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Transcript for Season 5, Episode 5: Has the Moment for Hydrogen Finally Arrived?
HOST: Steel is in everything. Our cars. Our electronics. Our data centers.
Audio clip: “Can you imagine what would happen if some great magnet wrenched all steel from our daily life? [Fade down]
HOST: This clip is from a documentary released in 1938. It’s called “Steel: Man’s Servant.”
How could we travel, how could we farm, how could we even communicate with one another? What would become of all industry? What indeed would become of all of us?”
HOST: Today, we’re even more dependent on steel. But making steel is dirty. Most of the world’s steel is made using what’s called a blast furnace, which looks like a cross between a Dickens-era factory and a scene from Dante’s Inferno.
As you might imagine, it’s a process that takes a lot of energy.
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HOST: Everything starts with coal. You have to superheat it to 2,000 degrees. Then, all that gets blended through various processes, still at high heat, with iron-ore pellets and limestone. Eventually, you wind up with molten iron.
[SFX OF STEEL MILL]
HOST: After more processing, it’s cooled and turned into giant rolls of steel that are used to make everything and anything. Railroad tracks, ships, steam engines, skyscrapers, cars, the microphone I’m speaking into right now. It’s safe to say that steel is the very foundation of our modern world. But, this energy-intensive process has an outsized impact on our environment. It’s estimated that for every ton of steel created in those furnaces, two tons of carbon dioxide are released into the atmosphere. Currently, steel alone contributes eight percent of the world’s greenhouse gas emissions.
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HOST: But figuring out how to get carbon emissions out of steel is a lot more complicated than just putting solar panels on top of a steel plant.
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HOST: You can’t just plug into a renewable energy source and fix the problem. The process itself requires something different. Enter a molecule that has long been hyped as a great environmental remedy: Hydrogen.
With billions of dollars in backing from governments in the U.S. and Europe, many politicians and scientists hope that hydrogen will be one of the last pieces in the climate puzzle. Taking the carbon emissions out of steelmaking. If you could harness enough hydrogen to replace coal in the furnace, you could, in theory, get rid of most of the carbon emissions.
But the idea that hydrogen could be the solution to a very difficult problem, that’s been proposed before, with cars for instance. And that future never materialized in any significant way. So what makes this time different?
That’s today on the show. I’m Arielle Duhaime-Ross, and this is The World As You’ll Know It.
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HOST: It’s helpful to understand where hydrogen comes from. It’s the most abundant element in the universe. Our sun is mostly hydrogen. And all water is made up of two hydrogen atoms, plus an oxygen atom. H2O. But the thing that makes hydrogen stand out is its ability to store a lot of energy. Because of this, hydrogen has long been the dream fuel of futurists and environmentalists.
One of the first internal combustion engines was run on a hydrogen mixture. Airships and zeppelins ran on hydrogen. And then there was this dream. That hydrogen fuel would be used for land transportation. Namely cars and trucks.
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HOST: The new millennium saw a flurry of hype around cars that ran on hydrogen fuel cells. Toyota was developing a hydrogen car. GM worked on a hydrogen version of its famously gas-guzzling Hummer. And in 2004, California Governor Arnold Schwarzenegger announced a green energy plan called “the Hydrogen Highway.”
Arnold Schwarzenegger: We will not just dream about the Hydrogen Highway. We will not just dream about the hydrogen fueling stations. We will not just dream about the hydrogen cars. We will build it.
HOST: If you search online for hydrogen cars, you’ll find endless videos of enthusiasts literally drinking their exhaust.
Archival Clip: “I’m going to have a little sip. Smells like the future.
HOST: Because when hydrogen is used to power a vehicle, the only byproduct is water.
California committed more than $250 million dollars toward its so-called Hydrogen Highway. But now, the highway has hit a dead end. There are only around 50 publicly available fueling stations in the whole state.
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Rachel Fakhry: There was a time where there was an exploration of using hydrogen a little bit more widely. In the early 2000s, under President Bush, there was this push to start getting away from our dependency on oil, and start using a more locally produced source for cars.
HOST: This is Rachel Fakhry, Policy Director for Emerging Technologies with the Natural Resources Defense Council, an environmental advocacy group.
Rachel Fakhry: But then that sort of thinned away and sputtered out. And that's largely because folks realized that this is an expensive resource, right? A hydrogen car was quite expensive. And at the same time, electric batteries or electric vehicles started making strong technological advancements, and basically just EV’s became the center of attention, as they should, because for cars especially, EVs are far more efficient.
HOST: A lot of the expense tied to hydrogen has to do with how you get it. Because in nature, it's almost always found as a compound, in the form of gasses, liquids, or solids. Which means you have to decouple it from the other atoms it's attached to. And that can be both expensive, and pretty bad for our climate.
