Hydrogenating Storage

In today’s blog we are following up on our conversation about the potential uses and value streams that hydrogen provides. Refer to our first blog Hydrogen: a key player in the net – zero race

In our race to net-zero, one of our main constraints is the intermittency of renewable energy. As you may have heard, the “sun doesn’t always shine, and the wind doesn’t always blow.” In other words, it is well known that renewables do not have the same characteristics as fossil fuels to generate a consistent and dispatchable electricity supply.

Another feature of electricity markets is that supply and demand must at all times be equal, that is, every minute, every second of every day. Of course, deficits occur and are not ideal, but when surplus exist, we ideally want to manage this oversupply with storage mechanisms.

Experts do not dispute that battery systems (e.g., lithium-based) provide a solution for storing energy that can be deployed when required (e.g., electricity from solar energy on cloudy and rainy days). As an example, lithium-based batteries have become more popular than lead-acid batteries because they have a longer lifespan, can store more energy, and are more efficient (1).

Hydrogen, however, provides wider advantages in terms of scale and uses compared to lithium-ion batteries. For example, for electric vehicles (EVs), hydrogen (as fuel cells) has a far greater energy storage density than lithium-ion batteries, which offer EVs an opportunity to become lighter and occupy less space. Thinking bigger, hydrogen storage for the electric grid means having available fuel to store for weeks and at different times of the year!

Now a fair question to have is: how do we create hydrogen?

Hydrogen is created through electrolyzers (2). Electrolysis is the process of using electricity to split water into hydrogen and oxygen. Hydrogen burns like natural gas without carbon dioxide emissions, can be produced by separating water molecules using electricity (3).

Conventionally, hydrogen can be stored in 4 main ways (refer to the DOE (4) for an alternative disaggregation of mechanisms):

1. Geological storage. Hydrogen can be stored in salt caverns or depleted oil and gas fields and aquifers.
2. Compressed hydrogen. Like any gas, hydrogen can be compressed, stored in tanks, and used as needed. As a gas, it typically requires high-pressure tanks (350–700 bar [5,000–10,000 psi] tank pressure). Moreover, hydrogen’s volume is much larger than other hydrocarbons (4 times that of natural gas).
3. Liquified hydrogen. Some applications require hydrogen volume to be reduced further than with compression; therefore, it is liquified. Here, hydrogen has to be cooled at almost absolute zero (-253°C) and stored insulated so it can maintain this temperature and minimizing evaporation.
4. Materials-based storage. This type of storage uses solids or liquids that absorb or react with hydrogen to bind it. A typical example is ammonia. Perhaps you have heard of it? If not, you may like this article. Compared to liquified hydrogen, its energy density is nearly double, making it easy to transport and store.

Finally, what we can say about hydrogen storage is that physically and chemically, it is a viable solution. Nevertheless, the approaches cannot only consider the technical possibilities, but also whether it is economically viable and efficient.

Earlier in this article I stated that the intermittency of renewable energy is one issue we need to solve, and hydrogen “potentially” assists with the matter of storage. I use the word “potentially” because, hydrogen storage requires being technically (and lines above prove that) and economically viable.

For it to be considered economically viable, the imperative is to look at aspects of the cost structure: costs of electrolyzers, storage facilities, and environmental and social impacts (e.g., water and land). Round trip losses are witnessed in every part of the conversion chain, from breaking the molecular bonds of hydrogen and oxygen to burning hydrogen in turbines, which implies delivering less energy than the starting point.

Our next blog in the series takes a look at a hydrogen economy with Inflation Reduction Act 

1. Power Sonic. The Complete Guide to Lithium versus Lead Acid Batteries. https://www.power-sonic.com/wp-content/uploads/2019/04/Lithium-Vs-lead-acid.pdf
2. Hydrogen Production: Electrolysis. U.S. Department of Energy. https://www.energy.gov/eere/fuelcells/hydrogen-production-electrolysis
3. Meyer & Thomas, (2021). Hydrogen: the future of electricity storage? Financial Times. https://www.ft.com/content/c3526a2e-cdc5-444f-940c-0b3376f38069
4. Hydrogen Storage. U.S. Department of Energy. https://www.energy.gov/eere/fuelcells/hydrogen-storage

Please use links below to find out about Pivotal180 and our financial modeling courses and  experience the Pivotal180 difference.

• Project finance and infrastructure financial modeling
• Renewable energy project finance modeling
• Tax equity modeling
• Introduction to Battery Storage