaches. In doing so, the conversation goes from hype to hard evidence. Not all gases are equally dangerous, and not all solutions are equally wise.

Hydrogen Energy: Not Clean, Green, Cheap

Hydrogen. The first element in the Periodic Table and the most abundant element in the Universe. It is also the simplest element—the most common isotope has only one proton and one electron. It has been called the “Future of Energy”; after all, the Sun relies on hydrogen to keep emitting light and, if it is good enough for our Sun, why isn’t it good enough for us?

From Master Resource

By David R. Legates

“Hydrogen energy will cease to become viable when the subsidies provided to it by governments of the world dry up. Hopefully, the new Administration will recognize that hydrogen embrittlement applies not just to metals, but to our economy as well.”

Hydrogen. The first element in the Periodic Table and the most abundant element in the Universe. It is also the simplest element—the most common isotope has only one proton and one electron. It has been called the “Future of Energy”; after all, the Sun relies on hydrogen to keep emitting light and, if it is good enough for our Sun, why isn’t it good enough for us?

No doubt you have heard all the clamor associated with a hydrogen-based energy economy. Jeremy Rifkin published a book entitled The Hydrogen Economy: The Creation of the Worldwide Energy Web and the Redistribution of Power on Earth. He claimed that “globalization represents the end stage of the fossil-fuel era” and that turning “toward hydrogen is a promissory note for a safer world.”

In his State of the Union Address, the President stated that “with a new national commitment, our scientists and engineers will overcome obstacles” to taking hydrogen-fueled automobiles “from laboratory to showroom so that the first car driven by a child born today could be powered by hydrogen, and pollution-free.” The Administration then announced a collaborative effort with the European Union to develop a hydrogen economy, including the technologies “needed for mass production of safe and affordable hydrogen-powered fuel cell vehicles,” and stated that this would “improve America’s energy security by significantly reducing the need for imported oil.”

The Chicago Sun-Times ran a story that proclaimed, “The first steps toward what proponents call the hydrogen economy are [now] being taken.” And the US House of Representatives held the first of two “investigative hearings on the subject of hydrogen—its production, utilization, and potential effects on our energy economy of the future.” The chairman of the hearing claimed hydrogen “has the potential of playing the same kind of role in our energy system as electricity does today.”

Thus, hydrogen is poised to be the silver bullet that solves the climate crisis and removes us from a fossil fuel-based energy supply.

But wait. You don’t remember all of this? Well, the Rifkin book was published in 2002. The Administration was not the second Trump Presidency, the Joe Biden Presidency, the first Trump Presidency, or the first or second Obama Presidency. It was George W. Bush’s State of the Union in 2003. The Chicago Sun-Times article came out in 1996. And the Congressional Hearing? Well, that was held on June 10, 1975.

But doesn’t the Sun run on hydrogen? Yes, but not in the same way. In the Sun, through fusion, hydrogen atoms are merged to produce helium with lots of energy given off in the process. Each second, about six-hundred-billion kilograms of hydrogen are fused into helium and about four-billion kilograms of matter are converted to energy. On Earth, that process of fusion is about twenty years off and, as the meme goes, always will be. And apparently, so too will hydrogen as a fuel source.

How Do We Get Hydrogen?

Is mining or drilling for hydrogen the problem? No. That isn’t how we get hydrogen.

Hydrogen is produced by separating it from other elements in various compounds. The most common methods are electrolysis—where water is split to form hydrogen and oxygen gases—and steam-methane reforming, where hydrogen atoms are separated from the carbon atoms in methane. The former is generally how hydrogen is produced in high school chemistry classes but has recently been touted as the only “clean” way to produce hydrogen; the latter is the process by which hydrogen currently is produced commercially in the United States.

But steam-methane reforming requires high temperatures (about thirteen hundred to eighteen-hundred degrees Fahrenheit) and high pressures (between three and twenty-five times that of atmospheric pressure). This allows engineers to use steam as a catalyst to produce hydrogen, carbon monoxide, and carbon dioxide. Thus, the production of hydrogen through steam-methane reforming uses methane, a fossil fuel, and generates carbon dioxide (the supposedly evil gas) and carbon monoxide (a truly deadly gas).

