By Lucien Joppen
In 2022, Wunsiedel, Germany, will feature one of the largest green hydrogen production facilities in the world. The facility is designed to produce 1,350 tons of green hydrogen per year, with the aim of expanding to 2,000 tons p/a. The facility is also important as it should demonstrate the economical and technological feasibility of green H2 production.
The plant in the Bavarian town, which will commence operation in the summer of 2022, should offset carbon dioxide production by 13,500 tons per year. With an electrical capacity of 8.75MW, the facility will be one of Germany’s largest hydrogen power plants, and will provide power to parts of Germany and Czechia.
In July 2021, Siemens held a ceremony to com-memorate the start of construction. During the ceremony, Siemens CFO, Professor Dr Ralf P Thomas, stated that “converting our energy supply to new, climate-neutral energy sources is one of the main objectives of the energy transition. Hydrogen plays a key role in this. In this respect, Wunsiedel, with its existing distributed energy system and the use of digital technology, is a lighthouse project for a sustainable energy future.”
The Wunsiedel facility is jointly owned by Siemens and the German gas company Rießner Gase, each good for a 45 per cent share, the remaining 10 per cent owned by Stadtwerke Wunsiedel, a local public works body. Apparently, public-private partnerships are needed – at least in this case – to get a project off the ground, also given the financial risks (more about this later).
“WUN H2 is a pilot project for Germany that will demonstrate innovative technology in practice and ultimately prove the feasibility of industrial production of green hydrogen,” said Dr Philipp Matthes, managing director of the Wunsiedel plant. “Our concept is scalable and can easily be transferred to other locations. If every city had its own H2 plant, the energy transition would already be much further along.”
The owners of the plant have opted for PEM-electrolysis to split water into oxygen and hydrogen. PEM, or proton-exchange membrane, allows protons to pass through but stops gases such as hydrogen or oxygen. In an electrolytic process, the membrane functions as a separator, among other things, and prevents the resulting gases from mixing. Compared to traditional alkali electrolysis, PEM technology is ideally suited for utilizing fluctua-ting wind and solar electricity because of its highly dynamic method of operation, Siemens states.
“For the first time, the oxygen and the low-temperature waste heat generated during production are planned to be reused by nearby industrial operations. This will result in maximum energy efficiency and a plant that is unique because all element flows will be utilized. In addition, electrolysis is an important building block toward implementing our municipal energy strategy, where we make sustainably energy use and climate protection a reality,” explained Marco Krasser, CEO of SWW Wunsiedel GmbH.
Battery storage facility
The site of the green H2 plant in Wunsiedel will also feature a 100MW battery storage facility. Both Siemens Smart Infrastructure and Zukunftsenergie Nordostbayern GmbH have together signed a letter of intent (see image bottom of text) for the turnkey con-struction. The plant, with a storage capacity of 200MWh, is intended to use surplus renewable energy and cover demand peaks in the power grid.
The facility is capable of supplying 20,000 typical households with electricity for a year. The lithium-ion battery storage system (5,000 square-metre energy storage) will be provided by Fluence, a joint-venture between Siemens and AES.
“Electricity storage facilities are an important building block for shaping the future of energy,” said Krasser, as mentioned before MD of SWW Wunsiedel GmbH, one of the partners in Zukunftsenergie Nordostbayern GmbH. “They can help stabilise the grid and make better use of energy generated from renewable sources. They draw surplus power from the grid and feed it back when electricity demand is higher. Smart storage technology will increase the local and national supply of green power. That is why we are gradually expanding the capacity.”
H2 integral part of Green deal EU
In 2020, the European Commission adopted a new dedicated strategy on hy-drogen in Europe. This strategy will bring different aspects/disciplines (research and innovation, production, infrastruc-ture etc) and ‘explore how producing and using renewable hydrogen can help decarbonise the EU economy in a cost-effective way, in line with the European Green Deal.’
