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How to scale green hydrogen? Digital strategies for AI-based decarbonization

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Florian Kolb's picture
Chief Commercial Officer & General Manager Energy Intertrust Technologies Corporation

Florian Kolb joined Intertrust as Chief Commercial Officer and General Manager, Energy, in January 2020 after a 15-year career in a series of business leadership roles within the European energy...

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  • Dec 14, 2022
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How to scale green hydrogen?

The relevance and role of green hydrogen for decarbonizing the energy system and reaching climate neutrality by 2050 is undisputed. All key research supports the thesis that there will be a substantial use of green hydrogen within the next 5-10 years. There are still many geopolitical, technical, legal, and market-related questions regarding the implementation of green hydrogen.

How to diminish cost imparity for green hydrogen is one (currently the cost for green hydrogen is 3x the cost of natural gas in the US)? A big question is also how to produce enough green electrons to produce the green hydrogen we need. Electricity represents 30-60% of the levelized cost to produce green hydrogen[1], so next to the availability of green electrons, low energy costs play a major role.

Some of the additional issues that need to be addressed:

  • Can green hydrogen provide the flexibility required by an energy system with intermittent renewable energy resources, given its storage and, to a certain extent, transport capabilities?
  • In a green hydrogen context, what’s the role of sector coupling and indirect electrification?
  • Can green hydrogen and sector coupling reduce the overall cost of decarbonization?
  • What levels of co-operation are required to make the energy transition, and green hydrogen’s role within it, happen?
  • What’s the role of the digitization of energy systems and (data) interoperability in this transition?
  • What strategies around data should be considered and pursued (internally and externally)?

With a rising demand for energy and climate neutral energy solutions, sector coupling is recognized by the expert community as a key building block of establishing an efficient, flexible, and clean energy system. Sector coupling is defined as:

  1. the electrification of the mobility and heating/cooling sector via connections to the electrical grid (end-use sector coupling);
  2. the indirect electrification (cross-sector integration) where electricity from renewables is used to produce green hydrogen which then can be used in industrial processes, transportation or for heating purposes.

Both combined can lower emission levels in transportation, buildings, and industry by 60% in the next 30 years. Sector coupling therefore is an essential element of climate action and reducing greenhouse gases and emissions.[2] Sector coupling implies that the production, transportation, and consumption of energy must be harmonized across complex energy ecosystems. These include a wide-range and high number of decentralized but connected energy assets and fragmented local energy consumption. This harmonization of production and consumption can only be achieved when data and information is efficiently and securely exchanged within the energy ecosystems and beyond. Data trust and data security are necessary requirements to make this happen.

Figure 1: H2@Scale energy system

(Department of Energy Hydrogen Plan)

https://www.energy.gov/eere/fuelcells/h2scale

 

Adding green hydrogen to the mix will significantly increase the complexity of the energy system (see Figure 1). The harmonization of decentralized and volatile renewables (wind, solar) and green hydrogen production, green hydrogen storage and transportation, differing energy demand profiles, and connections to the electrical grid requires seamless and decentralized co-ordination and steering. To achieve this requires high levels of information transparency and efficiency (e.g. current and future energy production, consumption, weather data, market data, energy storage data, transportation data).

Highly secure, trusted, and powerful data platforms and execution environments, using state-of-the art and future-proof technologies, will empower the internal and external data sharing, data exchange and artificial intelligence (AI) needed to run and steer this coupled energy system. Energy companies in the ecosystem need to stay agile and improve efficiency with the help of real-time data from distributed data sources (namely IoT and digital twins).

Green hydrogen can only be successful when all existing and future processes are digitized, and data and information can flow in a trusted and secure manner. This will ensure cost-efficient optimization and help to effectively manage the overall costs of decarbonization.

 

[1] Lazard, Levelized cost of hydrogen analysis, 2021

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Florian Kolb's picture
Thank Florian for the Post!
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