But there is something interesting about the laws of physics. Namely, there is no free lunch. We often talk about the Second Law of Thermodynamics and that a system becomes more disordered with time unless energy is added to it from outside. We say the entropy of the closed system increases over time. But there are other ways of saying this. For example, we can say one cannot create a heat engine which extracts heat and converts all of it to useful work. Interpreting this for our discussion, the energy contained in the steam and methane cannot be entirely transferred to the hydrogen—some of it goes to the production of carbon dioxide and carbon monoxide and some is lost as heat.

This means the production of hydrogen from methane results in less energy in the hydrogen molecules than existed in the original methane molecule. How much less?

The first hurdle of hydrogen energy is its energy deficit. To get enough hydrogen to produce two megawatts of energy, a total of three megawatts of electricity is required. This doesn’t include the loss of energy—or the intervention of the Second Law of Thermodynamics—in the production of this electricity from other sources. In the words of Robert Bryce, hydrogen energy is “insanely expensive, in energy terms, to manufacture.”

So, why aren’t we just sending these three megawatts of electricity down the power lines to heat and cool homes, cook food, and perform other tasks that make our lives better? Because hydrogen is supposedly a clean fuel source, even though the energy to extract it is usually produced by methane and yields our supposedly evil gas, carbon dioxide, as a byproduct. Moreover, hydrogen is green—not in the environmental sense, but rather, subsidies abound for companies that wish to pursue the hydrogen panacea.

Storage Problems

The second hurdle associated with hydrogen as an energy source is that it is hard to handle and difficult to store. Hydrogen gas does not play well with metals and something called “hydrogen embrittlement” occurs. As the name implies, hydrogen embrittlement causes metals to become brittle and crack over time, especially when the metal is stressed. Being a small molecule, hydrogen easily escapes from the smallest of cracks. In general, hydrogen embrittlement does not occur at temperatures above about three-hundred degrees Fahrenheit; however, it is not feasible to heat pipes and storage tanks to this temperature. At ambient temperatures and pressures found on Earth, hydrogen embrittlement is a significant problem for many metals, such as steel, iron, nickel, titanium, cobalt, copper, and aluminum, plus alloys that contain them.

Proponents argue that hydrogen can be stored as a liquid. While true, that would require compression to seven-hundred times atmospheric pressure and refrigeration to minus-four-hundred-twenty-three degrees Fahrenheit. And, of course, even more energy would be required to reach and maintain that level of compression and cooling.

If we cannot transport and store hydrogen in existing trucks, tanks, and pipes, how is hydrogen best used as an energy source? It can be blended with natural gas and consumed by turbines and reciprocating engines. But that involves two disadvantages. One is that we lose energy by storing it in the production of hydrogen—why not simply use the methane in the turbine rather than wasting energy by converting it to hydrogen? There is simply no advantage to that, and it costs us energy. The second is that by mixing in methane, activists are no longer able to tout the hydrogen source as “clean and green renewable energy,” because methane is still in the mixture. Sigh. Virtue signaling rears its ugly head again.

The best way to use hydrogen is probably as the fuel source in a fuel cell. But fuel cells already run on methane, and the loss of energy in converting methane to hydrogen precludes any utility that the use of hydrogen would provide. Except, of course, that activists and those in the hydrogen-production industry would not be able to tout their fuel cell as being “clean and green renewable energy.” In my home state of Delaware, however, the state legislature has declared that methane consumed by a Bloom Energy fuel cell is renewable energy. Ah, the all-powerful legislature that can simply alter physics by majority vote!

Dangers in Use

A third hurdle with using hydrogen as a fuel source is that it is dangerous to use. Like methane, it is colorless and odorless, and no doubt, for hydrogen to become a widely used fuel source, it would have to be mixed with a smelly gas—just as smelly mercaptan is mixed with methane so a leak can be detected. And, yes, hydrogen is highly explosive.

It is why the early twentieth-century dirigible fleet in the United States was built using helium for buoyancy, not hydrogen, even though helium is more expensive to produce and provides less buoyancy. If you don’t understand the explosive potential of hydrogen, the Hindenburg disaster should tell you all you need to know.

Not Cheap

Finally, the fourth hurdle should now be obvious. The use of hydrogen as a fuel source is expensive—in terms of production cost, expensive storage, and energy required to produce. Hydrogen as a fuel source will allow virtue signalers to claim they have developed and are using a “clean and green” fuel source that is “saving the planet from the evils of fossil fuels.” But in reality, it is only going to make energy more expensive and send a larger proportion of the planet back below the poverty line.

