|Welcome to Econ 050: Economics and business that matters to the Netherlands and the world. In each episode, Northern Times editor Traci White interviews a new expert about everything from trade wars to the psychology in your shopping cart. This podcast is a co-production between The Northern Times and the Faculty of Economics and Business of the University of Groningen.|
Natural gas has been the Netherlands’ blessing and Groningen’s curse in recent decades. Even as quotas are reduced ever further, earthquakes induced by natural gas extraction continue to jolt the province on a nearly daily basis. But the country and the world need energy, and professor Ad van Wijk from TU Delft believes he has at least part of the solution: green hydrogen.
Professor van Wijk helped to developed an extremely ambitious plan to convert the northern Netherlands into a green hydrogen hub, from production to distribution and transportation – but how plausible are those plans, and how much will they cost? We sat down with professor Van Wijk to hear more about this up-and-coming energy carrier and what it could mean for the north.
What are grey, blue and green hydrogen?
Ad van Wijk: You can make hydrogen from the fossil fuels like we do today, from natural gas for example, by steam methane reforming which is the technology then, or by coal gasification and then we’ll make hydrogen, but that’s called grey hydrogen. So there, you release the carbon dioxide into the atmosphere and therefore it contributes to greenhouse effect
The other terms that you can use, you can produce it from natural gas or coal and then you get to the carbon dioxide to use towards something somehow an empty gas field, and then it is called blue hydrogen. But what we what we want to discuss of course is can we produce hydrogen from renewable resources, from solar and wind. And then first, we produce electricity with solar cells or wind turbines, but then we convert the electrolysis of water. So we have water as a resource. You could say we put in electricity and then the water molecule is split into hydrogen on the one side and oxygen on the other side.
Then the technology is electrolysis and you produce green hydrogen. But you can also produce green hydrogen from bio gas the same technology that you use for natural gas-making, and then it is called also green hydrogen. So the resource defines whether or not it is clean or grey or eventually blue hydrogen. And today of course we are talking about green hydrogen because we want to have a carbon-free hydrogen resource. And why do you want to do this? Because you have solar electricity, and why don’t you want to use it directly or why are you not going to use it directly?
How can industries and sectors use green hydrogen?
Van Wijk: It’s a feedstock, but you can use it also to produce high temperature steam in the industry, for example. When you want to make paper, you need a lot of high temperature heat. Or when you want to process your milk or whatever, then you need this. So in these industries, you can use it. In the chemical industry, you can use it, but then you can use it also for electricity production, so normal power plants can be converted to a power plant that uses hydrogen instead of natural gas, for example. But the new application is of course mobility, and there the new technology you see is now emerging it called a fuel cell, and the fuel cell is a chemical process to combine the hydrogen with the oxygen from the air into electricity, and then you produce electricity again and clean water.
What is the green hydrogen economy plan for the north?
Van Wijk: What we have seen here in the northern Netherlands, that is of course we have our gas production here, our natural gas production and we have a very large gas field here, the Slochteren field here in Groningen. But we have decided to reduce to zero the gas production by 2030 here in the northern part of the Netherlands. And that was not because of climate issues, but it was especially because it caused little earthquakes. And of course houses were [damaged] and we have to restore them, so therefore we have decided to reduce the natural gas production. But the next issue is of course about 20,000 to 30,000 people work in this industry in this area, in Drenthe and Groningen especially. So if you look to these numbers, what do these people have to do after this? So we investigated what is going on here and to see that we have a fairly strong chemical industry, which was of course built on the cheap gas that we had. So we have a large methanol plant. What are you doing when you produce methanol? First of all, you produce from a natural gas a synth gas with a lot of hydrogen in it, and then you combine it to methanol in another way. But you can also produce this methanol from hydrogen and carbon dioxide. So, you saw already hey, if we don’t have the gas anymore, how do we produce with this plant? This is an alternative for methanol production, to use the hydrogen in this case. But also you see that the natural gas infrastructure, which starts more or less here in Groningen, and then the gas infrastructure goes all the way to Europe. And we can use that to transport the hydrogen into that.
How much will these plans cost?
Van Wijk: We have just heard that the investment plan for the coming five to ten years has been released here in the Northern Netherlands, and that is an investment of 2.8 billion euros for three very large projects. We have to retrofit one these gas pipelines backbones, that cost you in general 1.5 billion, but then you have a capacity in one pipeline that is half of the capacity of the total electricity grid. So relatively, that is much cheaper when you want to do that. And the other large part of the cost is investments in blue hydrogen. Large-scale production site at the Eemshaven and then green hydrogen large scale hydrogen production at the Eemshaven and Delfzijl. Those are costs, but they are not really costs, they are really investments, and that means that you can earn it back.
On criticism of hydrogen’s efficiency:
Traci White: In a previous episode that we’ve done of the podcast about what happens in the north after natural gas extraction ends, our guest Professor Machiel Mulder had talked about the fact that hydrogen is currently not available on a broad enough scale to be a viable, immediate replacement for it for natural gas. What is your response to that?
Van Wijk: I have seen his reports, but today we are much further in our technology development. We have much higher efficiencies on the electrolysers, we know how to retrofit our pipelines et cetera. He is looking especially in the literature, and as a scientist you have to look in the literature of course, but in fast developing technologies, you see that the literature is always too conservative and not adequate. So his estimates for the full cost of hydrogen are much too high. That’s not what we see today in the markets.
Which comes first: infrastructure or production?
Van Wijk: You only have to change the first pipeline at once and then you still have 4 or 5 big pipelines with natural gas that can go. But that has to be done as soon as possible, but only then you can produce. And you can have consumption and not at one place which is now the occasion, because the industry now is producing the hydrogen from natural gas at the place where they consume it, so they don’t need an infrastructure. When you have multiple consumers, like you do with natural gas, then of course infrastructure is the only thing that you have to realize. If you don’t do that, nothing will happen, or not on a large scale. That’s also what they do in Germany for example with hydrogen fuelling stations. They are going to build for all of these hydrogen fuelling stations up to 2023. And then you will see the cars will come, but nobody will buy a car with hydrogen when you can’t fuel it. It’s not a chicken and egg problem: first the infrastructure, then the cars.