Save for later Print Download Share LinkedIn Twitter Gases will play a key role in the energy transition, but what will that look like? Many experts predict hydrogen will become the central energy carrier of the future while natural gas could stay around for quite some time, either as a bridge fuel or hydrogen source. Meanwhile, urgency is mounting for carbon dioxide, another gas, to be removed from the atmosphere. A company at the forefront of this changing landscape is Linde, a leading industrial gas and engineering player formed in 2018 by the merger of Germany's Linde AG and the US' Praxair. Tilman Weide, senior vice president in charge of global execution at Linde Engineering, shares his expectations with Energy Intelligence Senior Reporter Philippe Roos (related). Q: The energy transition is very much about electrifying as much demand as possible. Can everything be electrified? A: In the time we have available for the transition, it's likely that not everything can nor should be electrified. Chemicals and areas with intense energy needs are a long way from being electrified. Transport and housing could be electrified faster, but only if we had all the electricity available quickly enough. Looking at the timeline of what we need to achieve by 2030, 2040 and 2050, electrification alone is not the solution. We need blue solutions, meaning fossil fuels with CCUS [carbon capture, utilization and storage], as well as other renewable energy sources, besides electricity. Equally, of course, we need to continue efficiency improvements to reduce the amount of energy we consume because it's still rising globally. The gap between what we have in renewable power versus what we need in total power is still opening up. Today, electricity is only one-third of total energy consumption, and truly green electricity from hydro, wind and solar is only between 20% and 40% of total electricity generation, depending on regions. Q: So we need hydrogen. There's increasing momentum, but is it going fast enough? A: It has gained a lot of momentum in the past year and we clearly see the rise in hydrogen use outside of the classical sectors. It's expanding, for example, to mobility, and will expand in the future as an energy vector. Furthermore, it will play a crucial role in transporting energy from areas with abundant supply to areas with limited renewable energy resources. But it is too narrow to focus on green hydrogen [from electrolysis] only, as there won't be enough clean power in the next years to make the large quantities of hydrogen we need for industry use -- for steel and cement production, for example. To start using hydrogen quickly, we also need blue hydrogen [from natural gas with carbon capture], at least during a transition period until renewable electricity is vastly available. Q: But aren't Germany and Europe clearly pushing green hydrogen? A: The EU is more open to blue hydrogen production. Germany is still struggling between tendencies, whether blue should be acknowledged as a transition technology, or whether it could slow down the real green movement. In my opinion, we need both because the expansion of green hydrogen is not fast enough to address the need to reduce CO2 emissions quickly. Q: Would Europe need to import blue hydrogen, or could it continue to import natural gas, particularly from Russia, and convert it locally? A: If the gas is decarbonized with this same efficiency in Europe or anywhere else in the world, it would not make such a big difference and we could do both. The point is: where do the carbon molecules from the natural gas go to? Do we have equal sequestration possibilities in every area? Europe has huge old gas reservoirs in the North Sea, which are suitable for sequestration of CO2. In other regions, that needs to be studied. There are also other technologies [such as natural gas pyrolysis], which are not yet fully developed, but may be suitable for other regions. Q: Speaking of technology, what are the main issues around hydrogen? A: There are many opportunities for further developing mature blue hydrogen technologies. For electrolysis, we see promising opportunities in terms of higher efficiency, or in terms of using less precious metal resources. Transport will also become a topic: How can we transport hydrogen molecules, no matter whether they're green or blue? We already have the right technology to transport them with pipelines on distances up to 2,000-4,000 kilometers, similar to natural gas, something that could be possible from North Africa to Europe for instance. And we have solutions to liquify hydrogen. Extracting it from liquid ammonia is another possibility. Q: We'll also have synthetic fuels, won't we? A: Green hydrocarbons and e-fuels need to be evaluated very carefully because there's again the carbon atom issue. Where's this carbon in green fuels coming from? If it's from biomass, then we'll really close the carbon cycle. But if it is from an existing CO2 source, then it is only a second use of the same molecule. This way, we'll be halving the quantity that is emitted but it's still half and it's still from fossil sources. And then, of course, the overall energy efficiency for these liquid fuels is decreasing due to the many transformation steps involved. The more steps we have in the energy conversion, the more we lose. Therefore, we need to stay as close as possible to the original molecule. Q: Does it mean that ammonia should be used as such, and not cracked back into hydrogen? A: Yes, that is the most efficient way. We have so many liquid fuels to be replaced, in ships for instance or in heavy trains. Engine builders are working on that intensely. Liquids are more for the very heavy vehicles [such as ships, heavy freight trains and mining trucks], and hydrogen for lighter vehicles such as passenger trains and road trucks. And keep in mind that large