North Sea Sees Hydrogen Future

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Hydrogen produced from natural gas and wind power in the southern North Sea could meet the energy needs of London and the southeast for decades to come. That's the standout finding of a study commissioned by the UK Oil and Gas Authority (OGA) which reckons the area of eastern England around the Bacton gas import terminal in Norfolk could continue to play a "major role" in the country's energy future. It says blue hydrogen could be made employing carbon capture and storage (CCS) technology for gas sent to Bacton from offshore fields, while green hydrogen could be produced from electrolyzers powered by nearby offshore wind and nuclear capacity. The UK government has set tough decarbonization targets as part of the drive to achieve net-zero emissions by 2050. Hydrogen could be used to displace fossil fuels, for electricity generation, or for seasonal storage and backup to renewables for longer periods than demand-side management or batteries can cover economically. Annual hydrogen demand could reach nearly 10 terawatt hours of gas by the end of the decade, climbing to nearly 70 TWh gas in 2040 and almost 90 TWh gas by 2050, the Progressive Energy study finds. The transition will result in a smaller role for gas without CCS. It will either have to be converted to blue hydrogen using steam methane reforming, with the carbon dioxide then captured and stored, or used in its natural form with carbon capture technology (WGI Dec.23'20). The report says blue hydrogen could meet nearly 15% of the government's goal of reducing CO2 emissions by 10 million tons by 2030. It adds that the Bacton area could account for 40% of the government's 40 GW offshore wind target and for 20% of London's target of 5 GW of hydrogen production capacity by 2030. The bulk of hydrogen demand will come from the residential and commercial sectors. Policymakers in London -- which along with southeast England accounts for about 20% of UK energy demand -- acknowledge that gas will likely be needed beyond 2030 in hard-to-decarbonize sectors such as heating, industrial processes and heavy-duty transport, but say unabated use must stop (WGI Dec.16'20). OGA has been studying the potential for emissions reduction technologies such as CCS and hydrogen since committing the UK Continental Shelf to go net zero by 2050. Its North Sea Transition deal with the government published in March allows oil and gas exploration to continue indefinitely provided licenses are only granted to projects that meet stringent net-zero criteria (WGI Mar.31'21). The deal allocates £16 billion ($23 billion) in joint government-private investment to 2030 to support emissions-cutting technologies. But OGA says investment must continue in existing gas infrastructure, as well as producing and prospective fields in the southern North Sea, if the UK is to produce enough blue hydrogen to meet demand before green hydrogen costs fall, likely after 2040. The group estimates that fields already sending gas to Bacton hold roughly 1.4 trillion cubic feet (39.7 billion cubic meters) of reserves, while up to 2.2 Tcf of reserves remain to be developed in the southern North Sea. In addition, a number of undeveloped fields with a high CO2 content could be economically developed for blue hydrogen. Blue hydrogen has the advantage of being continuous, although there are cost issues around CCS and gas prices. Green hydrogen is likely to end up cheaper as wind and solar costs continue to fall, but intermittent renewable power feedstock is a drawback, and low load factors for electrolyzers could drive up costs. BP in March unveiled plans for a blue hydrogen complex at Teesside in the north. Norway's Equinor plans a similar project, H2HSaltend, in the Humber region in the northeast. On the opposite coast, Progressive Energy is developing the blue hydrogen HyNet North West project. Jay Eden, London

Gas Demand, Hydrogen, Energy Storage
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