Unlocking the power of green hydrogen



By Barbara-Anne Bensted, Capgemini’s Head of Sustainability for APAC.

As the world moves towards imperative sustainability initiatives, industries globally are trying to find newer, cleaner, and more sustainable energy models and solutions. Energy production is one of the largest sectors contributing to the global emissions and carbon crises and working with high-emission sectors to accelerate decarbonisation is crucial for a sustainable future.

In this regard, Green Hydrogen is gaining recognition as one of the possible routes to sectors such as industry and heavy mobility, which have a high emission rate. Many countries, including Australia, have announced significant investments to accelerate the development of green hydrogen as a potential energy source for the future.

What is green hydrogen?

Hydrogen’s valuable attributes – such as high energy content per unit mass (three times more than gasoline); lack of CO2 emissions at the point of use; and potential as a storage medium for electricity – make it an attractive energy vector and fuel. For hydrogen production to be considered low-carbon, it must come under the EU’s proposed emissions threshold of 3.38 kg CO2-equivalent per kg of hydrogen. Hydrogen created from green energy sources such as renewables, biomass, and nuclear sources are classified as super green, green, and pink hydrogen respectively.

Championing green hydrogen in Australia

Today prominent production pathways for hydrogen continue to rely on the use of fossil fuels. As we move more and more into Green Hydrogen, new commercial opportunities are being created throughout the value chain – including alternative revenue streams and new business models. However, there needs to be an economically competitive alternative to carbon-based hydrogen if businesses consider it viable in the long term.

The Australian Renewable Energy Agency (ARENA) has announced a further A$50m in funding across four hydrogen projects listed under the German-Australian Hydrogen Innovation and Technology Incubator (HyGATE) initiative. Germany invested an additional €40m in the joint initiative, focused on establishing a green-hydrogen supply chain.

Challenges to adopting green hydrogen

The current costs of hydrogen production are very high, and organisations are facing cost-related challenges throughout the hydrogen value chain. In terms of research and development, the high capital cost of electrolyser units is a challenge.  Furthermore, low-carbon-hydrogen production in alternative areas (e.g., setting up offshore production facilities) is a problem because of its high cost as well as the unavailability of land. Add to this the high cost of storage, building new hydrogen-compatible infrastructure for storage and distribution, and the high cost of transportation of gaseous hydrogen all make it a very expensive fuel for global adoption.

There are also global engineering and infrastructure-related challenges, such as the high energy consumption during production. With hydrogen being a highly volatile, combustible gas with a very low energy content by volume, storage presents significant challenges, including high flammability raising safety concerns, low durability of storage materials – such as fiber, metals, polymers, etc., and the required specificity of storage conditions (such as high pressure, cryogenic temperature, etc.) Infrastructure requirements for the transport and distribution of hydrogen is also crucial, however, nearly 7 in 10 (68%) E&U organisations investing in the transport of low-carbon hydrogen, rank “insufficient existing hydrogen pipeline infrastructure” among the top five challenges. Moreover, it is also difficult to get certifications on the quality and proof of origin of hydrogen owing to the lack of international standards.

Roadmap for the future of green hydrogen:

  •  Pioneering sustainable business models

In order for organisations to adopt green hydrogen, they must align organisational strategy and capabilities to develop new and innovative business models. They also need to assess the economic viability, scalability, and environmental impact of these models. To enable these models, defining a governance structure dedicated to low-carbon-hydrogen production along with a focus on education and upskilling programs is required. They can then accelerate the low-carbon hydrogen economy through technology and digital engineering.

  • Collaboration and partnerships

Organisations must clearly articulate partnership strategy and design appropriate trade-offs while partnering with primary energy producers, equipment suppliers, storage-system developers, Infrastructure providers, end-users, and the end-to-end value chain. Stakeholder collaboration is an important facet of scaling up green hydrogen production. To scale up hydrogen production, investments must be shared between public and private players and customer demand must be strong.

  • Overcoming challenges and promoting innovation

Currently, high costs and a lack of infrastructural support seem to be some of the key challenges in the adoption of Green hydrogen. Addressing these challenges associated with scaling up green hydrogen production, pioneering sustainable business models through innovation and technology and collaborating with the right partners, can all help optimise processes and efficiency. Technologies such as digital twins, artificial intelligence (AI), analytics, and blockchain can help address implementation challenges by modeling various scenarios to maximise ROI and allow data-driven decision-making throughout the lifecycle and across ecosystems.

Future outlook and opportunities

It is evident that low-carbon hydrogen holds real decarbonisation potential. But in order to succeed in their initiatives, organisations will need to navigate several obstacles along the way to seize the opportunity, mitigate costs, and scale at pace. As we quickly move towards our sustainability targets, organisations must act fast to innovate and build long-term solutions to the carbon emissions issue. To emerge as a preferred partner for end-user organisations, and to bring low-carbon hydrogen as a viable alternative, organisations should build partnerships with electrolser providers, renewable-energy producers, storage providers, and supply-chain entities to facilitate production at scale.

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