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Hydrogen is a clean alternative to methane, also known as natural gas. It’s the most abundant chemical element, estimated to contribute 75% of the mass of the universe. On earth, vast numbers of hydrogen atoms are contained in water, plants, animals and, of course, humans. But while it’s present in nearly all molecules in living things, it’s very scarce as a gas – less than one part per million by volume.
Hydrogen can be produced from a variety of resources, such as natural gas, nuclear power, biogas, and renewable power like solar and wind. The challenge is harnessing hydrogen as a gas on a large scale to fuel our homes and businesses. When natural gas is burnt, it provides heat energy. But a waste product alongside water is carbon dioxide, which when released into the atmosphere contributes to climate change. When we burn hydrogen instead, the only waste product is water vapor.
Hydrogen has been already used as a fuel. There are already cars that run on hydrogen fuel cells. In Japan there are 134 public hydrogen refueling stations, allowing you to fill up just as you would with petrol or diesel and in the same time frame as a traditional fuel car. Germany has over 90 of these hydrogen stations and the United States is third with 46 stations [Data from 2021].
Hydrogen is also an exciting lightweight fuel option for road, air and shipping transportation. The international delivery company DHL already has a fleet of more than 100 “H2 panel vans”, capable of travelling 500kms without refueling. Hence, hydrogen is in competition with electric vehicles, which Müncon also covers.
The compression storage technology segment accounted for dominant share of around 40% in 2019 owing to majority number of applications of compressed hydrogen across various sectors:
A) Stationary Power Generation
B) Hydrogen fuel stations
C) Hydrogen Vehicles
D) Road transportation
The liquefaction segment was valued at USD 3.8 billion in 2019. Storing hydrogen in liquid form has one major benefit of energy density when compared to the compression storage technology. Liquid tanks have increased energy density thereby storing more hydrogen in a given volume. However, the boil-off losses due to high energy requirement for liquifying hydrogen, impact the cost efficiency and safety of the storage technology.
Material based hydrogen storage technology is expected to witness a CAGR of 5.1% over the forecast period. The technology consisting of hydride storage systems, liquid hydrogen carriers, and surface storage systems, has a high volumetric storage density as compared to other storage technologies. For instance, palladium absorbs hydrogen gas with a volume that is approximately 1000 times its own volume.
The liquid segment was valued at USD 4.7 billion in 2019. The segment is expected to grow during the forecast period owing to liquid hydrogen witnessing demand in applications that require high purity levels of hydrogen, such as the chip industry. Even though liquid hydrogen has a higher energy density than its gaseous form, it involves an additional economic cost. Heavy insulation of the liquid tanks and required liquefaction at -253 degrees Celsius are expected to hamper segment growth by 2027.
Metal hydrides are the most feasible hydrogen storage materials, as they can be easily deployed in a variety of applications, such as heat pumps, thermal storages, or vehicles with short range (forklifts, public transportation, or smaller commercial vehicles). In terms of application, the hydrogen storage market includes stationary power, portable power, and transportation. The increasing demand for hydrogen for electricity generation is expected to propel the hydrogen storage market growth over the forecast time period.
The use of hydrogen as stationary power is extensively witnessed in hospitals, airports, retail stores, homes, grocery stores, telecommunications networks, businesses, and utilities. The transportation segment is predicted to be the fastest growing in the upcoming years, owing to the growing production of fuel cell automobiles and various advantages of hydrogen fuel cells to decrease greenhouse emissions.
At the beginning of 2021, over 30 countries released hydrogen roadmaps, the industry announced more than 200 hydrogen projects. More than USD 70 billion have been committed in public funding programs by governments. This momentum exists along the entire value chain of the hydrogen industry, accelerating cost reductions and technological development for hydrogen production, transmission, distribution, retail and end applications. Globally, 228 hydrogen projects have been announced to be developed between 2021 and 2030, of which 17 are giga-scale green hydrogen projects.
Out of 200 hydrogen projects, 85% are originated in Europe, Asia, Australia, North and Latin America, the Middle East as well as in Africa. Looking at the total investments of all 200 projects over USD 300 billion are spend for hydrogen projects through 2030 – the equivalent of 1.4% of the global energy funding with an upward trend.
Many European countries have been invested in finding non-carbon intensive alternatives for industrial and transportation usage in line with the European Union’s Green Deal and an effort to strengthen the local value chain. Europe is followed by Asia with 46 and Oceania with 24 projects. Out of the mentioned USD 300 billion only USD 80 billion can currently be considered as an investment which is either in a planning stage, has passed a final investment decision or is associated with a project under construction.
Analysing the global hydrogen company market 363 companies with main key activity in producing, processing, or servicing hydrogen could be found in June 2021. There exist far more companies offering hydrogen services (another 1056 companies), but with their main business activities in various industry sectors like automotive, aviation, chemistry, logistics, steel, or power. The accumulation of these 363 identified hydrogen companies takes place especially in Germany and USA. Over 80% of these companies find themselves still in an early growing phase. Therefore, information about revenue and number of employees are difficult to identify. About 98% of these 363 companies offer B2B, only 2% offer B2C services.
The global demand for hydrogen is expected to nearly double between 2017 and 2050. The carbon mitigation potential of using hydrogen fuel in the place of other fuels is estimated to be almost 110 metric tons of carbon dioxide equivalent on a yearly basis by 2050, when the hydrogen is produced using methane pyrolysis. Following growing efforts to keep global warming to a minimum of +2 degrees Celsius, hydrogen demand is expected to increase to 78 exajoules worldwide by 2050.
Today, most hydrogen is won by steam reforming methane in natural gas and is thus considered a fossil fuel. However, green hydrogen produced from renewable electrolysis is set to become cheaper and more widely available in the near future, which would make it an important zero-emission energy and transport fuel source. Looking at the demand share for hydrogen by end users, the transportation sector is expected to become the greatest by 2050 with 29%. The transportation sector will be followed by the industry energy with 21%, building heating and power with 14% and existing feedstock uses with 13%.
In 2019 the gas segment accounted for nearly 75% of the global hydrogen energy storage market share and is expected to dominate by the end of 2027, spurred by huge demand from the transport sector and low storage cost of compressed hydrogen. Asia-Pacific held the major share in 2019, generating nearly half of the global hydrogen energy storage market. The emerging economies in Asia-Pacific are adopting various foreign equipment, thereby improving production efficiency. Compared to Asia, Europe and North America, the LAMEA region countries (Latin America, Middle East and Africa) would generate the fastest CAGR of 8.60% until 2027, due to the increase in trade fairs and exhibitions that are promoting new technologies, the report predicts.
Further declining cost of renewable power generation from solar and wind energy is anticipated to boost the market for hydrogen energy storage within the next years. According to the International Renewable Energy Agency (IRENA), for renewable hydrogen to be competitive with fossil fuel produced hydrogen, it should be generated at less than USD 2.5 per kg. The price depends on several factors such as production location, market segment, renewable energy power tariffs, investments in future electrolysers and transportation costs. Self-explanatory low hydrogen production prices will lead to higher deployment of its energy storage systems.