The EU views hydrogen as an important pillar under the zero-carbon foundation as certain sectors are likely to remain reliant on combustible fuels. ‘This means that the EU’s carbon-neutral ambition is unlikely to be achieved by the greater use of electrification alone. One potential solution is to convert renewable energy sources into hydrogen, as the processed hydrogen provides high-grade heat that can be used in transport as a fuel, in in-dustries as a material and in agriculture for fertilisers.’
The EU states that ‘cumulative invest-ments in renewable hydrogen in Europe could be up to ¤180-470 billion by 2050, and in the range of ¤3-18 billion for low-carbon fossil-based hydrogen’. These investments will be made both by the public and the private sector.
As for the capacity of the H2 plant, the initial output will be roughly 900 tons of hydrogen per year in this first phase. When fully expanded, it will be able to supply up to 2,000 tons.
As mentioned before, the Wunsiedel plant should also offer a blueprint for scaling up hydrogen production, making it more cost-competitively with other forms of hydrogen production. With any relatively new technology, scaling up is critical to survive the valley of death. This is also the case with green hydrogen production. Going from small-scale demonstrations of viability to large-scale industrial processing involves a transition from purely scientific and technological challenges to logistical, economic and, in some cases, political ones. In the case of green hydrogen, investments also are needed in the energy infrastructure, from energy storage (see box text Battery storage) and industrial heating to vehicle fuel and shipping.
Within the EU and in several EU countries, hydrogen-related projects are co-funded with public money to take away some of the risks associated with early development.
In the case of Germany, the national government has given green hydrogen a prominent place in its roadmap towards carbon neutrality. With its “Climate Protection Plan 2050”, Germany should become largely greenhouse gas-neutral. To achieve this, all energy-consuming sectors such as transport or industry are equally challenged to successively reduce their CO2 emissions.
Given its capacity to harness renewable energy (mainly solar and wind), hydrogen would be able to address the discontinuity of these renewable energy forms. It can also be produced in a climate-neutral manner from renewable sources such as photovoltaics (PV) and wind power. The gas thus offers the possibility of storing and transporting large amounts of energy. This is particularly useful when – for example on sunny and windy days – there is temporarily more electricity from renewables available than is currently needed.
Apart from being an energy carrier, hydrogen is also used in various industries as a feedstock. Whether in refineries, metallurgy, steel production, chemical industry or chip production, the gas is indispensable in many processes.
In the transport sector, hydrogen can also serve as an emission-free fuel – and not just for cars with fuel cells. In the meantime, buses and even trains in local transport are powered by hydrogen.
The use of climate-neutral hydrogen or synthetic fuels produced on the basis of hydrogen could also be an alternative in the future for heavy haulage, shipping and air traffic. In the case of Wunsiedel, a public hydrogen filling station for trucks and buses may be added later at the same location to aid the conversion of heavy-duty traffic and public transportation to CO2-free drive technology.
This brings us to the regional hydrogen market around the municipality of Wunsiedel. The H2 plant aims to service these markets (northern Bavaria, Upper Franconia, the Upper Palatinate, southern Thuringia and Saxony, as well as Western Bohemia (Czech Republic)). The plant aims to transport green hydrogen in gas cylinders to industrial customers. According to plant management, this regional approach saves time and cost compared with grey hydrogen which has to be shipped from greater distances. However, grey hydrogen – as it stands now – is far cheaper than green hydrogen, which makes up the bulk of hydrogen production. Figures from the International Energy Agency (IEA) found that the cost of producing green hydrogen could reach $3 to $7.50 per kilogram, which is more than three times the cost of grey hydrogen.
Depending on the scalability, technological advance and policy support, these costs are expected to go down. A key price threshold for renewable hydrogen to become widely adopted, in the minds of industry and energy researchers, is $2 per kilogram. (source: BloombergNEF). BloombergNEF also published a report in 2021, which states that green hydrogen will become cheaper than blue hydrogen (natural gas combined with CCS). By 2050, green hydrogen will be even cheaper than grey hydrogen (67 dollar cents per kilogram in the U.S., compared to $1.19/kg for grey hydrogen).
Given the above timeline, green hydrogen from Wunsiedel in the short term will have a difficult time competing with grey hydrogen, unless the national government bridges the price gap by policies such as an increase in CO2-taxation.
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