Opinion: Hydrogen Economy Or Electricity Economy?

There are two conclusions of relevance to the US nuclear energy community. First, hydrogen has a critical inefficiency problem that is rooted in thermodynamics. This is essentially unsolvable and renders hydrogen impractical as either an energy carrier or an energy storage tool. Second, economics, technical practicality and the urgency of strengthened national security through energy independence, all mean electricity is the overwhelming favourite as the energy carrier that will be carrying stationary-source energy to the transportation sector in the 21st century.

Long before hydrogen becomes feasible, the less-expensive energy carrier – electricity – will have already captured much of the US transportation market. Therefore, the US nuclear energy community would be well advised to sidestep hydrogen and focus, over the next several critical decades of nuclear renewal, on its fundamental issues: passive safety, proliferation resistance and closing the fuel cycle. This would ensure that nuclear energy continues to be available, viable and sustainable as the lowest-cost provider of grid-distributed electricity.

It should be noted that the hydrogen industry accounts for a relatively trivial sliver of the overall national US energy budget. Capturing the present hydrogen market is certainly not the big hydrogen opportunity that would justify the investment to develop dedicated nuclear heat-based hydrogen production plants. As long as transportation continues to be based on petroleum, there is no big hydrogen opportunity worthy of a dedicated plant level of focus.

Nearly all hydrogen in use today is itself being "produced" by stripping hydrogen from natural gas through steam reformation of methane. There is no technical advantage to reforming methane in preference to electrolysis of water; there is only a price advantage of about a factor of two. Today, natural gas is trading with a floor price of about five US dollars (USD) per MBtu. That price will need to rise permanently above USD 9 per MBtu before methane reformation will quantitatively yield the hydrogen supply market to electrolysis using electricity costing four US cents per kilowatt hour (kWh) (all figures based on 2004 valuations).

The truth about whether hydrogen best serves national security and energy independence goals depends upon how its burden of application weighs on the national economy in comparison to other options. A hydrogen vehicle using hydrogen derived from coal-fired electricity is actually several times more polluting than a gasoline-powered vehicle. Surprisingly, many conversations with attendees at the 2004 meeting of the National Hydrogen Association and much of the present literature reveal that many hydrogen enthusiasts don’t make the distinction between energy carriers versus energy source.

Basic conversion and handling losses waste most of the energy. The result is that for every four power plants making electricity, only one plant’s electrical output actually ends up being productively used. Three power plants’ output is lost simply because hydrogen is part of the process. That level of waste is unacceptable in any situation, particularly at a time of global energy-related challenges.

Long before petroleum is depleted and future generations are considering a replacement "fuel", electricity will have already captured a vast portion of the transportation market through a very simple and predictable maturation of today’s hybrid technology. Why will this happen? Because electricity is cheaper.

If you think people might resist a change from quick fuelling at the petrol station to overnight charging, think again. A 2001 study by the US Electric Power Research Institute found that most people surveyed preferred plugging in a vehicle to filling up at a petrol station. Overnight charging perfectly fits our present grid functioning, which tends to be electricity rich during night-time off-peak hours.

After being attacked at every turn through our history, the US nuclear energy community might have trouble believing that something may actually go well for us. Nevertheless, we are perfectly poised for the only legitimate opportunity to extend stationary-source energy to the transportation sector this century. Rather than speculation on a revolution in transportation based on a thermodynamically inefficient fuel and an altogether new infrastructure, perhaps we should notice that the transportation evolution – based on a familiar energy carrier and existing technology – has already begun.

The strength of the relationship between the hydrogen economy and renewables cannot be overstated. The wind doesn’t always blow and sunlight isn’t always striking every solar panel. Renewable energy desperately needs a very big battery, a load leveller. Without some form of energy storage, renewables are physically limited to less than a 20% share of the grid. At 20%, renewables are more of a headache than a resource for a grid manager.

The hydrogen economy is not really about energy security or clean air. The hydrogen economy is a backdoor attempt to integrate renewable energy’s desperately needed load leveller into general commerce.

My advice to fellow greens in the renewable energy community is as follows: recognise that the 25% loop efficiency problem with hydrogen is essentially unsolvable because it is rooted in thermodynamics – hydrogen is a lousy load-leveller. Instead, work to minimise the weather-dependent grid limitation problem of renewables by focusing on improvement of the North American grid infrastructure and encouraging utilisation of more efficient electricity storage tools.

However, reducing greenhouse gas (GHG) emissions in transportation with hydrogen or methanol would be much more expensive per unit of GHG reduction. Consumers would need convincing to pay for all of the additional plants and all that new infrastructure, in addition to buying the much more expensive, fuel cell-based vehicles – all for the pleasure of using a fuel that is several times more expensive than electricity.

There are two messages here for the US nuclear energy community. First, for GHG emission reduction, coal-fired plants are the low-hanging fruit. Coal’s own estimates are two to three additional cents per kWh to separate carbon dioxide and inject it into subsurface geologic formations. Coal simply doesn’t have that price margin relative to nuclear – regardless of the fact that utilities are planning more than 100 gigawatts of electricity generating capacity from new coal plants.

When coal’s long-enjoyed externalities finally come home to roost, the coal industry will not be able to hide the facts that coal is both the dirtiest and the most easily replaced form of fuel. That’s 50% of the US grid up for replacement. That most certainly is not a trivial sliver of the overall national energy budget.

The second message is that the most economical and probably only economically viable way to reduce GHG emissions (and oil imports) in transportation is to support and encourage the hybrid evolution by providing clean, economical electricity.

Electricity is mankind’s cleanest, most-efficient energy carrier. Nuclear energy is mankind’s only non-greenhouse gas emitting energy source that is available around the clock, regardless of the weather.

There is no conceivable future energy scenario in which nuclear energy will be more heavily used than to make electricity for the grid.

There are significant challenges to a hydrogen energy carrying scheme. These include materials development, tremendous cost barriers, infrastructure inadequacies and the very low conversion efficiency. While many of hydrogen’s problems could be reduced with enough time and effort, the fact remains that the 25% efficiency problem of the electricity to hydrogen to electricity loop is unsolvable. Societies worldwide will be struggling this century and beyond just to afford to replace their existing GHG-belching stationary sources with clean, non-GHG sources like nuclear, wind, low-heat hydro and solar. There certainly will not be an overabundance of clean energy to squander on an inefficient hydrogen loop, particularly when the same tasks can be accomplished directly with the original electricity. Not this century, anyway.

Most of the needed grid growth and coal replacement will go to nuclear if critical mistakes – like seeing our reactors closed because there is no path for large volumes of low-power density, once-through spent fuel – are avoided.

Nuclear growth is inevitable. The US nuclear energy community should ignore the hydrogen red herring and concentrate on our fundamental issues, particularly reversing the mistake of the 1970s by redeveloping core skills in waste volume and proliferation risk minimisation through closing the fuel cycle. This would ensure that nuclear energy continues to be available, viable and sustainable as the lowest-cost provider of electricity.

Electricity will always be nuclear energy’s primary national mission.