Potential of Green Hydrogen To Drive Energy Transition Beyond Transport Sector

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Potential of green hydrogen to drive energy transition

beyond transport sector

Presenters:
• Emanuele Taibi, Power System Transformation Strategies, IRENA
• Raul Miranda, Associate Analyst, Energy Systems Modelling, IRENA

TUESDAY, 7 JULY 2020 • 15:00-15:30 CEST


SPEAKERS

Emanuele Taibi Raul Miranda


Power System Associate Analyst,
Transformation Energy Systems
Strategies, IRENA Modelling, IRENA
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IRENA’s work on Green Hydrogen

Knowledge 2018

• Hydrogen from renewable power: Technology outlook for the energy transition
(2018)
• Hydrogen: A renewable energy perspective (2019)
2019
• Reaching Zero with Renewables (forthcoming in Q3 2020)
• Technology Brief: Electrolyser Technologies (forthcoming in Q4 2020)
2020
Outreach
• Session on “Electrification of Fuels: Hydrogen” at IRENA Innovation Week (2018)
Collaborative
• Thematic meeting “Decarbonizing complex sectors” at 18th Council (2019) Framework on
Green Hydrogen
• Ministerial Roundtable on Green Hydrogen at 10th Assembly (January 2020)
• First meeting of the Collaborative Framework on Green Hydrogen (June 2020)
Technology Brief
Electrolyser
Technologies
Decarbonisation
Hydrogen in the energy transition Deep Decarbonisation

Decarbonising Transport
✓ FCEVs: performances of conventional
vehicles
✓ FCEVs are complementary to BEVs in
decarbonising road transport
✓ FC/E-fuels for rail, aviation, maritime
sector (deep decarbonization)
Source: IRENA (2018)

Decarbonising the gas grid


Decarbonising Industry
✓ Take advantage of low electricity prices
✓ Replace fossil-fuel produced hydrogen
✓ Provide seasonal storage for solar and wind
✓ Replace fossil-fuel based feedstocks
✓ Provide grid services from electrolysers
✓ New commodities e.g. iron pellets (DRI)
✓ Distributed stationary fuel-cell for heat and power
generation
Hydrogen: A key part of future Energy Systems
Hydrogen’s role
• Solution for end-uses that are hard to directly
electrify. Emission reduction (GRO 2050):
• Green Hydrogen: 3%; Blue Hydrogen: 3% (PES)*
• Green Hydrogen: 7%, Blue Hydrogen: 1% (TES)**

• Increase the flexibility of power systems at all


timescales

Key Points in 2050 (TES)


• Hydrogen production costs: 0.9-2.0 USD/kg H2

• Electrolyser capacity: 1700 GW

• Electricity to produce green hydrogen: 7.5 PWh


* Reduction in Planned Energy Scenario (33 Gt in 2050) in relation to Baseline (43 Gt in 2050)
** Additional reduction in Transforming Energy Scenario (9.5 Gt in 2050)
• Solar and Wind capacity: at least 4 TW in relation to Planned Energy Scenario (33 Gt in 2050)
The role of green hydrogen in reaching zero emissions

6% of reduction
3% of reduction 1.4 Gt/yr
0.3 Gt/yr

14-23% of reduction
1.4-2.3 Gt/yr

8% of reduction
4.0 Gt/yr
Hydrogen production costs
Hydrogen from renewables has a great potential but electrolyser costs need to further decrease

Source: IRENA (2019)

Main assumptions about electrolysers: Load factor: 4200 hours (48%), conversion efficiency 65% (today), 75% (2050)
IRENA’s Technology Brief: Green Hydrogen Electrolysers
Key drivers: Electrolysers
• Renewable costs continue to fall
» Use electricity to split water into hydrogen and oxygen
• Systems integration challenges » Can provide demand-side flexibility by:
• Electrolyser projects rapidly growing in size and numbers » Adjusting hydrogen production to follow wind and solar
generation profiles in periods of high resource availability
• Electrolysers cost is projected to halve
» Store green electrons as green molecules
• Key solution to reaching zero emissions by 2060 » Provide grid balancing services

