A Profitable, Clean Tech Solution to Grid Congestion in China
As China's economy rapidly grows, the energy sector faces two major challenges: an imbalance of supply and demand and a lack of distribution and transmission infrastructure.
As by far the largest wind power market in the world (with 63 GW installed capacity), China gets more than 30% of its wind market's revenue from federal subsidies—an exceptional amount of support from the government that has adversely caused a massive oversupply issue. In 2011, abandoned wind power amounted to over 10 billion KWh, exceeding 50 percent of the industry's profit. Much of that energy was wasted, mostly positioned near farms lacking sufficient distribution/transmission infrastructure capable of moving excess energy to areas of higher demand.
Heavy Industry for Heavy Power Offtake
Due to the large demand for electricity to power large manufacturing facilities, many companies opt out of expensive utility power to produce electricity using on-demand generation techniques.
Unfortunately, wind power is not currently an option for most energy-intensive industries, because wind farms are mostly located in remote areas, lacking labor and other resources to transport the power. Building the necessary transmission cables to do so could cost an upwards of billions of dollars.
Hydrogen generated power, however, offers a prime opportunity for the country's large facilities.
Clean Hydrogen: A New Fuel Infrastructure
Hydrogen manufacturing, using electrolysis, has been implemented at many large power generating stations throughout the world. First researched and implemented by Norsk Hydro of Norway in 1923 at a large hydroelectric facility, hydrogen generation using a power generating facility’s extra power became a highly profitable means of utilizing what would otherwise be a wasted resource.
In China, hydrogen creates an opportunity to monetize an asset that currently is nothing but a financial burden. Rather than curtailing wind capacity (shutting down turbines when over-producing), onsite hydrogen generating plants could be implemented to utilize the energy created by free wind power. Wind farms’ extra electrical capacity can be stored as hydrogen gas for later use as demanded and converted from H2 into electricity by a fuel cell. This system can range in size from a few kilowatts in capacity (for a residence) up to several megawatts (for a town or grid substation).
As fuel cell technology continues to advance, the Chinese could very easily create the fuel supply for a completely clean and cutting edge energy infrastructure.
Hydrogen Economy in China
One of the biggest barriers to a hydrogen economy is that it necessitates a large amount of energy to create the fuel. Hydrogen is 100 percent clean when burned and extremely energy intensive (about 3x more powerful than natural gas by mass). Unlike natural gas, however, hydrogen is not readily found in nature and must therefore be processed using energy-intensive mechanical or chemical processes, driving up costs. (An average hydrogen producing electrolyser needs about 4.5kWh of electricity to produce 1 m3 of hydrogen gas).
Therefore, producing hydrogen may require the use of electricity generated from unclean sources like natural gas, coal, nuclear, etc. The environmental opportunity that presents itself to China's wind energy market for creating a new revenue stream via hydrogen is exceptional. The glut of renewable energy capacity could potentially create a significant amount of high value, clean hydrogen gas at minimal expense. Operating costs would be limited to the inexpensive maintenance of facilities, while the cost of excess wind to power the generation of hydrogen would amount to zero.
A Long-Term Investment
A separate concern with hydrogen networks is the initial capital requirement for a roundtrip hydrogen system to create, store, and convert hydrogen back to electricity. Per unit of energy, a hydrogen system is more expensive than electricity generating equipment for natural gas plants or other fossil fuel plants. That’s why it is especially beneficial to look into pathways leading to the direct use of hydrogen gas in the chemical, fertilizer and mechanical industry.
Beyond the environmental benefits and the economic incentive of a zero operating cost fueling infrastructure, hydrogen systems have an extensive lifetime that could last past 50 years (over 20 years for fuel cells). That long-term payoff makes a hydrogen generating system a much more attractive option for solving a supply/demand imbalance for large scale energy systems compared to the alternatives.
Considering these new opportunities, China could change the face of its remote and rural communities. With a large supply of hydrogen fuel, the applications in energy, transportation, and chemical/industrial/manufacturing will undoubtedly raise standards of living and generate growth, minus the environmental destruction that usually coincides with economic expansion.
VERDE LLC is a technology manufacturer based in Braintree, MA, specialized in designing and deploying residential, commercial, and industrial scale electrolyzers used for: renewable energy storage, industrial processing, transportation fuel, natural gas plant peaking, and distributed generation.
HyNet North West and InterGen to build Zero Carbon plant
Expected to begin in the mid-2020s, the partnership could reduce the CO2 emissions from the Runcorn power station by over 150,000 tonnes each year, the equivalent of taking 60,000 cars off the road every year.
Situated across one of the UK’s largest industrial areas which supports the highest number of manufacturing jobs of any UK region, HyNet North West will bring clean growth to safeguard jobs, and create thousands of new employment opportunities.
Following a commitment of £72 million in funding, HyNet North West will transform the North West into the world’s first low carbon industrial cluster, playing a critical role in the UK’s transition to ‘net zero’ greenhouse gas emissions by 2050 and the global fight against climate change.
HyNet North West will begin decarbonising the North West and North Wales region from 2025, replacing fossil fuels currently used for electricity generation, industry, heating homes and transportation with clean hydrogen. The project will also capture and lock up carbon which is currently emitted into the atmosphere.
It anticipates that by 2028, Rocksavage will have enough hydrogen produced by HyNet to move towards a 100% net zero power generation power station as the Gas Turbine technology becomes available.
InterGen’s Rocksavage Plant Manager Dan Fosberg said Rocksavage has been safely generating energy to power the north west for nearly 25 years, but in order to meet the UK’s net zero targets, traditional generation needs to adapt.
"HyNet North West will allow us to pivot our operations as we transition to a low-carbon world. The proximity of the Rocksavage Power Plant to the HyNet North West hydrogen network provides us with an exciting and unique opportunity," he said.
As soon as the first stage of the hydrogen network is available at Runcorn, InterGen intends to modify the existing generating plant to consume a blend of hydrogen with natural gas and start to reduce our emissions.
The HyNet North West project milestones mean that Rocksavage could be the first plant in the UK to blend Hydrogen with natural gas, a step forward for the industry in the target for net-zero. Once the gas turbine technology becomes available, it will explore options with HyNet North West to create a zero emissions power station using 100% hydrogen.
The project will play a big part in supporting Liverpool City Region in its commitment to reach zero carbon by 2040 and accelerate the UK’s transition to net zero by 2050.
Steve Rotheram, Metro Mayor of Liverpool City Region, said: “Putting the Liverpool City Region at the heart of the Green Industrial Revolution is one of my top priorities. With our existing strengths in green energy, we have the potential to become the UK’s renewable energy coast.
“I am committed to doubling the number of green jobs in our region and exciting projects like HyNet will be a key part of that. We’re going to lead the way, not only in doing our bit to tackle climate change, but in pioneering new and innovative technology that in turn attracts more jobs and investment to our region.”
David Parkin, HyNet North West Project Director, said HyNet North West will play a big part in tackling climate change regionally. "It will ensure the region remains an attractive location for investment and for companies to grow through the establishment of a clean economy, protection of skilled jobs and creation of thousands of new long-term employment opportunities.
“Our partnership with InterGen at Rocksavage shows just how great an impact HyNet will have on the region – decarbonising homes, workplaces, travel and industry.”
HyNet North West is a low carbon energy project at the forefront of the UK’s journey to a Net Zero future, being developed by a consortium comprising Progressive Energy, Cadent, Essar, Inovyn, Eni, University of Chester, CF Fertilisers and Hanson.