The Road to Hydrogen: Coalition launches Road Map to a US Hydrogen Economy , tips 17 million ton demand by 2030

October 7, 2020 |

In Washington, a coalition of major oil & gas, power, automotive, fuel cell, and hydrogen companies have come together to develop a Road Map to a US Hydrogen Economy.

In the most ambitious scenario, the authors concluded that hydrogen demand potential across all these applications could reach 17 million metric tons by 2030 and 63 million metric tons by 2050.

The Road Map stresses the versatility of hydrogen as an enabler of the renewable energy system, an energy vector that can be transported and stored, and a fuel for the transportation sector, heating of buildings and providing heat and feedstock to industry.  It can reduce both carbon and local emissions, increase energy security and strengthen the economy, as well as support the deployment of renewable power generation such as wind, solar, nuclear and hydro.

About the coalition

A coalition of leading companies from the energy, transportation, fuel cell manufacturing and electric power industries worked jointly to develop this comprehensive road map, sharing and developing economic models as well as data on future energy needs and environmental expectations. Analytical support was provided by McKinsey and scientific observations and technical input was provided by the Electric Power Research Institute.

Progress to date

The U.S. is already heavily engaged in the hydrogen economy with hundreds of millions of dollars of public and private investment per year, and boasting more than half the world’s fuel cell vehicles, 25,000 fuel cell material handling vehicles, more than 8,000 small scale fuel systems in 40 states, and more than 550 MW of large-scale fuel cell power installed or planned.

The 5 Big Markets

Buildings. An estimated 47 percent of US homes currently have natural gas space heating, and another 3 to 8 percent (depending on region) use liquified petroleum gas (LPG) heating. Replacing or blending some natural gas with low-carbon hydrogen would lower GHG emissions of residential, commercial, and industrial heating, without new infrastructure deployment. This can be achieved by blending hydrogen into the natural gas grid or deploying stationary fuel cells directly in buildings to generate electricity and use the heat they produce in lieu of traditional space and water heaters.

Transport accounts for a third of US carbon emissionsvi and directly affects air quality in cities. FCEVs and battery-electric vehicles (BEVs) are the only zero-emissions vehicle (ZEV) solutions to reduce emissions for light-duty, heavy-duty, and material-handling vehicles. With fueling times similar to conventional gasoline or diesel vehicles, and with larger on-board energy storage capacity than BEVs, FCEVs are a natural complementary ZEV technology for the transport sector to transition to zero carbon. This makes light-duty and heavy-duty FCEVs a familiar and competitive mobility solution for customers who want the capability to refuel quickly, drive long distances, carry heavy loads, or have high uptime. On a total cost of ownership (TCO) basis, FCEVs could break even between 2025 and 2030 with the cost of internal combustion engine (ICE) vehicles in applications requiring high uptime and fast fueling, and they already cost less than BEVs as forklifts and in fast charge applications above 60 kW.

Industrial processes. Industry accounts for about 20 percent of US carbon emissions. The hard-to-decarbonize industrial sectors can use low-carbon hydrogen as feedstock in industrial processes such as steelmaking, chemical production, and refining, or as a heating source to replace fossil fuels. In steelmaking, for example, hydrogen can work as a reductant, substituting coal or natural gas. Other heavy industrial sectors like ammonia, methanol, and refining already use large quantities of traditional hydrogen (synthesized from natural gas) and would need to transition to low-carbon hydrogen to reduce their emissions.

Backup power or off-grid power. Through stationary fuel cells, hydrogen provides clean, noiseless, and odorless power. It provides backup power for data centers, hospitals, and other critical infrastructure, as well as off-grid power on military bases and in other remote facilities with fast ramp-up or ramp-down capabilities. The use of hydrogen fuel cells instead of diesel generators in data centers appears on track to achieve cost parity in three to five years and has additional advantages, such as reduced clean-air permit constraints and increased operational flexibility. It also has the potential to offer services back to the electric grid in the forms of energy storage and peaking capacity.

Grid-connected hydrogen production could support the deployment of variable renewables, by providing demand flexibility to the system. Electrolyzers have the ability to flex up and down to help match the variable and intermittent supply profile of wind or solar energy. This improves the case for renewables, as it partially offsets the intermittency problems on the supply side. Where required, stored hydrogen can also be converted back into power via fuel cells or using hydrogen-ready gas turbines (at a new or retrofitted power station). In this way, hydrogen can provide a long-term, high-capacity electricity storage mechanism.

Reaction from the stakeholders

“This Road Map shows how critically important hydrogen is to achieve a lower-carbon energy mix, and with the right actions now, can reinforce U.S. energy leadership and strengthen our economy by generating $140 billion per year in revenue and 700,000 jobs by 2030, and $750 billion per year in revenue and 3.4 million jobs by 2050,” said Fuel Cell and Hydrogen Energy Association (FCHEA) President Morry Markowitz.  “In addition, if the right actions are taken now a competitive hydrogen industry can meet 14 percent of U.S. energy demand by 2050.”

“Clearly, the U.S. is a major player,” Mr. Markowitz added, “but to remain dominant, and meet future energy challenges, the U.S. has to raise its game with further investments and public policies that reduce regulatory barriers, promote research, development, and deployment, and reward innovation.”  He cited the report’s analysis that “other countries are laying plans for hydrogen economies and the U.S. will need to move quickly to continue to lead in this growing industry.”

Each step along the path noted above brings the U.S. closer to the hydrogen future that will help power the nation, clean the air and support crucial new jobs.  According to FCHEA’s Markowitz, the U.S. is already making progress on that road.   However, “The report makes clear that how far we will go and how fast we get there is very much up to us, and the choices we make over the next few years” he said.

More on the story

The study can be viewed here.

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