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Green hydrogen costs predicted to fall
GLOBAL
HYDROGEN produced by green electricity could be cheaper than hydrogen produced by burning natural gas by 2030.
Green hydrogen, which is made by electroly- sis by using electricity to split water into hydro- gen and oxygen, is now being produced on a commercial scale more widely, with falling costs boosting development, according to new analy- ses from HIS Markit.
“Costs for producing green hydrogen have fallen 50% since 2015 and could be reduced by an additional 30% by 2025 due to the bene ts of increased scale and more standardized manufac- turing, among other factors,” said Simon Blakey, IHS Markit Senior Advisor, Global Gas.
Investment in so-called “power-to-x” pro- jects—of which hydrogen makes up the large majority—is growing rapidly. Investment is expected to grow from around $30mn in 2019 to more than $700mn in 2023.
Economies of scale are a primary driver for green hydrogen’s growing cost competitiveness. e average size for power-to-x projects sched- uled for 2023 is 100MW—ten times the capacity of the largest project in operation today—accord- ing to the IHS Markit Power-to-X Tracker, which tracks hydrogen projects around the world.
Hydrogen production that uses natural gas as a feedstock, via a process known as methane reforming, currently supplies the hydrogen to
the chemical and re ning industries that today make up the bulk of global hydrogen demand.
“There is growing potential for hydrogen to be used in transport, heating, industry and power generation,” said Shankari Srinivasan, Vice president, IHS Markit, Global and Renew- able Gas.
Both green hydrogen and so-called blue hydrogen—methane reforming coupled with carbon capture technology—are likely to play a role in the energy future as demand expands.
Hydrogen’s overall share in the energy mix will ultimately depend on the extent of decar- bonization that is desired, IHS Markit said.
In Europe, hydrogen could account for as much as one third of the energy mix if the aim was 95% decarbonization or greater.
“In Europe it is now widely agreed that elec- tri cation alone cannot deliver the level of emis- sions reduction that many countries aspire to,” said Catherine Robinson, IHS Markit Execu- tive Director, European Power, Hydrogen and Renewable Gas.
“Hydrogen is a highly versatile fuel—both in terms of how it can be transported and the variety of its potential end-use applications. e greater the degree of a decarbonization, the greater the likely role of hydrogen in the energy future.”™
SA urged to pursue renewables to meet Paris targets and avoid higher tariffs
SOUTH AFRICA
INCREASING investment in renewables will allow South Africa to meet power future demand, reduce emissions and meet its Paris Agreement commitments.
e falling global cost of renewables technol- ogy, from solar to wind to storage, means that replacing coal with renewables would also avoid any increase in power tari s for consumers.
at is the conclusion of a recent research report from South African think tank Meridian Economics and the Council for Scienti c and Industrial Research (CSIR).
The report found that it would cost ZAR500bn ($31bn) of capital investment by 2030 to fund an “accelerated renewable energy pathway.”
is compared with the current Integrated Resource Plan (IRP) spending of ZAR244bn ($14.7bn).
Boosting public and private investment in green energy would also stimulate the country’s post-pandemic economic recovery, the research found.
It also calls for localised manufacturing of renewable energy components, such as wind and solar turbines. is would create 50,000 jobs new jobs in the green energy industry.
e report found that: “Accelerated transition pathways, saving up to a third of IRP 2019 CO2 emissions, involve a substantial and immediate renewable energy build programme (at least double the IRP 2019 rate) which comes at no additional cost for consumers.”
e report concluded that: ”Signi cant cli- mate mitigation does not increase the cost of power, it potentially even reduces cost.”
The report found that South Africa could reduce emissions by 1-2 billion tonnes for
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