the future of hydrogenhydrogen – a common element of our energy future ? •momentum currently...

IEA 2019. All rights reserved.

The Future of HydrogenDr. Timur Gül, Head Energy Technology Policy Division, IEATokyo, 17 June

IEA

2IEA 2019. All rights reserved.

Hydrogen – A common element of our energy future ?

• Momentum currently behind hydrogen is unprecedented, with more and more policies, projects and plans by governments & companies in all parts of the world

• Hydrogen can help overcome many difficult energy challenges

Integrate more renewables, including by enhancing storage options & tapping their full potential

Decarbonise hard-to-abate sectors such as steel, chemicals, trucks, ships & planes

Enhance energy security by diversifying the fuel mix & providing flexibility to balance grids

• But there are challenges: costs need to fall; infrastructure needs to be developed; cleaner hydrogen is needed; and regulatory barriers persist


A growing number of countries have policies to encourage hydrogen deployment, predominantly focusing on transport.

Policy support for hydrogen is increasing

0 5 10 15 20

Industry

Power generation

Buildings heat and power

Trucks

Electrolysers

Buses

Vehicle refuelling stations

Passenger cars

Number of countries

Combined incentiveswith targets

Targets withoutincentives

Incentives withouttargets


About 4 000 fuel cell cars were sold in 2018, but they only represent a small fraction of the global light-duty vehicle fleet.

A new record number of fuel cell cars, but…

0

2 500

5 000

7 500

10 000

12 500

2017 2018

Num

ber o

f veh

icle

s

Others

China

Rest of Europe

France

Germany

Korea

Japan

United States


Electrolyser capacity additions and their average sizes have been growing rapidly in recent years, providing cost reductions from economies of scale and learning effects.

An upswing in global electrolyser capacity additions

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20

40

60

80

100

120

1990-94 1995-99 2000-04 2005-09 2010-14 2015-19

MW

Alkaline

Proton exchangemembrane


Global demand for hydrogen in pure forms has grown steadily over the past 50 years to around70 Mt today. More than 40 Mt is also produced in a mixture of other gases.

Hydrogen is already with us, for a long time

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20

30

40

50

60

70

80

1975 1980 1985 1990 1995 2000 2005 2010 2015 2018e

Mill

ion

tonn

es o

f hyd

roge

n

Refining

Ammonia

Other pure

Methanol

Steelmaking (DRI)

Other mixed

Pure hydrogen

Mixed together with other gases


Virtually all hydrogen today is produced using fossil fuels, as a result of favourable economics.

The current state of hydrogen production

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200

400

600

800

1 000

2018

Mt/

yr

CO2

Gas

Oil

Coal

0

2

4

6

8

Natural gas Natural gasw/CCUS

Coal Renewables

USD/

kg

Hydrogen production costs, 2018


Low-carbon hydrogen from fossil fuels is produced at commercial scale today, with more plants planned. It is an opportunity to reduce emissions from refining and industry.

Hydrogen production with CO2 capture is coming online

OperationalPlanned

Facilities with hydrogen production and CCUS


The declining costs of solar PV and wind could make them a low-cost source for hydrogen production in regions with favourable resource conditions.

Renewables hydrogen costs are set to decline

USD/kgH2Long-term hydrogen production costs from solar & wind systems


Mid-load operation of electrolysers achieves the lowest hydrogen costs, balancing CAPEX, OPEX, and electricity costs.

A sweet spot for electrolytic hydrogen production

0

5

10

15

20

USD/

kgH

2

Full load hours

Electricity use

CAPEX+OPEX

Hydrogen costs from

Electrolytic hydrogen production cost at different full load hours

Area of lowesthydrogen costs


Electrolytic hydrogen is the least carbon-intensive production process, but only if electricity of low CO2 intensity is used.

How clean is hydrogen?

0 5 10 15 20 25 30 35 40

World average electricity mix

Renewable or nuclear generation

Without CCUS

With CCUS, 90% capture rate

Without CCUS

With CCUS, 90% capture rate

Elec

trici

tyN

atur

al g

asH

ard

coal

kgCO2/kgH2

CO2 intensity of hydrogen production


The challenge to 2030: expand hydrogen beyond existing applications

Dependable demand from current industrial applications can be used to boost clean hydrogen production; policies & industry targets suggest increasing use in other sectors, but ambition needs to increase.

Growth in hydrogen use based on announced policies, 2018-2030

New uses

BuildingsTrucksCarsOther

Growth to 2030, 24 Mt

Chemicals

Refining

Steel

New uses


Hydrogen demand for ammonia and methanol for existing applications is set to rise.