As we have often stated here at the Cornwall Alliance, inexpensive energy has been the solution to raising billions of people above the poverty line and increasing their standard of living. Hydrogen energy will cease to become viable when the subsidies provided to it by governments of the world dry up. Hopefully, the new Administration will recognize that hydrogen embrittlement applies not just to metals, but to our economy as well.

——————————-

David R. Legates, PhD, is Director of Research and Education for the Cornwall Alliance for the Stewardship of Creation and retired professor of climatology at the University of Delaware. He is the co-editor of Climate and Energy: The Case for Realism.

Green Hydrogen Needs Vast Subsidies

Hydrogen is not a fuel. Hydrogen must be created; it must be made from another energy source, just as electricity must be made from other energy. Global hydrogen trade may be just a pipe dream.

From  Master Resource

By Steve Goreham

“Hydrogen from electrolysis, called green hydrogen, typically costs more than $5 per kilogram, or more than five times the price when produced from natural gas.”

“The U.S. Inflation Reduction Act offers an astounding subsidy of $3 to produce a kilogram of green hydrogen, three times the market price. Imagine a subsidy of $150,000 to purchase a $50,000 electric car or a subsidy of $12 to produce a $4 gallon of gasoline. There appears to be no end to the cash governments will pay to try to establish a hydrogen economy.”

World leaders tout “green hydrogen” as an essential fuel in the renewable energy transition. Today, heavy industries use huge amounts of coal and natural gas to produce products needed by society. Governments propose to replace hydrocarbon fuels with hydrogen fuel, using hundreds of billions of dollars in subsidies. But vast subsidies won’t be enough to overcome the insurmountable problems with green hydrogen fuel.

Four big industries—ammonia, cement, plastics, and steel—are powered by natural gas and coal, also called hydrocarbon fuels, while emitting large amounts of carbon dioxide (CO2). The world’s ammonia industry produced almost 200 million tons of ammonia in 2020, primarily for agricultural fertilizer, using natural gas and coal as fuel and feedstock. About 4.3 billion tons of cement, the essential material for concrete, were output that same year, while exhausting CO2 and burning hydrocarbons in furnaces. Over 300 million tons of plastic are produced each year using gas for feedstock and fuel. Annually, 1.9 billion tons of steel are produced using coal and gas.

To reduce CO2 emissions, world leaders call for heavy industry to switch from natural gas and coal to hydrogen fuel. When hydrogen burns, the only combustion product is water vapor.

Most hydrogen in nature exists in compounds, such as water (H2O) or methane (CH4). But hydrogen is not expensive. When produced from hydrocarbons, it costs only about a dollar a kilogram. About 99 percent of the world’s 70 million tons of annual hydrogen production comes from gas, using steam methane reforming, or from coal, using coal gasification. But advocates propose to produce green hydrogen from electrolysis of water, using electricity from wind, solar, and other renewable sources.

Electrolysis uses electricity to decompose water into hydrogen and oxygen gas. Industrial electrolyzers use complex cell structures, catalysts, and electrolytes to maximize efficiency and reduce cost. But few electrolyzers operate today because the hydrogen they produce is very expensive. Hydrogen from electrolysis, called green hydrogen, typically costs more than $5 per kilogram, or more than five times the price when produced from natural gas.

Electrolysis is expensive because it uses huge amounts of electricity. Production of one kilogram of hydrogen from electrolysis requires about 50─55 kilowatt-hours (kWh) of electricity, or almost double the daily power consumed by a US home. In 2022, the industrial price of electricity was about six cents per kWh in the United States and about 12 cents per kWh in Germany. To produce a kilogram of hydrogen, the electricity alone costs about $3 in the US and $6 in Germany, or three and six times the price of hydrogen produced by natural gas.

Nations plan to pour vast amounts of subsidy money into hydrogen production to try to overcome the cost problem. This month President Biden announced $7 billion in subsidies for regional hydrogen hubs to try to rein in climate change. Announced hydrogen subsidies have passed $280 billion globally, with the U.S. expected to provide $137 billion over the next ten years.

The U.S. Inflation Reduction Act offers an astounding subsidy of $3 to produce a kilogram of green hydrogen, three times the market price. Imagine a subsidy of $150,000 to purchase a $50,000 electric car or a subsidy of $12 to produce a $4 gallon of gasoline. There appears to be no end to the cash governments will pay to try to establish a hydrogen economy.

