Developing Models for a Sustainable Transition to Green Hydrogen in Western Canada

Abstract

This work aims to conduct a techno-economic feasibility analysis of adopting a hybrid approach to hydrogen generation. This includes grey hydrogen sourced from natural gas using Steam Methane Reforming (SMR) and green hydrogen from renewable energy. The key focus is on assessing the environmental impacts of such a transition over the next decade in Western Canada while ensuring a clean and stable supply of hydrogen for various industrial processes. A life cycle assessment (LCA) is performed to ascertain greenhouse gas emissions per kg of hydrogen produced. The system boundaries extend from the set up and generation of renewable electricity at standalone and integrated renewable power plants (solar and wind) to the production of hydrogen using water electrolysis. The viability of a site for hydrogen generation from renewables is based on a study of the photovoltaic (PV) and wind potential of various locations in Western Canada. Additionally, an analysis considering the expected improvements in efficiency and scale of upcoming electrolyzer technologies is incorporated into the model. Most of the life cycle CO2 emissions of solar and wind sourced hydrogen are from the initial setting up of the power plants. In comparison with SMR sourced hydrogen, total life cycle emissions show a reduction of approximately 90%. As electrolyzer technology is improved, hydrogen produced using dedicated renewable sources will achieve price parity over the longer term with the model proposed. An analysis is performed to ascertain the relative viability and cost of utilizing low-cost electricity for hydrogen generation. This includes the development of models based on various electricity price thresholds. It is expected that up to 15% of the annual hydrogen demand could be met by using this clean electricity, depending on the model adopted. It also helps predict the rate at which a hybrid supply of hydrogen can be converted to a primarily green hydrogen supply. These results will serve as a reliable way to transition from grey hydrogen that is currently being produced to green hydrogen, without increasing costs exponentially and with no change in availability. The analysis provides a roadmap for a phased decarbonization of various industries, including the oil and gas industry, where hydrogen is used as a feedstock. Further, it acts as a technical guide to effectuating various hydrogen strategies and achieving emission reduction targets that have been envisaged by provinces in Western Canada.