amounts of ammonia are required for fertilizers. Their production is currently fossil-based, without carbon capture. Q: What about liquefied hydrogen? A: From an efficiency point, it's better than e-fuels. We distribute liquid hydrogen by trucks and trains. For long-distance transport by ship, there's still development to be done, but if the regasification is done cleverly, we can recover a good portion of liquefaction energy. That would give it a push. The technology is there, but that's also something which needs to be increased in size. In principle, it's doable. Q: You mentioned the issue of carbon sources for synthetic hydrocarbons. Isn't direct air capture (DAC) a solution? A: I believe in air capture as long as it's trees and forests. As an industrial technology, the efficiency is too low. It is far from industrial scale and we have so many untapped high concentration sources of CO2 that it makes very little sense to recover it out of air instead of taking it out of these concentrated sources. The only good thing about DAC is it could be applied anywhere. Q: Like hydrogen, CCS has been discussed for a long time without taking off but now seems to have gained momentum. Are there technology issues or is it just a matter of scale or regulation? A: It's a matter of policy. The technologies are there, the scale is possible, but we need the policies to allow the CO2 to be stored properly. Certain countries in Europe are doing big steps forward, such as the UK, the Netherlands and Norway. They are really moving forward to get the right regulation to make CCS possible. Q: Aren't costs -- and subsidies -- also a big issue? A: CCS costs energy and capex, so yes, there is a cost to it. But the gap between avoidance costs [at around $100/ton] and the cost of CO2 certificates [at over $50/ton on the EU ETS (Emissions Trading System)] is not so big. I would expect it to close pretty soon and then we won't need subsidies anymore. The cost gap between green and grey hydrogen, for instance, is bigger and will take longer to close. Q: There's also a scale issue. Is a multibillion-ton CCS industry realistic? A: I would think that the amount of CO2 that is produced from fossil fuels will be reduced over time. Therefore, the need for CCS will also decline. However, during a transition period, we will have a ramp-up of CCS capacity. Q: Isn't the capture rate another issue for CCS? A: No. Depending on the applied technology, we can virtually capture 100%. However, the capture rate impacts the economics and needs to be looked at on a case-by-case basis also considering other aspects, for example the use of renewable feedstock. Q: Is CCS doable everywhere? A: CO2 capture requires the possibility for local sequestration, which limits CCS application in some regions. However, if you think CCS also in terms of solid carbon capture, this extends its potential globally. Q: How green can the chemical industry become? A: Let me give you an example. Linde, BASF and Sabic are building an electric cracker together. More generally, it will be easier to decarbonize the energy consumption of the chemical industry than to defossilize its products. But theoretically, it could be totally green. With the right power mix, you could always combine hydrogen and biogenic carbon to make plastics and organic molecules. You'll still have the recycling issue with plastics, but that's a totally different topic. Q: What's the future of natural gas? A: Globally, there are lots of economies which will rely for quite some time on fossil fuels or nuclear energy. That's India, China, Africa and so forth. And there's the drive to replace coal with gas, which is already less carbon intensive, so it's the right move. Therefore, we believe that natural gas and LNG will play an important role to shape the energy transition, supported by CCS. Q: What about synthetic methane, which could be mixed with natural gas and share the exact same infrastructure? A: There's the same carbon atom issue as for e-fuels and methanol. If we solve this issue, then synthetic methane is an absolutely valid fuel. And it's true it's easy to transport in existing infrastructure and not so difficult to handle. So it can have its place if we do the carbon molecule right. Q: What do you think of the European Commission's Fit-for-55 proposal? Is it the right thing to do? A: We are an advanced society, we have technologies, so it's good that Europe is taking a bold step forward, absolutely. It is ambitious, absolutely. But if we don't have ambitious goals, then we risk achieving less. And it's fairly open, technology-wise, which is also good. We need technology openness and leave it to the economy, to the companies, to find the best solutions to achieve the targets. Q: Is the proposed carbon border adjustment mechanism (CBAM) also good? A: At first sight, it looks interesting and good to push the good cause forward. But if you look more into details, it's really complicated and could become a bureaucratic monster. First, the mechanism of how to determine and calculate the exact CO2 burden on a certain product is not clear. We need to be careful if or when it is applied. Second: How does that help exports? You can ban imports or tax them to put them on the same level in terms of CO2 exposure. But that doesn't help our industry, which is traditionally export-oriented. Do we get some money back if we export green steel to a country where green steel is not required? I have not read the answer to that yet. So I have mixed feelings about the CBAM. Q: Is the energy transition a risk or an opportunity for the European industry? A: For the part of the industry that builds plants and designs processes, it's absolutely a chance, a huge new market. For the part of the industry that owns assets, it may be a risk if that part of the industry is not transforming its assets quickly enough.
