Hydrogen as a future energy source in Western Canada

November 23, 20215:18 AM BOE Report Staff

The level of industrial interest in hydrogen as a future energy source has grown dramatically.  Pathways for generating, and utilizing hydrogen are being investigated by many operating companies as solutions toward satisfying decarbonization ambitions, and longer-term net-zero goals.

During the past year, Fluor Canada and GoobieTulk Inc. (GTI) have performed an in-depth review of hydrogen as a future energy source in Western Canada.  The business case success criteria for using hydrogen as a future energy source was centered around five key attributes.  These were 1) a meaningful reduction in greenhouse gas emissions, 2) the potential for immediate technology implementation, 3) the use of proven world-scale hydrogen production plants, 4) an acceptable cash-cost of hydrogen production and 5) standalone competitiveness as a source of alternative energy.

The review involved comparing different hydrogen manufacturing technologies – steam-methane reforming, autothermal reforming and electrolyzer-produced hydrogen as alternative pathways to hydrogen production.  Autothermal reforming presented the most compelling arguments; economy-of-scale production rate, de-risked technology, lowest cash-cost of operation and highest carbon capture rate, to name a few.

Additionally, the review encompassed potential Alberta hydrogen markets, such as using hydrogen as a transportation fuel, as an alternative to natural gas, replacing current “grey” hydrogen with “blue” hydrogen, the blending of hydrogen into West-coast LNG supply (i.e., natural gas) pipelines and considerations around using hydrogen for West-coast ammonia and methanol production.29dk2902l

Several conclusions are outlined in the report, however, one compelling conclusion stood out.  A business case exists to continue with the development of an Alberta-based project – to use hydrogen as a future energy source in Alberta, having potential to replace traditional transportation fuels.  The compelling storyline satisfies the business case success criteria on several fronts, these being, 1) the ability to capture 96% of the CO2, 2) the potential for immediate technology implementation, 3) proven, de-risked world-scale hydrogen production, 4) the lowest quantity of natural gas required per gigajoule (GJ) of hydrogen produced, and 5) practically the lowest-cost hydrogen production location in the world.

The headwinds to this pathway relate to the nascent hydrogen transportation fuel market in Western Canada.  Relative to the scale of demand for conventional transportation fuels, demand for hydrogen as a transportation fuel does not currently exist.  A catalyst is required to enable this market to evolve in Western Canada.

As noted in the recently released Alberta Hydrogen Roadmap, Alberta has the potential to be a supplier-of-choice for clean hydrogen as a transportation fuel once zero-emission vehicles are more widely adopted.

David Mercer
Director, Head of Technology – Energy Solutions, Fluor Canada