Most hydrogen produced today from gas or coal is used on site to produce ammonia to make synthetic nitrogen fertilizer. There are no regional markets for hydrogen because hydrogen is very difficult to transport. Transportation adds additional costs to the already exorbitant price of green hydrogen.

Advocates propose that gas pipelines be used to transport hydrogen. But hydrogen is very reactive and degrades metal by a process known as hydrogen embrittlement. Embrittlement can cause cracks, leaks, and even explosions in metal pipelines. The US National Renewable Energy Laboratory recommends that pipeline blends be less than 20 percent hydrogen to minimize embrittlement.

Transporting hydrogen by ship is also costly. Liquefaction of hydrogen to -253oC requires energy equal to about 25─35 percent of the hydrogen itself, compared to the 10 percent needed to liquify natural gas. Hydrogen can be transported in the form of ammonia, which liquifies at 35oC, but must then be converted back to hydrogen, requiring energy equal to up to 30 percent of the energy content of hydrogen itself.

For hydrogen to be green, electrolyzers must use electricity from renewable or nuclear sources. But most electricity still comes from coal, oil, and natural gas, including 61% of US power in 2021, and most of the power in China (66%), India (78%), and Japan (65%). Only 37 percent of Europe’s electricity comes from hydrocarbons, but today Europe hardly has enough electricity to keep the lights on, and little to spare for electrolysis.

Converting industry to use green hydrogen fuel would require vast amounts of renewable electricity. For example, the average European steel plant produces about four million tons of crude steel per year. Hydrogen Europe, a hydrogen advocacy group, estimates that running one average plant on hydrogen would require about five GW of solar-array capacity to drive the electrolyzers. This is more than 13 times the output of California’s Ivanpah solar facility.

A solar facility that could generate this much electricity would cover more than 70 square miles. To convert the world’s steel industry to run on green hydrogen, over 5,000 TWh of electricity from renewables would be needed to drive electrolyzers. This is more than the world’s total output of renewable electricity today.

Alternatively, to power electrolyzers for the steel industry, the world would need to build 600 nuclear plants, added to the 437 nuclear plants operating today. This isn’t going to happen. There won’t be enough renewables to produce green hydrogen for heavy industry.

Advocates appear to believe that a landslide of money can create a new green fuel industry. But a hydrogen fuel industry, if created, will be small and based entirely on government subsidies, not sound economics.

——————

Steve Goreham is a speaker on energy, the environment, and public policy and the author of the new bestseller, Green Breakdown: The Coming Renewable Energy Failure. His posts at MasterResource can be viewed here.

Tesla’s Entry into The Net Zero Game: “Sustainable Energy for All of Earth”

One of the core subjects of this site for several years has been doing reality checks on the schemes of Net Zero central planners.

From Manhattan Contrarian

By Francis Menton

One of the core subjects of this site for several years has been doing reality checks on the schemes of Net Zero central planners. Is there any chance that these zero carbon economy schemes might work? Or are they just dreams that ignore obvious physical obstacles in a religious zeal to reach an imagined future utopia?

My prior writings on this subject are summarized in my December 2022 Report “The Energy Storage Conundrum,” and in my recent posts (here and here) on the work of Bill Ponton regarding the UK.

On April 5 Tesla dropped into the debate a big Report of their own, with the title “Sustainable Energy for All of Earth.” Tesla reaches the exact opposite conclusion from me and the people I have cited in my writings on this subject. From the Executive Summary:

This paper finds a sustainable energy economy is technically feasible and requires less investment and less material extraction than continuing today’s unsustainable energy economy. While many prior studies have come to a similar conclusion, this study seeks to push the thinking forward related to material intensity, manufacturing capacity, and manufacturing investment required for a transition across all energy sectors worldwide.

Could that be? After all, this Tesla Report is clearly backed by many millions of dollars of funding, with dozens of smart and highly-paid people beavering away for months or even years on sophisticated computer models to come up with impressive results. By contrast, the people on whose work I have relied — Roger Andrews, Ken Gregory, Bill Ponton — as well as myself, are all unpaid volunteers working on our own and with no resources other than the internet and perhaps an Excel spreadsheet program.

