Hydrogen Interest Mounting Fast: GE Official Q&A

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The world has gone from nobody talking about hydrogen to everybody wanting to know about hydrogen, a GE Gas Power official in the Middle East tells Energy Intelligence. Hydrogen — along with artificial intelligence and other tools — have become key parts of the brainstorming process where GE is working alongside governments to draw up plans for them to decarbonize while also balancing energy affordability and supply security. The company's Europe, Middle East & Africa Chief Technology Officer Otmane Benamar spoke with Energy Intelligence's Yousra Samaha on the sidelines of the Atlantic Council's Global Energy Forum in Abu Dhabi.

Q: What is the energy trilemma and what mix of solutions will be needed to address it in emerging markets? 

A: As you may know, 40% of carbon emissions are coming from power generation. So definitely it is one of the areas where we need to put all the efforts to decarbonize in order to help with climate change. Now, when you look more specifically at the emerging markets, these emerging markets have one of the highest growth rates in electricity consumption and demand. And some of them also still have a gap between demand and supply.

So you cannot treat sustainability simply by reducing the carbon emission; you need to care about all the trilemma, which is: one, you need to make sure that you have reliable power for the industries and for the people to improve the economy, two, you need to worry about the cost of the electricity. Even developed countries now have to deal with that cost because of the increase of fuel prices. We saw issues in France about things as simple as the baguette because the bakeries' bills went crazy. And they couldn't maintain the same prices. So the government has to do something to keep those prices low. When we talk about affordability, we need to make sure that the cost of generation is low, and also the cost of fuels, to make sure ultimately, the people will pay the right price.

And three is the sustainability: we need to make sure that we care about the existing assets to improve their emissions. And when we add capacities, we need to look at reducing the carbon intensity overall.

Q: Recent events have put energy security at the forefront. How has this impacted the energy trilemma, especially in emerging markets?

A: The area where it has hit the most is reliability. If you don't have the right fuel supply chain, you may end up not being able to run the power plants. And we've seen that in many countries, especially for example, in Europe. It is not an emerging market but with the drought this summer as well they had to relaunch power plants that had been stopped, like coal plants, because of the gas fuel supply.

For emerging markets, I think the problem is beyond just security today. They want to first secure the supply. We see a lot of countries who have interest to bring LNG to make sure that they have one of the cleanest fossil fuels in their country, and help grow the power generation. And with the pressure on Europe, a lot of countries in Europe didn't have LNG, so they are building their reserves. So it has become much more difficult for these people to get LNG. I was just talking with one of the key players in the LNG sector and he says they have no FSRUs [floating storage regasification units] available. He said they are running out of FSRUs because most of the developed counties took that to secure the fuel supply. So to me for emerging markets, the problem number one is the supply itself and making it a secure supply.

Q: Has this impacted crucial timelines to slow down rising temperatures? Are these goals now under threat?

A: In those countries which have been running gas assets, which has lower emissions, and who had to turn to coal plants, yes, that's not good news for climate change. It's a breach into their path to net zero, but I think it's a temporary situation. Overall, when you look at the globe, still, coal plants are being retired, even though temporarily in some areas they are launching, but if you look at the numbers, I think it's 150 gigawatts of reduced coal plants. So overall the trend is still there. We may see temporary situations. But overall, we're going on the right path.

Q: How is GE supporting the UAE and other regional countries meet their carbon neutrality goals and achieve energy transition targets?

A: On how we support our customers in the region, the first thing is the technology. That's number one. We bring the right technologies to every specific customer. We go into discussion with them, and we make sure of what they need for their path to net zero. We continue developing technology to make sure we can burn higher blends of hydrogen and that we can do more competitive carbon capture, so we work on the solution.

Second is we collaborate with them to build their path to net zero. We had many discussions with the Ministry of Energy in the UAE, for example, to talk about their specific problem and to support them in that brainstorming of how to come up with their path to net zero.

We're doing this with customers as well through MOUs [memorandum of understanding]. We have an MOU with Adnoc, for example. We have an MOU with Aramco in Saudi Arabia. And we also have some local resources like the GE Manufacturing and Technology Center (GEMTEC) campus in Dammam, which we initially brought to address the specific environmental challenges of the region and now with the new challenges that we have to address when it comes to decarbonizing, we upgraded that center to become the decarbonization center for the region. It's based in Saudi so we are closer to the customer, we're closer to their problem statement. And we are helping them to come up with their specific path to net zero.

Q: Should we expect more partnerships and project announcements this year ahead of COP?

A: Definitely, we hope that this kind of event is a catalyst to make sure that there is, first, more discussions with all the sectors to start thinking about how they can help with decarbonization. In the last one, which was in Egypt, we partnered with some local companies to demonstrate the existing assets, which is an LM 6,000 [aeroderivative gas turbine] with capability to burn hydrogen. In that case we did the demonstration with 5%. But that machine is capable as we demonstrated in the US with the New York Power Authority, we went up to about 40%. We have started already talking to the partner. I mentioned the MOU with Adnoc, with Aramco. All customers will have assets from us to think about what can be done, and how it can be accelerated within this COP28 context.

Q: How has hydrogen evolved in the past year, especially in light of the energy crisis?