Main focus:
• Project cost and equipment cost trends
• Efficiency and lifetime
• Compressor and on-site storage linkages with operation
and capabilities to provide flexibility

• Additional revenues for electrolyser operators


• Potential of technological innovation
• Latest projects
Q3/Q4 2020
Electrolysers – the role of economies of scale in reducing hydrogen cost

Source: NREL (2020)


Hydrogen production costs:
renewable electricity, CAPEX of electrolysers and operating hours
Electricity price = 20/MWh CAPEX = 350 USD/kW
10 10
ELE Price: 100 USD/MWh ELE Price: 80 USD/MWh
9 CAPEX: 1000 USD/kW 9
ELE Price: 60 USD/MWh ELE Price: 40 USD/MWh

8 8 ELE Price: 20 USD/MWh ELE Price: 10 USD/MWh


CAPEX: 700 USD/kW

Hydrogen cost (USD/kg H2)


7 ELE Price: Zero
Hydrogen cost (USD/kg H2)

7 CAPEX: 550 USD/kW

6 6
CAPEX: 450 USD/kW
5 5
CAPEX: 350 USD/kW
4 4

3 3

2 2

1 1

0 0
0 1000 2000 3000 4000 5000 6000 7000 8000 0 1000 2000 3000 4000 5000 6000 7000 8000

Operating hours Operating hours

Hydrogen from renewables has a great potential but electrolyser costs need to further decrease

▪ Electrolyser CAPEX and electricity price as well as operating hours are the main parameters
determining the cost of producing Green Hydrogen
Power-to-hydrogen: Demand-side flexibility and grid services

Hydrogen for seasonal storage Provision of frequency containment reserve


• Significant storage needs in 2050 for VRE integration • Major pilot project recently met requirements for
participation in the German ancillary services market
• Power-to-gas electricity storage would be beneficial
and economically viable in a high-renewables scenario. • Full capacity within max. 30 seconds and ability
to maintain it for at least 15 minutes
• Compressed or liquefied (p.eg. dedicated gas grids,
geological structures), mixed with other elements or • Plant operators can market their ability to adapt
blended with natural gas in gas grids flexibly to electricity market prices and thus generate
additional revenues
• Energy stored in the European gas grid: 1 200 TWh.

Source: LBST (2019)


Ministerial Roundtable on Green Hydrogen

“Green hydrogen is gaining


“In addition to power sector, there
unprecedented political and business
are other sectors which are very
momentum, with the number of policies
important, iron and steel,
and projects expanding rapidly around
chemicals, and so on, and
the world,”
hydrogen can be very important
there to decarbonize those so- Francesco La Camera
called hard to abate sectors.” Director-General of IRENA
Fatih Birol
Executive-Director of IEA
“The first thing which I feel is
that costs of electrolyzers have to
come down.”
Claude Turmes, Minister of
Energy of Luxembourg
Collaborative Framework on Green Hydrogen
• Green Hydrogen Ministerial Roundtable at • Strategic direction from Members on the Framework:
IRENA’s 10th Assembly
• Establish a global knowledge database for green hydrogen
• Members called upon IRENA to continue its work
on hydrogen from renewable power • Strengthen collaboration with existing hydrogen initiatives and
• IRENA is establishing a Collaborative Framework other relevant stakeholders
on Green Hydrogen • Evaluate the nexus between hydrogen and renewables as well as
• A virtual meeting was held on 18 June 2020 to the flexibility from coupling power and hydrogen
discuss the modalities and scope of work
• Disseminate knowledge on transport and distribution of
hydrogen

• Disseminate and coordinate standards and regulatory


frameworks

• Sharing of best practices on hydrogen projects financing


Thank you!
Emanuele Taibi Raul Miranda
ETaibi@irena.org RMiranda@irena.org

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