According to the largest operator of gas infrastructure in Europe, the cost of clean hydrogen will reach that of liquefied natural gas in ten years as efforts to replace fossil fuels increase globally.
According to Thomas Baudlot, CEO of Energy Solutions for Asia-Pacific at French utility Engie SA, green hydrogen is now not economically competitive with alternative energy sources, but that situation will change in ten years. The fuel “very much forms part of Engie’s plan.”
In the midst of a global push to reduce dependence on coal and natural gas, which has intensified since Russia’s invasion of Ukraine in February reduced fuel supplies and raised prices, interest in hydrogen, which is considered green if it is produced using electricity from renewable sources like wind and solar, is rapidly increasing. According to BloombergNEF, 35 countries have a hydrogen plan and 17 are putting one together, which will help lower the cost of the electrolyzers required to manufacture the fuel even though the clean technology is still in its infancy.
To scale up clean technology, the Hydrogen Fund has raised €2 billion.
The need for renewable energy to replace expensive fossil fuels is growing across Asia as a result of the global energy crisis. Engie will market green hydrogen to clients as part of its expansion into Asia, with Australia acting as the region’s production center.
Baudlot stated, “We used to call our clients. “The customers phone us these days. They also desire growth and speed.
Engie made a final investment decision last month for the Pilbara region of Western Australia’s Yuri renewable hydrogen project, with the first phase expected to be finished in 2024. Due to favorable rules, the company is also trying to grow in Malaysia and the Philippines, according to Baudlot.
He claimed that the “dilemma” of liquefying hydrogen stems from the enormous energy needed to do it. According to the U.S., the procedure is pricey and uses up more than 30% of the fuel’s energy. Office of Energy. Because the fuel is less dense than LNG, it would require new ship fleets, infrastructure, and technologies to transfer it at scale.
Due to these limitations, BloombergNEF estimates that by the end of the decade, it will cost about $30 per million British thermal units to liquefy and transport green hydrogen from Australia to Japan. That’s not far off current spot rates, but it’s about quadruple the cost of a similar supply of LNG under a long-term contract from an Australian export facility.
We cannot afford to rule it out, according to Baudlot. “Investing in all mediums is crucial. Natural selection will take place as soon as those get more developed.