The most common method companies use to make hydrogen today is called “steam methane reforming,” which relies on natural gas. Most hydrogen produced in the U.S., almost 95% of it, is made this way. The method uses superheated steam to interact with natural gas under high pressure, producing three byproducts: hydrogen, carbon monoxide, and carbon dioxide. Making hydrogen this way currently accounts for between two and three percent of global carbon emissions . But, there’s another method for producing hydrogen that can be climate-friendly. It’s called electrolysis. And, chemically-speaking, it’s pretty simple.
Rachel Fakhry: The process is essentially you run an electric current through water, split it into its constituents, get the hydrogen out.
HOST: That’s it. Electricity and water. The machine that does this is called an electrolyzer. Electrolyzers can range in size from “small enough to sit on a desktop,” to “large enough that it needs a huge facility.” These large electrolyzers can produce more than eight tons of carbon-free hydrogen a day.
But in practice, splitting the strong chemical bonds that make up water takes a lot of energy.
Rachel Fakhry: One large scale hydrogen project could consume as much power as a mid-sized city. So already this should start ringing a little scary, because if a hydrogen project is not powered by clean energy, essentially 24/7, then it's going to drive a lot of emissions on the power grid because it's going to require some fossil fuel plant on the grid to turn on or increase its generation to meet that large demand coming from hydrogen. And just to give you a sense of how big of a risk this is, a hydrogen project that produces hydrogen from water, if it's powered by a dirty grid, could be twice as bad as the hydrogen that we produce today from natural gas. Twice as bad.
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HOST: Industry experts have developed this color-coded scale to help people understand how clean their hydrogen is. It starts with black, which comes from burning coal. Then there’s gray and blue and turquoise, which come from various processes using natural gas. There’s also a specific color for nuclear. But the color we really want to focus on in this episode, and the big goal for decarbonizing our economy is green hydrogen. This is hydrogen produced using only water and renewable electricity in a process that produces no carbon emissions.
Rachel Fakhry: And if the power that you're using is renewable, clean, then your whole process is virtually carbon free.
HOST: Right now, hydrogen is used most often by the petrochemical industry to refine various forms of fuel. And more crucially, hydrogen is used to make modern fertilizer. Hydrogen-based fertilizers are a big reason that agricultural production was able to match pace with the world’s growing population, which quadrupled in the 20th century.
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HOST: One of the biggest benefits of green hydrogen could be steelmaking. Because, to make steel, you need to create particular chemical reactions. And traditionally that’s been done by burning coal and therefore releasing a lot of CO2. This is why the steel industry is so dirty and also so hard to decarbonize.
And here’s where hydrogen comes in: it can substitute for coal, which makes the process a lot less messy.
Rachel Fakhry: This is a resource that essentially could replace fossil fuels and those really tricky, we call them “hard-to-electrify” applications. There are two very simplistic and crude categories of a vision for hydrogen. You either use it in a very widespread manner in buildings and cars and power plants and so on. Not good. Widely inefficient. It's going to really complicate our transition to a clean economy because it needs so much energy and it's so expensive. And then you have vision number two, which is the vision really that maximizes public interest. It's using hydrogen where it makes sense. In a very targeted manner. And those are those really hard-to-electrify applications, like an aircraft, ship, a steel plant. This is where hydrogen really has the best value because we don't have better solutions.
HOST: There are pilot projects here in the U.S. testing the best way to make steel with hydrogen, including one at Cleveland Cliffs, the largest manufacturers of iron-ore pellets in the country.
The U.S. is investing up to a billion dollars in green steel. And through the bipartisan infrastructure law, has also pledged seven billion dollars to fund seven hydrogen hubs around the country. Globally, there are ambitious plans for green hydrogen. Including hydrogen made from renewable sources in sub-Saharan Africa and from wind farms off the coast of France.
Rachel Fakhry: And that's a great kind of big vision. But then you double click on it and a whole suite of risks start to really come to the fore. How do you start scaling production of truly clean hydrogen? Which is still expensive today, especially compared to the dirty hydrogen we currently produce and use.
HOST: Subsidies and tax credits. Much like with solar, that’s how a lot of industry experts think green hydrogen could grow into its own.
Rachel Fakhry: Now with this subsidy, with that very large IRA subsidy, that could cover up to 90% of the cost of hydrogen production in some regions, then the cost of green hydrogen is projected to decline from roughly $4 or so today to, you know, a dollar. Even less than a dollar in some cases. So we are expecting with the subsidy that in many places in the U.S., green hydrogen costs could drop to somewhere closer to where today's dirty gas hydrogen is. At $1 per kilogram. The way it's going to work is this tax credit is going to drive a lot of hydrogen deployment. So the electrolyzer, which is basically the equipment where the water is split for hydrogen production, that's the electrolyzer. That's a very expensive cost component today.
