ACORE Webinar Summary — State of the Industry Webinar: How Can Hydrogen Enable 100% Renewable Targets?
By Sarah King, CHBC Clean Energy Fellow
On October 27, the American Council on Renewable Energy (ACORE) hosted “State of the Industry Webinar: How Can Hydrogen Enable 100% Renewable Targets?” Ethan Zindler of BloombergNEF provided an overview of the current renewable energy market. The general market overview transitioned into a panelist discussion on the future role of hydrogen in decarbonization — Michael Ducker, Vice President of Renewable Fuels at Mitsubishi Power, Sean Ebnet, Vice President of Business Development at Orsted, and Skip Grow, Managing Director at Morgan Stanley all shared their insights on the growth of the hydrogen industry.
The COVID-19 pandemic altered energy markets in the first half of 2020; oil demand dropped to record lows and remains below typical levels, while renewable investment fell but is expected to rebound in the second half of the year. Despite the omnipresent disruption of the pandemic, “the industry is proving pretty indestructible” stated Zindler. BloombergNEF anticipates additional 2.4TW of installed renewables in the U.S. by 2050, 57% of which will be wind and solar — total renewables are expected to provide 58% of all power supply in the U.S. by 2050. Zindler ended with the high LCOE of green hydrogen, stating it will likely not reach cost competitiveness with gray hydrogen until at least 2030.
The panelists were unanimous in their belief that hydrogen integration is required to achieve a fully decarbonized world. Hydrogen’s long-term storage capacity counterbalances the intermittency of renewables — Ducker emphasized that hydrogen’s greatest contribution is as an energy storage resource, not fuel, because it can enable the expansion of renewable buildout.
Despite its critical function, green hydrogen has yet to grow at scale. Grow listed a number of barriers to green hydrogen market growth. The cost of Western built electrolyzers is still prohibitively high for wide-scale adoption. The cost of renewable energy power — though the cheapest form of new energy — still needs to decrease. The cost of storage and transportation needs to decrease; Europe is planning an EU-wide transportation pipeline network, whereas the U.S. will be relying on costly trucks transportation. While the U.S. is exploring hydrogen blending into existing natural gas pipelines, Ducker mentioned that around 1,600 miles of dedicated hydrogen pipelines already exist in the Gulf Coast, so a hydrogen pipeline network in the U.S. would not be a novel idea.
All panelists discussed policies at the federal and state levels that could enable growth and expansion of hydrogen. Grow believes internalizing externalities of carbon emissions through a national carbon price and requiring certain emissions and capacity standards will promote technological solutions and market advancement. Ebnet mentioned the importance of policymakers to not pick winners, but rather open up more routes to the market. Ducket emphasized the need of long-term planning to produce the greatest net benefit, rather than lowest cost.
The ability of hydrogen to help decarbonize a variety of sectors poises the industry for rapid growth and success in the coming decades. Ducker closed remarks by highlighting the momentum that exists in the hydrogen and greater renewables industry — regardless of the pandemic or political landscape, the industry will continue to swell and dominate the future of energy.