Canada is well placed to develop a sustainable hydrogen economy as it forges a path to net zero
As the imperative to decarbonise the global economy becomes increasingly clear, hydrogen is becoming a key tool in that endeavour. It can be produced without any greenhouse gas emissions and does not cause pollution at the point of use. A versatile source of energy, it can replace fossil fuels in applications from heating homes to fuelling heavy transport, such as lorries, trains, ships and even aircraft, that account for 13 per cent of global CO2 emissions.
Hydrogen can also replace carbon-emitting fuels in “hard to abate” and high-emitting industries such as steel, cement and glass, which account for 14 per cent of global emissions. Like heavy vehicles, these industries do not have viable paths to electrification.
“Hydrogen might be nature’s smallest molecule, but its potential is enormous,” The Honourable Seamus O’Regan, Canada’s Minister of Natural Resources, has said, and this is true in terms both of tackling climate change and boosting the economy.
Source: Hydrogen Strategy for Canada, 2020
The projected growth of hydrogen in Canada over the next 30 years
Canada has many natural advantages in terms of building a hydrogen economy: almost 60 per cent of its electricity is renewable and can help produce green hydrogen, and it also has abundant fossil fuel resources and some of the world’s best CO2 storage sites for producing blue hydrogen. The Department of Natural Resources Canada says Canada’s hydrogen strategy could create up to 350,000 high-quality green jobs over the next three decades. “It provides new markets for our conventional energy resources and holds the potential to decarbonise many sectors of our economy,” O’Regan says.
Decarbonising hydrogen
Governments and businesses have thrown their support behind the hydrogen economy. The Hydrogen Council says that projects worth at least US$300bn are due to be built globally during the 2020s.
Hydrogen is widely used in industry today, but most of it is made from natural gas, and for every tonne of hydrogen produced, 10 tonnes of CO2 are released to the atmosphere. We need to produce hydrogen cleanly for it to help us decarbonise. There are two main ways to do this. The first, known as blue hydrogen, is to capture the CO2 generated in the current production process and store it underground or use it to make other products, in a process known as carbon capture, usage and storage (CCUS).
Types of hydrogen production in Canada
Green hydrogen, by contrast, uses renewable electricity and electrolysis to break down water into hydrogen and oxygen. No CO2 at all is created during the process. Blue hydrogen will dominate the sector initially, because equipment to capture CO2 can be fitted to existing production plants. Green hydrogen will accelerate fast but, to become mainstream, it needs much more renewable energy capacity and a huge scale-up in electrolyser capacity.
This is happening. In September 2020, there was only around 200MW of electrolyser capacity worldwide. Projects announced for the 2020–2025 period add up to more than 25GW of capacity, with new initiatives announced almost every week.
In September 2020, there was only around 200MW of electrolyser capacity worldwide. Projects announced for the 2020 - 2025 period add up to more than 25GW of capacity.
Projects
Canada already has a number of green hydrogen projects installed or under construction in Quebec and British Columbia.
- A 20MW electrolyser installed in Bécancour, Quebec, by Air Liquide is now operational and currently the biggest such facility in the world (a status it is unlikely to retain even until the end of the year).
- Hydro-Québec has awarded a contract to a subsidiary of German industrial giant Thyssenkrupp to install an 88MW electrolysis plant in Varennes, Quebec, due to come on stream in 2023.
- Infrastructure bank Macquarie, gas supplier FortisBC and Renewable Hydrogen Canada are looking to develop a green hydrogen plant in British Columbia. It will use the province’s abundant wind and hydro resources to produce hydrogen that will be injected into the local gas network to reduce its carbon intensity.
Source: Hydrogen Strategy for Canada
Forecast worth of global market for hydrogen by 2050
In Alberta, the centre of Canada’s fossil fuels sector, there is more of a focus on blue hydrogen projects.
- At its Scotford complex, Shell’s bitumen upgrader uses hydrogen-addition technology to upgrade bitumen into synthetic crude oil products, eliminating carbon by-products. The plant also has carbon capture technology attached, as one of three in Alberta that produces blue hydrogen, the others being the NWR Sturgeon Refinery and Nutrien’s fertiliser facility.
- Energy group ATCO plans to introduce a five per cent blend of hydrogen into part of its Fort Saskatchewan natural gas distribution system to reduce its carbon intensity. The hydrogen is produced from natural gas and, in time, emissions will be captured and stored.
- A more cutting-edge option is being developed by Proton Technologies, which is looking to produce hydrogen underground, in coal beds and oil and gas reservoirs, then pipe it to the surface. The technology involves injecting oxygen into depleted oil and gas wells, which creates the same process that traditional hydrogen production uses, but underground. The hydrogen is then brought to the surface, along with other valuable resources, including steam for electricity generation, helium, syngas and low-grade heat. “Everything else, including carbon, can be left in the ground,” the company states, adding that the process is especially suitable for heavy oil reserves such as Canada’s oil sands.
Hydrogen is going to be a key component in the low carbon economy, and Canada has all the ingredients to develop a competitive and sustainable hydrogen economy.
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