Some energy experts warn that a deal to sell Canadian hydrogen to Germany will only be a small, distant and expensive part of the solution to Europe’s energy crisis.
Chancellor Olaf Scholz and Prime Minister Justin Trudeau will sign a hydrogen agreement next week during Scholz’s official visit to Canada in Stephenville, NL.
A government official, speaking on condition they would not be identified, confirmed a hydrogen deal will be signed, the culmination of months of talks between the two countries.
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Stephenville, a port city an hour south of Corner Brook on Newfoundland’s west coast, is the proposed home for a zero-emissions power plant that will use wind power to produce hydrogen and ammonia for export.
The Canada-Germany deal is expected to make fuel-hungry Germany the first major customer for a unique project in Canada.
Germany was already considering hydrogen as an energy solution in its climate plan before Russia invaded Ukraine last February. But since that invasion, as Russia tries to resist punitive economic sanctions, it has repeatedly threatened Germany’s energy supply.
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Germany typically gets about half of its natural gas from Russia and is looking at short- and long-term solutions to wean itself off of Russian exports.
Proponents say the hydrogen deal comes at a crucial time for Canada’s green hydrogen industry, which is still in its infancy.
However, some experts also say that the young product has a high price and Germany cannot help in the short term. Canada does not yet have the infrastructure to produce large quantities of green hydrogen or to export it long distances.
“The key is that a lot of related infrastructure needs to be built before we can export hydrogen to other countries on a large scale,” said Amit Kumar, chair of industrial research for the Natural Sciences and Engineering Research Council.
Transport would likely require the hydrogen to be cooled to a liquid, loaded into a specially adapted pipeline or tanker, and reheated at the destination.
The process and infrastructure are expensive, as is production.
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Most of the world’s hydrogen production comes from converting natural gas into hydrogen and carbon dioxide. When the latter is emitted into the atmosphere, the hydrogen is referred to as “grey”. In Canada, the goal is to intercept these emissions through carbon capture and storage, which would make the hydrogen ‘blue’.
Canada has so far expressed plans to help Germany with new natural gas projects in Atlantic Canada that could one day convert to blue hydrogen plants.
But Germany is primarily looking for “green hydrogen”, which is produced by splitting water molecules using renewable energies such as wind or solar power. That comes at a much higher price.
“You’re looking at a three- to four-fold increase in costs,” said Kumar, a professor in the engineering department at the University of Alberta who was consulted on the development of Alberta’s hydrogen strategy.
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He said the technology needs to improve and more investment needs to be made before the cost is even remotely comparable to the natural gas-derived alternative.
The company behind the Newfoundland project, World Energy GH2, said the first phase of its Newfoundland project will build up to 164 onshore wind turbines to power a hydrogen production facility. Long-term plans call for a tripling of the project size.
In its proposal, World Energy GH2 said it is at the forefront of a new, green industry.
Construction of the first wind farm is scheduled to begin next year. That means hydrogen production is a long way off, said Paul Martin, chemical engineer and co-founder of the Hydrogen Science Coalition.
“It’s going to take years and years and years,” he said. “And then you have the infrastructure problem.”
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Martin says the infrastructure costs of producing and transporting green hydrogen don’t add up.
“Honestly, it’s frivolous to sell green hydrogen in Canada for export,” he said.
That’s partly why Canada’s hydrogen strategy includes transitioning to “blue hydrogen” before eventually switching to green, Kumar said.
However, Germany’s strategy clearly favors green hydrogen, while the role of blue hydrogen is uncertain, according to an analysis by Isabelle Huber, fellow at the Center for Strategic and International Studies.
Trudeau and Scholz, who became Chancellor in December, first spoke about hydrogen and Canadian energy exports when Trudeau visited Berlin in March.
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At the G7 leaders’ summit in the Bavarian Alps in June, Trudeau spoke at length with other world leaders about how Canada could offer alternatives to nations dependent on Russian oil and gas.
At a press conference concluding the summit, Trudeau suggested that the infrastructure used to transport liquefied natural gas could be adapted to transport hydrogen, as an example of how Canada could help.
“We also aim to expand some infrastructure in the medium term,” Trudeau said, “but in a way that meets the medium and long-term goal of accelerating the transition — not just of Russian oil and gas — but of our own dependence on fossil fuels.” fuels.”
Canadian hydrogen could be just part of Germany’s plan to switch to German gas in a very difficult situation, said Sara Hastings-Simon, who leads the Master of Science in Sustainable Energy Development at the University of Calgary.
“It’s not the be-all and end-all, it won’t completely fix it, nor will it be the only answer,” she said in an interview.
— With files by Mia Rabson
© 2022 The Canadian Press
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