Arielle Duhaime-Ross: Okay.
Rachel Fakhry: More you're going to kind of deploy of those owing to the tax credit, the more you're going to see some cost reductions.
Arielle Duhaime-Ross: I see. So innovation in the technology itself that's used to make the green hydrogen.
Rachel Fakhry: That's right. That's going to be probably the largest source of cost reductions between now and say the end of this tax credit — is going to be in the component of the electrolyzer itself.
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HOST: The hope is that the funding will give engineers and scientists a chance to improve the technology, and make the price of green hydrogen competitive with the dirtier kind. Basically the same feedback loop that lowered the price of solar power over the last decade.
One company making a big bet on the future of green hydrogen is Electric Hydrogen. Their plan is to build modular green hydrogen plants, centered on a proprietary electrolyzer. They think they can make green hydrogen viable.
Jason Mortimer: It's what the gas engineers call a slippery molecule.
HOST: That’s Jason Mortimer, Senior VP of Global Sales for Electric Hydrogen.
Jason Mortimer: It's really small, and it doesn't like staying put, and it's very hard to compress, but it can be done. And the technologies to do it are evolving super quick.
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HOST: Electric Hydrogen was founded by two former executives of one of the largest solar companies in the U.S., First Solar. The founders have also said that they hope green hydrogen can follow the trajectory of solar power. That bigger electrolyzers and better materials will drive down the cost of electrolysis.
Jason Mortimer: The company's heritage comes out of solar and specifically out of the time in solar when it went from sort of cool niche-y thing that cost too much, to the unquestioned low-cost source of marginal electricity around the world.
Arielle Duhaime-Ross: Mmhmm.
Jason Mortimer: And, what that creates is a tremendous abundance of available power. And one of the sort of reasons that we founded the company was to do something with that power. Right? We have to transform it because we can't always use all the solar energy where and when it's generated.
Arielle Duhaime-Ross: Right.
Jason Mortimer: But if I could put it in a machine and crack water and move the resulting gasses in a pipe, I could essentially power other parts of the economy on sunshine and wind.
HOST: The problem is cost. Right now, making hydrogen the clean way, using renewable energy, is four to five times more expensive than producing it using natural gas. In part because electrolyzers are expensive. But, Mortimer says —
Jason Mortimer: People have to take risk in the energy transition.
Arielle Duhaime-Ross: Mmhmm.
Jason Mortimer: And so how to do that properly is an ongoing debate. In fact the rules are still not written. And there are lots of would-be project developers in the U.S. today that are waiting on the rules before they can figure out if their projects are going to move forward. And so we're in a state of limbo here.
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Arielle Duhaime-Ross: Your industry doesn't exist in a vacuum. There are actually a whole bunch of moving pieces that you don't have that much power over that you're kind of hoping we'll all sort of come together at the right time to make this electrolyzer that you're doing actually efficient.
Jason Mortimer: Yeah. You said our industry doesn't exist in a vacuum. It doesn't even exist.
Arielle Duhaime-Ross: [chuckles] Good point.
Jason Mortimer: Right? Like we're we're doing the thing that hasn't been done at the scale that's never been imagined. And, you know, good for us, right? We still have to prove it, but we are collectively figuring out what's the right way to begin.
Arielle Duhaime-Ross: What phase are you at with this? Are you talking prototype? Has this thing been sold to, to companies? Is it actually being used in a steel plant?
Jason Mortimer: We have two operating plants today. They're both in California. We own them both as a company. They're there to demonstrate that the technology works and that you can come see it.
Arielle Duhaime-Ross: Okay.
Jason Mortimer: One of those is in San Jose, and it's ten megawatts and it's running right now. Making hydrogen gas. As I like to say, it makes three things. It makes heat, noise and gas that you can't see.
Arielle Duhaime-Ross: Right
Jason Mortimer: You have to take our word for it.
Arielle Duhaime-Ross: [laughs]
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Jason Mortimer: The first sort of customer-sided hundred megawatt product. That's going into Texas, and it's being built right now.
Arielle Duhaime-Ross: Oh wow.
Jason Mortimer: And the customer in that equation is a company called New Fortress Energy.
HOST: New Fortress Energy is a company that modernizes grids using Liquefied Natural Gas. They say they want Green Hydrogen to play a role in making them a major carbon-free energy provider.
Arielle Duhaime-Ross: So when you say ‘I don't really have an industry’, you really mean like legitimately you're about to have the first real world application —
Jason Mortimer: That's right.
