23.05.2022, Bremen: Wind turbines stand behind photovoltaic panels at the block landfill. … (+)
Florida Power & Light (FP&L) is building a hydrogen hub that will blend 5% hydrogen with natural gas to supply its customers. Some of the solar-generated electricity will be fed into the grid, but the majority will power electrolyzers to produce green hydrogen. The ultimate goal is to offset the utility’s reliance on natural gas.
FP&L is making these investments because it expects significant long-term benefits. Heavyweights like FP&L are creating economies of scale as green hydrogen becomes increasingly profitable, driving the sector forward. However, the costs associated with clean hydrogen remain relatively high, especially as the infrastructure for its production, storage and distribution is still being built.
“Hydrogen complements FPL’s existing clean technology portfolio, which includes solar, battery storage, natural gas and nuclear,” the company said. “By starting small, we can leverage our learnings and see how we can apply them at scale.”
According to Dan Brumlik, co-founder of The Partner Companies, hydrogen is no longer just a theoretical concept. However, the fuel is spreading across various sectors such as energy, rail and vehicles. Although not all hydrogen produced is clean, efforts are being made to switch to green hydrogen and create a seamless transition to a green energy economy.
FP&L began construction of its Cavendish NextGen Hydrogen Hub in 2022 and will complete it in 2024. The hub uses solar energy to split water into hydrogen and oxygen. When renewable energy is used in this process, it is referred to as “green hydrogen,” as opposed to “grey hydrogen,” which is produced using natural gas. This project reflects the utility’s commitment to clean energy and its goal of achieving net-zero emissions by 2045.
The International Energy Agency’s Global Hydrogen Review 2023 points to a significant increase in low-carbon hydrogen projects. However, these ventures require significant investment, even though the cost of green energy has fallen by 85% over the past decade. The current focus is on achieving economies of scale for electrolyzers. The drive to net-zero emissions by 2050 is prompting policymakers to adopt rules to encourage and scale up investment in green hydrogen production.
In order to achieve the goals of the Paris Climate Agreement, the demand for fossil fuels must be reduced by 25 percent by 2030 and by 80 percent by 2050, according to the International Energy Agency.
Promising results
According to Alex Klaessig, senior director of hydrogen at S&P Global Commodity Insights, green hydrogen has faced economic challenges in the past. However, due to the increasing emphasis on decarbonization and climate change, the cost of producing hydrogen through electrolysis has dropped significantly, making it a more promising option.
In Los Angeles, a 1,800-megawatt coal-fired power plant in Utah is currently being converted to a plant that runs on green hydrogen. The plant will initially operate as an 840-megawatt natural gas-fired power plant that can also run on hydrogen.
The city plans to purchase a significant portion of the Intermountain Power Project’s output. The plant will convert from a coal-fired power plant to a combined cycle gas and steam power plant and eventually to a green hydrogen producer. The plant will also utilize existing transmission infrastructure and store excess hydrogen on-site in a salt cavern.
Numerous companies, including Adani Group, Air Liquide, Bloom Energy, Enbridge, FuelCell Energy and Shell, are involved in the production of green hydrogen. Several manufacturers, including steelmaker ArcelorMittal and fertilizer producer Yara, are now using green hydrogen to reduce carbon emissions. FP&L is one of the latest companies to use these technologies.
According to Scott Bekemeyer, co-founder of The Partner Companies, FP&L is making these changes for environmental and economic reasons; it may be the most cost-effective approach while utilities evaluate their fuel options. “We’ve turned the corner. We’re not just selling carbon reduction; it’s a smart business decision.”
Growing concerns about climate change have transformed the clean hydrogen economy from a new and untested concept to one that is now showing promising results. While challenges remain to be overcome, policymakers, technology providers and business leaders have set the stage for a path that could lead us to a net-zero future and a cleaner environment.
