[ hydrogen blending ]
The demand for hydrogen is not confined to a single sector ; it extends to industries like steel , transportation , cement , heating , and agriculture . These sectors actively seek clean energy solutions , creating a strong market pull for hydrogen-based alternatives . Hydrogen blending – alongside other hydrogen applications such as fuel cellpowered vehicles for heavy transport , marine , and rail – plays a pivotal role in decarbonizing these emissions-intensive industries .
Investment and funding inflows Growing financial support from governments , investors and venture capitalists highlight the market ’ s confidence in hydrogen ’ s potential . In policies such as the U . S . Inflation Reduction Act , there are incentives for hydrogen production , distribution , and consumption , fostering a conducive environment for market growth and stability and an influx of investment on the private side . Collaborative partnerships are also forming between key industry players , research institutions and governments to address technical , regulatory , and market challenges – helping to align stakeholders and propel the industry forward .
The urgency for investment in hydrogen projects today is greater than ever , as shown by the rebound of carbon emissions to above pre-COVID levels and the supply chain issues caused by geopolitical tensions . However , Canada and the U . S . still need greater investments to be on track for net-zero emissions by 2050 . In both countries , we have seen the introduction of strong incentives for industries with high carbon emissions to transition to hydrogen-based solutions . This has been a driver of rapid decarbonization . Policies that reward emissions reduction through hydrogen adoption , such as incentives , tax credits and carbon pricing mechanisms , can stimulate demand and market growth . The Inflation Reduction Act is a great example of a policy glued to incentives .
Developing globally recognized standards and certifications for hydrogen production , storage , transportation , and utilization can enhance confidence in the industry ’ s safety , reliability , and interoperability . These standards can streamline regulatory processes , encourage investments , and ensure consistent application and quality across the hydrogen value chain . The number of dedicated research and development centers focused on hydrogen has also been progressing steadily .
Decreasing hydrogen production costs While low-carbon hydrogen cannot yet compete with traditional energy sources , significant cost reductions can be achieved through advancements in renewable energy sources , carbon capture and storage technologies , and economies of scale .
The overall cost of transitioning any natural gas delivery system , whether by blending hydrogen into existing pipelines or directly incorporating hydrogen into end-user applications , involves two main components : the capital investment and the cost of the delivered hydrogen . The capital investment includes the costs of blending equipment , pipeline modifications , and the evaluation and testing program to demonstrate safe and reliable use . To assess the cost-effectiveness of this transition , we need to compare the cost of hydrogen at the blending point to the cost of natural gas on an energy equivalence basis ( for example per million British thermal units – MMBtu ). Once this energy equivalence is established , any additional cost of hydrogen above this equivalence reflects the expense of reducing carbon emissions , measured in dollars per ton of CO2 removed .
Parameters affecting blending equipment capital costs include :
• Hydrogen storage ( either as cryogenic liquid or gaseous );
32 Hydrogen Tech World | Issue 15 | April 2024