Arielle Duhaime-Ross: — where it's a customer who bought into this system and is like trying to apply it to how they do things.
Jason Mortimer: That's right. It's either a phenomenal hype machine or it is the beginning of the end for, you know, phase one of the Industrial Revolution. Which is, ‘hey, turns out, all the good stuff we get from fossil fuels has a problem, and we're scaling up massively to fix it’.
Arielle Duhaime-Ross: Right. You’re betting on the latter scenario.
Jason Mortimer: Well, [chuckles] you’re betting on it. We’re all betting on it.
Arielle Duhaime-Ross: We all are. How much are these electrolyzers — your electrolyzers specifically — projected to to save companies compared to other green hydrogen tech out there?
Jason Mortimer: The sort of true north is called the levelized cost of hydrogen. And in our view, that's the only thing that matters. Which is, you know, what did a kilogram of hydrogen cost when it came out of the electrolyzer?
HOST: There are two components to cost. First, there’s the price of the electrolyzer, which Mortimer says has come down thanks to government subsidies and various design decisions they’ve made. The other is the cost of the power the electrolyzer runs on. And that’s been less predictable.
Jason Mortimer: There are parts of the world where it's cheaper and parts of the world where it's more expensive. And let's talk about some of those parts, right. So, somewhere between, call it like Abilene to Bismarck, up through the heartland of the U.S., there's an abundance of wind and solar. There's quite a lot of land, comparatively low cost renewable power.
Arielle Duhaime-Ross: Right.
Jason Mortimer: And, combined with a low cost electrolyzer, today, maybe you can make hydrogen for about three bucks a kilogram, or $3.50 a kilogram.
Arielle Duhaime-Ross: Okay.
Jason Mortimer: The equivalent cost of making that same kilogram from natural gas. Let's call that $1.50. So there's a $2 gap.
Arielle Duhaime-Ross: Right.
Jason Mortimer: And the big debate is like who pays that gap?
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HOST: For decades, hydrogen has been an energy solution in search of a problem. And even now, when its applications are becoming clearer and more narrow, there’s still a lot of work to be done to prove it’s worth the trouble.
Jason Mortimer: I would say fundamentally we as an industry have not yet earned the right to exist. We haven't built the projects to demonstrate that the technology works and that we can achieve the economics that we need. And we are doing that now.
Arielle Duhaime-Ross: Mmmm.
Jason Mortimer: People say, well, a green hydrogen is just just too expensive. Well, you know, so too is extinction. I love to characterize this as possibility.
Arielle Duhaime-Ross: Mmhmm.
Jason Mortimer: And a challenge. It’s a challenge for us as a company. It's a challenge for us as an industry. It's a challenge for us as a society.
Arielle Duhaime-Ross: Yeah.
Jason Mortimer: We have ways to do things differently. Do we have the will? And I'm betting that we do.
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HOST: On the final episode of season five of The World As You’ll Know It, we’re talking about direct air capture and the role it might play in our race to net zero.
Dr. Klaus Lackner: And so that then naturally led to the question, can I actually pull the CO2 back out of the atmosphere?
Dr. Susana Hovorka: So all these major energy companies see it as a future business. They’re seeing potential or certainty of decline in their fossil business. What are they going to do next? So abate everyone’s carbon is an attraction that uses their — repurpose their skills.
HOST: I’m Arielle Duhaime-Ross. We'll be back next week.
The World As You’ll Know It is brought to you by Aventine, a non-profit research institute creating and sharing work that explores how today’s decisions could affect the future. The views expressed don’t necessarily reflect those of Aventine, its employees or affiliates.
For a transcript of the episode and more resources related to what you've heard in today's episode, please visit Aventine.org slash podcast.
Danielle Mattoon is the Executive Director at Aventine. Bruce Headlam is the Editorial Director at Aventine.
This episode was produced by Alexis Moore, with support from Elliot Adler, Lisa Cerda, and me, Arielle Duhaime-Ross. Additional writing and producing from Bruce Headlam. Our Editor is Eric Mennel. Kamilah Kashanie is our Managing Producer.
Original music by Vera Weber and Davy Sumner, with additional music from Epidemic Sound.
This episode was mixed by Marina Paiz. Our recording engineers are Pedro Alvira, Hannis Brown, & Davy Sumner. Additional support from Sharon Bardales and Jade Brooks.
Research and fact checking by Will Tavlin. Creative direction and design by Curt Courtenay and Lauren Viera.
Music licensing by Extreme Music and Epidemic Sound.
Our Executive Producer is Je-Anne Berry.
Special thanks to Emerald O’Brien and Xandra Ellin.
I'm your host, Arielle Duhaime-Ross.
Make sure to listen to us on the Audacy app or wherever you get your podcasts.