China’s Green Hydrogen Message Spells Bad News For Russia
By Sourced Externally
March 24, 2022
As global green hydrogen production surges, China appears to be sending a message to Russia regarding future trade in fossil energy.
In a curious case of timing, earlier this week China announced an ambitious plan to jack up its production of green hydrogen. The plan appears aimed at increasing the nation’s deployment of hydrogen without an equal increase in its dependence on natural gas or coal, which are the main sources of hydrogen today. Russia, are you listening?
Curious Timing on Green Hydrogen
The timing is curious because China has been playing its geopolitical cards close to the vest all during Russia’s misbegotten rampage through Ukraine. The new plan appears to signal that China is preparing to distance itself in the not far-off future.
If all goes according to plan, the green hydrogen scheme could could upend the role of Russia as China’s leading supplier of oil after Saudi Arabia, its third-largest supplier of natural gas, and its leading supplier of coal after China.
For those of you new to the topic, green hydrogen can be produced from biogas and other bio-based sources. However, most of the activity has focused on applying renewable energy to push bubbles of hydrogen gas out from water, and China has an ample supply of both renewable energy and water on hand. The country won’t necessarily need more natural gas to produce more hydrogen, or to level out carbon emissions from other leading industries.
Green hydrogen made no sense as commercial venture back when the cost of wind and solar power was sky-high. As those costs have come down, the green hydrogen market has exploded, and for good reason. Hydrogen is already part and parcel of the modern global economy. Shoving fossil sources out of the way will have widespread implications for rapid decarbonization.
Hydrogen can be used as a combustible fuel to run power plants. It can also be used to generate zero emission electricity in a fuel cell. That means both stationary fuel cells for on-site electricity generation as well as mobile fuel cells to run cars, buses, trucks, aircraft, watercraft, locomotives, and construction equipment. In an interesting twist, hydrogen can also be deployed to run EV charging stations for battery-electric vehicles.
Hydrogen plays a leading role in modern agriculture, food processing, personal care products, and medical supplies. With the renewable energy angle in hand, green hydrogen is also beginning to displace fossil energy in steel making and other hard-to-decarbonize industries.
China is Still Going To Use Some Regular Old Hydrogen
To be clear, the basis of China’s plan is an overall increase in the deployment of hydrogen, regardless of the source. That leaves the door open to increasing the use of natural gas to produce hydrogen, at least over the near term. On the bright side, fossil-sourced hydrogen could help reduce near-term reliance on petroleum and coal in other industrial sectors, paving the way for a faster transition as green hydrogen production gets up to speed.
China outlined its renewable H2 plans earlier this week, in a widely reported joint statement from the National Development and Reform Commission and the National Energy Administration.
In the green hydrogen area, the near-term goal is to ramp up production to reach anywhere from 100,000 to 200,000 tonnes per year by 2025, with the aim of chipping away at the role of natural gas in the nation’s hydrogen profile.
The plan also describes an interim goal of 2030 before moving on to 2035, when the expectation is that green hydrogen will become a significant feature in China’s energy transition.
China Gets Its Green Hydrogen Act Together
The new hydrogen plan will not come as a surprise to energy analysts. On February 3, the Center for International and Strategic Studies published a analysis by Jane Nakano, a Senior Fellow in the organization’s Energy Security and Climate Change Program, which details the nation’s green hydrogen activity to date.
“China is the largest producer of hydrogen today, at about 25 million tons (Mt), or roughly a quarter of the global total. Most of the volume is produced from fossil fuels (60% from coal, and 25% from natural gas) as feedstocks in refineries or chemical facilities,” Nakano explains. “However, China is increasingly exploring cultivating the production and consumption of lower-emission hydrogen to help meet energy needs and spur industrial development while also addressing climate concerns.”
Her key takeaways included this one…
“A massive renewable power generation capacity in China could help underpin the rapid expansion of renewable-based hydrogen.”
…and this one:
“The vast potential for renewable-based hydrogen production and the significant energy consumption profile may mean that China would become neither an exporter nor an importer of hydrogen.”
Interesting! If the new national hydrogen plan is realized, it would be a significant step up from the current state of affairs.
Nakano observes that the government-supported China Hydrogen Alliance has estimated that it will be 2060 before green hydrogen (potentially including hydrogen from biomass) accounts for 20% of energy consumed in China.
Of Course, There Had To Be An FCEV Angle
Nakano also brings up the fact that China is the third-largest fuel cell electric vehicle market in the world, and the first-largest for fuel cell trucks and buses.
The numbers are tiny now, but Nakano cites the country’s 2016 Hydrogen Fuel Cell Vehicle Technology Roadmap, which aims at a fleet of 50,000 FCEVs by 2025, towards a goal of 1 million by 203o.
Apparently things got off to a rocky start, but Nakano takes note of the potential to roll right over those 2016 numbers, based on hydrogen fuel station availability.
The 2016 plan envisioned 300 fuel stations by 2025 and 1,000 by 2030. However, the 2020 “New Energy Vehicle Industry Development Plan” calls for an increase from 72 units in mid-decade to 2,000 units by 2035.
Gosh, it looks like those FCEV fans were on to something after all. You can bet all the fuel cell truck fans in the US will be taking a close look at the goings-on in China.
If you have any thoughts about that, drop us a note in the comment thread.
Who’s Gonna Pay For All This?
Speaking of comment threads, CleanTechnica’s David Waterworth heard from the usual suspects when he posted a piece on the cost of sustainable H2 earlier this week, but Nakano offers up a perspective in support of his reporting.
She notes that renewable energy capacity is not a limiting factor for China’s green hydrogen industry, so the deciding factor is the falling cost of the electrolyzer systems used for pushing hydrogen gas out of water.
“For example, a report by the Hydrogen Council notes that electrolysis at the current levelized cost of electricity in China is already competitive with low-carbon production technology, such as coal gasification with the capture and storage of carbon emissions, and suggests that electrolysis would become the lowest-cost low-carbon production technology in all Chinese locations by 2030,” she writes.
Game on. Meanwhile, it’s important to note that China’s near-term entanglement with Russia’s fossil energy economy is still very much in play. However, as Vladimir Putin’s murderous, misbegotten war on a nation at peace continues to spiral into a black hole of human suffering, oppression, and brutality, it appears that China is looking forward to an energy future that relieves it from the burden of playing fossil energy patty-cakes with a pariah nation.