Dependable hydrogen demand growth from the chemical sector

0

10

20

30

40

50

2000 2018e 2030 2050

Ammonia

MtH

2/yr

0

5

10

15

20

25

2000 2018e 2030 2050

MethanolM

tH2/

yr

Fertiliser

Methanol toolefins andaromatics

Industrialapplications


Future hydrogen demand in the refining sector comes mostly from today’s existing capacity.

Oil refining: dependable, but not growingHydrogen demand from oil refining

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10

20

30

40

50

2018 2022 2026 2030

MtH

2/yr

Current trends

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10

20

30

40

50

2018 2022 2026 2030

MtH

2/yr

Low carbon pathway

On-purpose supply(new refineries)

On-purpose supply(existing refineries)

Refinery by-product


The hydrogen-based DRI-EAF route is between 10% and 90% more costly than its natural gas-based counterpart, and is highly sensitive to the cost of electricity.

Hydrogen routes for steel production are emerging, but expensive

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250

500

750

1 000

1 250

Blast furnace route(BF-BOF)

Direct reduction route(DRI-EAF)

Oxy. SR-BOF w/CCUS(HIsarna)

100% hydrogen DRI-EAF(HYBRIT)

Commercial Demo Pilot

Leve

lised

cost

of s

teel

(USD

/t)

Range

CCUS costs

Feedstock

Fuel

Fixed OPEX

CAPEX

Costs of steel production, 2018


Total costs of ownership could break even with EVs at 400 km drive range. Prospects for fuel cell cars depend on cost reductions in fuel cells and storage tanks, and the utilisation of stations.

Which cars will win the low carbon race?

0.30 0.40 0.50 0.60 0.70 0.80 0.90

Fuel cell EV400 km

Battery EV400 km

Battery EV250 km

Fuel cell EV400 km

Battery EV400 km

Toda

yLo

ng te

rm

Total cost of ownership for cars (USD/km)

Battery, fuel cell

Operations and maintenance

Electricity, fuel

Refuelling, charging infrastructure


Total costs of ownership could break even with EVs at 400 km drive range. Prospects for fuel cell cars depend on cost reductions in fuel cells and storage tanks, and the utilisation of stations.

Which cars will win the low carbon race?

0.30 0.40 0.50 0.60 0.70 0.80 0.90

Fuel cell EV400 km

Battery EV400 km

Battery EV250 km

Fuel cell EV400 km

Battery EV400 km

Toda

yLo

ng te

rm

Total cost of ownership for cars (USD/km)

Battery, fuel cell


Electricity, fuel

Refuelling, charging infrastructure

Low utilisation of infrastructure


A low carbon future for trucks?

0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8

Fuel cell EV

Battery EV

Hybrid catenary

Diesel Hybrid

Long

term

Total cost of ownership for trucks (USD/km)

Battery, fuel cell


Electricity, fuel

Refuelling, charging



Fuel costs make up about half of the total cost of ownership for heavy-duty truck; reducing the delivered price of hydrogen is key to achieving cost-competiveness with alternative fuels.

A low carbon future for trucks?

0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8

Fuel cell EV

Battery EV

Hybrid catenary

Diesel Hybrid

Long

term

Total cost of ownership for trucks (USD/km)

Battery, fuel cell


Electricity, fuel

Refuelling, charging



Potential hydrogen demand might be on the order of 12–20 MtH2/yr in key markets, but would require the final energy prices for hydrogen to be ranging USD 1.5–3.0/kgH2 in order to be competitive.

Buildings represent a big – but challenging – opportunity

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2

4

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Canada UnitedStates

Japan Korea WesternEurope

Russia China

Hyd

roge

n de

man

d (M

tH2)

Potential hydrogen demand for heating in buildings 2030


Compressed natural gas tanks, turbines and engines have the lowest hydrogen tolerance. Minor adaptations could increase the grid’s tolerance and exploit its transport capacity.

Constraints on blending

0% 20% 40% 60% 80% 100%

CNG tanks

Gas turbines

Engines

Cooking

Boilers

Underground storage

Compressors

Transmission

Gas meters

Distribution

End

use

Tran

smiss

ion

&di

strib

utio

n

Allowable under certain circumstances

Tolerance of the natural gas network to hydrogen blend shares by volume


Four key opportunities for scaling up hydrogen to 2030


The IEA’s 7 key recommendations to scale up hydrogen

• Establish a role for hydrogen in long-term energy strategies

• Stimulate commercial demand for clean hydrogen

• Address investment risks for first-movers

• Support R&D to bring down costs

• Eliminate unnecessary regulatory barriers and harmonise standards

• Engage internationally and track progress

• Focus on four key opportunities to further increase momentum over the next decade


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the future of hydrogenhydrogen – a common element of our energy future ? •momentum currently...

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