New research on advantages of natural gas-derived hydrogen

The American Petroleum Institute (API) recently published new research on the advantages of natural gas-derived low-carbon hydrogen.

When hydrogen incentives are consistently offered based on a per ton of GHG emissions reduced, the study, which was commissioned by API and carried out by ICF, found that hydrogen produced from natural gas with carbon capture and produced from electricity and other energy sources could eliminate an additional 180 million metric tons of greenhouse gas (GHG) emissions on average per year through 2050 and save over $450 billion cumulatively through that time.

According to an API review of the study’s findings, achieving the newly released National Clean Hydrogen Strategy and Roadmap’s objective of creating 50 MMT of clean hydrogen by 2050 will depend on consistent incentives for manufacturing hydrogen from natural gas, electricity, and other energy sources.

The following are some report highlights:

  • Greater Hydrogen Market: By 2050, the U.S. hydrogen market may be three times larger when every ton of emissions is treated equally as opposed to when it is treated unequally (i.e., the hydrogen market may account for 15% of total end-use energy consumption as opposed to 4% of total end-use energy consumption).
  • Greater GHG Emission Reductions: By utilizing low-cost alternatives like hydrogen produced from natural gas with carbon capture, the larger hydrogen economy brought about by uniform incentives could prevent an extra 183 million metric tons of U.S. GHG emissions annually through 2050 as opposed to if incentives were implemented unevenly. According to API calculations, enabling incentives for all hydrogen generation would be comparable to removing the annual emissions from more than 38 million cars.
  • Less Expensive Emission Reductions: By 2050, uniform incentives might save more than $450 billion by lowering the cost of reducing a metric ton of carbon by an average of 12% annually over the study period.

According to the report, in order to fully realize hydrogen’s potential to significantly reduce GHG emissions, it will be necessary to build crucial hydrogen infrastructure, such as hydrogen storage facilities, pipelines, and local distribution networks. By 2050, capital expenditures for infrastructure projects involving hydrogen could reach $400 billion. These projects would entail building 67,000 miles of transmission pipeline, 500,000 miles of customer laterals and local distribution company pipeline/service lines, and 560 trillion Btu of underground hydrogen storage.

To access the entire report, click here.

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