Utility Week

UTILITY WEEK | 21ST - 27TH SEPTEMBER 2018 | 15 Finance & Investment Market view T he UK has made good progress on decarbonisation, but the bulk of this has come from the power-generation sector switching from coal to gas and, increasingly, renewables. Decarbonising heating and transport poses a trickier prob- lem, but it's one that hydrogen can help solve. Advantages over electricity What about electricity? All-electric heating would require vastly more power genera- tion capacity than there is today and huge amounts of energy storage to cope with sea- sonal variations in demand. Hydrogen, on the other hand, could be stored more easily, for example in under- ground caverns as is currently done with nat- ural gas. We could also use the existing gas distribution grid – up to a point. The propor- tion of hydrogen in the grid could increase to 20 per cent without modifying pipes or domestic appliances such as boilers. To go to 100 per cent hydrogen, appli- ances would have to be modified, but we've done it before when the country converted from town gas (a mixture of hydrogen and carbon dioxide) to natural gas. When it comes to transport, electric cars might be ideal for short journeys but battery-powered vehicles will struggle on longer trips with heavier loads. Hydrogen could power road vehicles – and trains that oper- ate on routes where electrifica- tion simply isn't economical. Hydrogen would be combusted directly or used in fuel cells to drive an electric transmission. Today we have bi-mode diesel-electric trains; in the future we could have hydrogen-electric trains that switch over to hydrogen power when they leave the electrified part of the network. Producing hydrogen Of course, all this would require large quan- tities of hydrogen. How should we produce it? Large-scale production is possible using electrolysis. Low-carbon electricity is used to split water into hydrogen and oxygen – a process that would consume vast amounts of electricity if this were the primary means of hydrogen production. However, electrolysis provides an initial route of supplying hydro- gen, and would be viable where smaller quantities of hydrogen were required for use at a particular site, such as train or bus depots, eliminating the need to transport the hydrogen from a larger production plant to the users. A more realistic option for large-scale hydrogen production is to use natural gas and, to a lesser extent, coal. The steam reforming process produces hydrogen from natural gas, established gasification tech- nologies can produce hydrogen from coal and other carbonaceous feedstocks, and underground coal gasification could make use of residual coal reserves that can't be mined. The downside? It would produce vast quantities of CO2, so hydrogen production would have to be paired with large-scale carbon capture and storage (CCS) in order for the hydrogen to be regarded as a low- carbon fuel. Capturing CO2 Technologies for capturing CO2 from indus- trial processes such as hydrogen and ammo- nia-based fertiliser production are already well established. The technology has also been developed in the power generation sec- tor but is not yet fully commercialised. This reflects a lack of commercial incentive to implement CCS and an unwillingness in the commercial sector to take responsibility for the long-term storage of CO2, lasting hun- dreds or thousands of years. However, the UK is well placed to develop a CO2 storage infrastructure, making use of depleted oil and gas fields or the saline aquifers that are abundant in the UK's off- shore geology. The CCUS Cost Challenge Task Force has made recommendations to government for the ownership structure of offshore storage, following a regulated asset base structure, as used in other regulated indus- tries. It's now up to govern- ment to take the lead in order to facilitate the development of CCS projects in the UK. If the government does lead the way on CCS, it could kick-start a shi to hydrogen. It won't be cheap, but we've already seen what government subsidies did for renewables. Learning by doing and economies of scale bring down costs, so later iterations of a technology are much less costly than the first. Wind power is now via- ble without subsidies and economies of scale have reduced the cost of solar. With the right market conditions, hydrogen could be next. Tony Alderson, associate consultant, gas and power, WSP Can hydrogen power the UK? Hydrogen has an important role to play in a lower-carbon future, says Tony Alderson, if the UK can work out how best to produce large quantities of the element and deal with the resulting carbon "Hydrogen production would produce vast quantities of CO2, so it would have to be paired with large-scale carbon capture and storage in order for the hydrogen to be regarded as a low-carbon fuel." The current gas distribution grid could support hydrogen – up to a point

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