05-05-2012, 12:44 PM
Hydrogen Production and Distribution
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PRODUCTION & COSTS– Hydrogen (H2) is an energy carrier. It can be produced from all forms of energy and
used for power generation or as a transport fuel, mainly in association with fuel cells. Natural gas and coal are
currently the cheapest sources of H2 and will remain so. Because production processes release CO2, however, CO2
capture and storage (CCS, ETE01) are vital to reduce emissions. H2 production from renewable and nuclear energy
will need more R&D and more time to enter the market. Decentralised H2 production is the best choice for market
uptake and for avoiding costly distribution infrastructure. But it is less efficient and costs more than large-scale,
centralised production. The cost of decentralised H2 production may exceed US $50/GJH2
today. Over the coming
decades, improved technologies could provide fossil fuels-based H2 at $10-15/GJ, including the cost of CCS.
DISTRIBUTION – Because of the low volumetric energy density of H2, its distribution for energy use is rather
expensive and energy-intensive. Investment and pumping-power requirements are greater than for natural gas.
Large-scale H2 distribution by pipeline adds $1-$2/GJ to H2 production costs. Distribution of liquid H2 is more
costly ($7-$10/GJ) as energy is needed for liquefaction at -253°C. Refueling stations may add $3-$9/GJ to H2 costs.
STORAGE IN FUEL CELL VEHICLES (FCV) – On board H2 storage presents R&D challenges (see ETE06, Fuel
Cells). The compactness, driving range and cost of current options do not yet meet the requirements. Gaseous
storage (350-700 bar) and liquid storage (-253°C) are commercially available, but energy-consuming and costly.
Electricity needed for gas and liquid storage represents, respectively, some 12% and 35% of the H2 energy content.
The tank costs $3,000-$4,000 per vehicle. Solid storage promises potential breakthroughs, but much R&D is needed.
INFRASTRUCTURE – Global investment to supply H2 to the world’s transport sector could be in the range of
several hundred billion dollars over several decades ($0.1-$1.0 trillion for pipelines and $0.2-$0.7 trillion for
refueling stations). This level of investment is not insurmountable in the long term, but building infrastructure today
is premature because key H2 technologies that may have an impact on infrastructure are still under development.
POTENTIAL & BARRIERS– H2 could gain significant market share in the transport sector if costs of production,
IEA Energy Technology Essentials - Hydrogen Production and Distribution April 2007
Electrolysis is a well-known electro-chemical process
to split water into H2 and oxygen (O2) using electricity.
Alkaline electrolysers with potassium hydroxide (KOH)
electrolyte are commercially available. Efficiency is a
key parameter for electrolysis, as costs are largely
determined by electricity costs. Best-practice efficiency
could be higher than 85% (GJH2/GJel), but commercial
devices achieve between 55% and 75%. New advanced
electrolysers may approach the upper limit. At high
temperatures, heat consumption increases while
electricity needs decrease. High-temperature electrolysis
(800ºC-1,000ºC) may therefore offer higher efficiency,
in particular using residual heat. Also, high-pressure
electrolysis can make H2 pressurisation unnecessary and
improve efficiency. New electrolyser concepts are based
on fuel cells working in reverse mode. Small-scale
polymer electrolyte membrane FC (PEMFC)
electrolysers (60°C-80°C, 15 bar, 50% efficiency) are
commercially available.
distribution and end-use technologies (e.g., fuel cells) decrease according to expectations, and if strong policies are
put in place to reduce CO2 emissions. Under favorable assumptions, H2 could be entering the market around 2020
and powering some 700 million fuel cell vehicles by 2050 (30% of projected global fleet). Besides costs, other
barriers to H2 use for energy applications include dedicated infrastructure needs, as well as competition with other
emerging technologies and fuel options such as biofuels and battery-electric vehicles. However, since no single fuel
or technology is likely to meet fast growing demand for clean transport fuels, various options are expected to play
complementary roles in diversified regional markets.
INFRASTRUCTURE - Estimates of H2 infrastructure
investment are complicated by significant uncertainty.
The cost of H2 supply infrastructure for road transport is
estimated to be in the order of several hundred billion
dollars. Assuming large-scale, centralised H2 production,
the cost of worldwide pipeline-based distribution
systems for road transport could range from $0.1 to $1.0
trillion. The incremental investment in refueling stations
would be somewhere between $0.2 for centralised H2
production and $0.7 trillion for decentralised production.
A full H2 economy (i.e., widespread use of H2 in
transport and stationary sectors) would require global
pipeline investment in the order of $ 2.5 trillion, the bulk
of which would be to finance supplying commercial and
residential customers. Assuming early retirement or
partial replacement of existing natural gas pipelines, a
significant part of this cost would be incremental. The
level of investment needed for H2 infrastructure is not
insurmountable when compared with the $20-trillion
investment in energy supply systems that is estimated to
be needed if growth in energy demand up till 2030 is to
be met (IEA World Energy Outlook 2006).
POTENTIAL & BARRIERS - According to Prospects
for Hydrogen and Fuel Cells (IEA, Dec. 2005) and
Energy Technology Perspectives (IEA, June 2006), H2 is
likely to gain significant market share over the coming
decades if the cost of H2 production, distribution and
end-use fall significantly, and if effective policies are put
in place to increase energy efficiency, mitigate CO2
emissions and improve energy security. H2 production
costs should be reduced by a factor of 3 to 10 (depending
on technologies and processes) and fuel cell cost by a
factor of 10 or more. At the same time, emission
reduction incentives of $25-$50/tCO2 (depending on
fossil fuel price) would help to make H2, fuel cells and
other clean energy options more competitive
economically.