The hydrogen sector may have been in a hype cycle for the last few years, but the fundamentals around the global energy market have not changed – the need for clean and localised energy and a just energy transition remain, says Dr David Hart.

Hart, who does work for H-ETA and ERM, spoke on a number of hydrogen-related issues at a Nedbank-hosted hydrogen roundtable held in Cape Town last week.

He noted that his more than 30 years’ experience had shown him that every hype-cycle reset the bar upwards.

“We have seen significant investment in the hydrogen sector and there has been a lot of development. The money that went in was not all wasted – it trained people, built technology, built supply chains and better understood project engineering.”

Hart said he remained “relatively positive” about where the hydrogen sector was currently.

“There are still going to be companies that fail and projects that get pulled, but the amount of money that has been invested, the amount of development that has happened and costs curves we are on now, all tell a story that we have locked in something that is going to continue to grow.”

Hart said the newest hype cycle was triggered by very low-cost renewable-energy projects that had started to come on stream, generating the need “to do something with it”.

China to Drive Down Costs
Hart said China was well positioned to dominate the technological side of the hydrogen industry, driven by its sheer size, internal demand and export capability.

“China will build good, low-cost fuel cells and electrolysers and they are learning quicker than everybody else.

“There is rapid innovation and the competition is brutal.”

The only proviso, however, was that the necessary quality standards and controls were not necessarily in place yet.

Hart pointed out that hydrogen as an energy source was now enshrined as a strategic industry in China’s latest five-year plan.

“In China we see a very significant rise in manufacturing capacity, and the expectations for mobility are coming back.”

Hart said China was also in a position where it could now develop its hydrogen industry internally.

“They [the Chinse government] can put forward a policy that says you State-owned industry must built the technology, you State-owned enterprise must use the technology – and we’ll put in some support mechanisms so these factories happen.

“There is also tremendous entrepreneurial spirit and enormous deep scientific understanding.”

Hart added that China was working hard to drive down costs.

“Europe and North America were preeminent in the past, but China is now starting to take the position where the tech is getting close, but the cost is much lower – maybe a third – of what we see from the traditional players.

“There is a debate about whether the quality is exactly the same, and the warranties, but this is the typical Chinese playbook where they will build something, get it out, test it, and then do this again and again so there is continuous improvement.”

Hart said the lowest-cost projects in China were now coming onstream at three dollars a kilogram, “which was a really significant shift” from the more traditional six to 20 dollars a kilogram for renewable hydrogen from green solar projects.

Fuel Cells
Hydrogen mobility – fuel cells – had seen some rejuvenation in the last six to nine months in the form of the newly formed Global Hydrogen Mobility Alliance, made up of vehicle manufacturers and the supply chain, said Hart.

“This was kind of unexpected for me.”

Hart added that it was telling that the likes of Honda, Toyota, BMW and Hyundai indicated that they would not focus on batteries alone to power their vehicles, but also fuel cells.

He believed there was space for 10% to 15% of the vehicle parc to run on fuel cells – “which is nontrivial in terms of the amount of fuel cells you need”.

The renewed interest in fuel cells in the mobility sector was also driven by China, which had indicated that it wanted four-million fuel-cell vehicles on its roads by 2040.

Fuel-cell trucks can typically travel longer distances and carry bigger loads than battery-powered trucks.

Hart said fuel-cell technology had also moved beyond road transportation with interest from the maritime, defence, drone and aviation industries.

Stationary fuel cells had also made a comeback, mainly because of the energy needs of hyperscale data centres.

Hyperscale data centres are large-scale facilities run by tech companies such as Amazon, Google, and Microsoft to power their cloud services. These centres are characterised by their large footprint, containing at least 5 000 servers, and their energy appetite as they can consume between 20 MW to 100-plus MW of power.