Green hydrogen may not be cost-competitive in this decade, or even maybe in the first half of the decade beginning 2030, says Lee Levkowitz, BHP’s manager for energy, carbon and technology research. Speaking at the Hydrogen and Mines virtual summit, she said the economics of hydrogen production, especially the green variety, are currently “challenging.”
In that view, she said BHP would not bank on green hydrogen for achieving its decarbonizing goals.
“And it’s not purely just the cost equation either – the sheer amount of electricity that’s required to produce green hydrogen is also a barrier,” Levkowitz added.
She outlined a three-pronged mantra for bringing down production costs for green hydrogen: Improve electrolyzer technology, reduce energy costs, and spread relevant fixed costs over a higher production output from the electrolyzer.
Unfortunately, achieving those goals could take years; meanwhile other technologies were already eating green hydrogen’s lunch in “easier-to-abate” sectors such as renewables for power and electrification of light duty transport. These make up about two-thirds of global emissions, the BHP executive said, emphasizing that, after all, “you only need to decarbonize a sector once.”
This trend relegates green hydrogen to a niche role, and therefore into a low-level equilibrium trap, where a technology is high cost because it is low scale, and it is remains low scale because it is high cost.
Sources: Mining Weekly, BHP
Image Source: BHP