A: To be honest, there has been a big shift. We went from nobody talking about hydrogen to everybody wants to know about hydrogen. I think in Europe, probably that has accelerated. Here in the [Mideast] region there was less impact of that security of gas. But still people are really thinking about what they can do to decarbonize. We have such events, and with the Ministry of Oil, for example, in Iraq, where we talked about decarbonization, hydrogen or carbon capture, but also we talked about capturing flare gas for power generation so that CO2 doesn't go wasted without generating megawatts. Iraq is lacking about 15 gigawatts of power. We are talking with customers like PDO [Petroleum Development Oman], we've been working on hydrogen, there's a lot of discussion about hydrogen with all our customers. Now, of course, we need to see the same movement on the supply, because a lot of people talk about the generation, but sometimes we forget about the supply, and we forget about the logistics. So I hope that things will move fast on that area as well.

Q: Is it then safe to assume that in terms of hydrogen the coming year or two will be about finding solutions for supply?

A: Yes. One, making that supply available. There are different colors of hydrogen. Whether you're producing blue or green, you need water in an area which is water scarce and you need to make it at a low cost. You heard the lady from the DOE [US Department of Energy, who was speaking at the same conference] talking about their objective of $1 per kilogram on the horizon of 10. That will barely bring the hydrogen on a competitive level with natural gas. There are a lot of discussions. Adnoc is developing blue hydrogen, Aramco is also developing blue hydrogen and ammonia, Neom, which has already started the project with Acwa Power and Air Products to export ammonia to the US. There are multiple initiatives to produce hydrogen in the region.

We're talking also in Morocco with some of our customers about bringing green hydrogen, because Morocco has a very good corridor of wind, which helps them to get a very low cost of electricity, which definitely will help achieve low cost of hydrogen as well. We have seen interest from some Indian investors announcing 10 gigawatts of hydrogen in Morocco — due to their proximity with Europe that will help make some projects happen. Egypt is talking about some projects, same in Tunisia. Because we have land, so they want to make sure that they can benefit from solar or wind to produce green hydrogen and export it.

Q: How is a company like GE supporting emerging markets in their energy transition?

A: One of the first things is to make sure that the grid can handle the transition and the introduction of renewables. So, as GE with our portfolio, we can help across the board. From help improving the quality of the grid, and two, helping them with their existing assets to improve their efficiencies, because we should not wait for the miracle solution that will shift from 100 to zero; that's not how it works. We need to make sure that we can upgrade for output, efficiency, for flexibility, because even the assets will need to be flexible to support intermittency.

Look at the example of Sharjah [efficient newbuild gas power plant]. We displaced 1.8 gigawatts of inefficient assets to the most efficient assets on the grid. That's a decarbonization because we reduced from E class technology to H class technology. By doing that, Sharjah reduced their emissions of carbon for power generation by four tons per year. That's the equivalent of 1 million cars out of the road of the UAE.

These are the kinds of things that we're doing with our customers. Converting from simple cycle to combined cycle. A lot of countries in the region still have assets running with very low efficiency and just by adding what we call the steam side, we can produce 50% more power with zero additional fuel and that reduces the carbon intensity by 30%.

Q: What principles should policymakers in emerging markets focus on to support net-zero carbon goals?

A: They should focus on setting the goals. How much and by when? How to get there? They should let the key players have the power generation sector come up with the right path to achieve that goal.

There is no one size fits all when it comes to decarbonization. Countries like Iraq will have a different path as the UAE, which already has renewables and gas. So every country will have its own path. And even within the same country, you cannot impose the same objective, or the same way of doing, to different industries. We cannot impose the same way to everybody. We need to tell them what they need to achieve by when and let them come up with a plan that will get them there.

Q: Much is being said about the potential of new technologies such as AI in helping address climate change, but to what extent are these technologies really being deployed so far at a large scale? Will it take much longer for these to produce tangible results? How are they coming along in the Mideast?

A: It is already there. It is going fast but it's already started. As an example, we have metrics, smart AI introduced in smart metrics, which helped everyone manage their power consumption, and reduce consumption but also for sustainability and for affordability, that's important. And we are also helping our customers with smart outage planning tools that minimize the unavailability of the assets, to make sure that we can bring the asset down, do our routine maintenance and bring them back in a very short time in a very safe and high-quality manner.

And the other thing that we're doing is dispatch optimization. This is really key, because this is how you can make sure that you're running in sync, renewable and conventional power generation. Human beings themselves will not be able to plan for a cloud coming, or wind blowing less, but those digital tools can plan for all of that. They can get the weather forecast and make sure that it will run first to the renewable, and when the wind stops blowing, it will pull the gas turbine power plants, for example, to make sure there is a seamless transition and people will not have the reliability issue.

And also it will help optimize the cost by running the right assets if the gas prices are high, maybe you want it to run other assets that have lower costs. So the digital really helps you there because it can make the decision in milliseconds, where human beings would need planning and cannot plan for the unexpected. So it's all there and it's still coming up. It will still improve as AI improves.

A lot of customers have already adopted those smart tools. It’s already there. Our latest technology comes with built-in digital tools that can help our customers run in an optimized manner. We are working already on this with EGA [Emirates Global Aluminum] here in the UAE.

Leadership Interviews, Hydrogen, Renewable Electricity
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