Before getting into some specifics, I should mention that I have a good deal of admiration for Tesla’s CEO, Elon Musk. He is a bona fide creative business genius. However, let’s not lose track of the fact that all of his main pre-Twitter businesses — electric vehicles, batteries, solar panels, space launches — are almost entirely if not entirely dependent for their revenue on the gaming of government subsidy and handout programs. The electric vehicle business, in particular, that underlies the lion’s share of Musk’s net worth, has a valuation that can only be justified by a faith that essentially all vehicles will soon be electrified. So far, the market share of EVs has been almost entirely dependent on a combination of government subsidies and compulsion (e.g., “fuel economy” standards that exempt EVs). If EVs don’t take over the auto market, then Musk may be no wealthier than you or I come 2030. I suggest keeping that in mind when considering the Tesla “Sustainable Energy” Report.

There is a huge amount of detail here, and I only have time for so much. But let’s take a look at how this Report proposes to deal with the energy storage for the U.S. Recall that Ken Gregory calculated that if the U.S. fully converted to wind and solar generation, it would need to store approximately 250,000 GWh (which would be 250 TWh) to make it through a full annual storage and discharge cycle, given the seasonal pattern of wind and solar generation. Try to provide the 250 TWh of storage with lithium ion batteries at $200/KWh, and that will run you about $50 trillion. That would be slightly unaffordable, given current U.S. annual GDP of under $25 trillion.

Here is the chart from the Tesla Report on how they propose to deal with storage for the U.S.:

As you can see, their answer is almost entire hydrogen. The total storage proposed, at 120 TWh, is less than half of what Gregory calculated as needed, but not wildly out of range.

In Tesla’s favor, the idea of using hydrogen for the storage is substantially less insane than relying mostly on batteries. But, as discussed in my energy storage Report, hydrogen produced by electrolysis from water using electricity only from renewables is far from cheap. For my Report, I found a figure of $4-6/kg for producing this “green” hydrogen, which translates to a price of $32 – 48/MMBTUs (the units in which natural gas prices are typically quoted). By contrast, natural gas prices fluctuate, but over the last ten years they have always been under $10/MMBTU, and mostly around $3-5/MMBTU. The current price is more like $2/MMBTU. The Tesla Report cites a price of about $3/kg ($24/MMBTU) just to store the hydrogen on an annual basis.

As also discussed in my energy storage Report, hydrogen is more challenging to deal with than natural gas in every respect. It is less energy dense (meaning, more pipeline capacity needed to transport the same amount of energy), it embrittles steel pipes, it is more explosive and dangerous, it is more prone to leaks, and so forth. To move to hydrogen as the vehicle of energy storage would mean creating an entire national infrastructure of new facilities. Next to none of that currently exists, nor is it under construction or even in the planning stage. I can’t find any effort in the Tesla Report to estimate a cost for any of this.

And private investment will not build it. Why? For the simple reason that natural gas is cheaper and better in every respect. Nobody is going to buy green hydrogen at $40/MMBTU when natural gas can be had for $5, and nobody is going to build the infrastructure to transport and store hydrogen until it is price competitive to do so.

So natural gas can say all they want that their zero carbon energy system “requires less investment and less material extraction,” but the fact is that the market is saying otherwise. The whole “hydrogen economy” thing is completely dependent on a new economy of government central planning and handouts, and is sitting around waiting for the next round of hundreds of billions of dollars of government subsidies to get it going.

Without going into detail on other sections of the Tesla Report, I’ll just say that there are plenty of obvious fantasies. For example, how about air travel? No problem!:

Longer distance flights, estimated as 80% of air travel energy consumption (85B gallons/year of jet fuel globally), can be powered by synthetic fuels generated from excess renewable electricity leveraging the Fischer-Tropsch process, which uses a mixture of carbon monoxide (CO) and hydrogen (H2) to synthesize a wide variety of liquid hydrocarbons, and has been demonstrated as a viable pathway for synthetic jet fuel synthesis.

Just another minor item to be invented new from scratch.

Why would a Tesla put out a Report like this? It doesn’t take much thought to understand the reason. Getting the bureaucrats excited about their utopia coming to pass is the route to the mandates and subsidies for EVs and batteries for decades to come, all of which will maintain Musk as the world’s richest man. And if it all doesn’t work in the end? Somebody else’s problem.

So, Mr. Musk, if all this can be done for “less investment” than our current system, there should be real money to be made by building the demonstration project to show us all how it works. How about taking one of the smaller Hawaiian islands (Maui?), and installing the wind turbines, solar panels, hydrogen electrolyzers, and storage facilities to go 100% carbon free? The Hawaiians will all save money, and you’ll make additional billions. I hereby call your bluff. Put up, or shut up!