Is hydrogen N.L.’S next big energy boom?

Anyone paying attention to the plans for renewable energy in the province is probably quite familiar with the potential for hydrogen in Newfoundland and Labrador.

It was mentioned dozens of times in the province’s renewable-energy plan and appears to be an integral part of its energy future.

With a growing demand for clean hydrogen worldwide, most notably by the European Union, which has plans to be climate-neutral by 2050, companies from around the world have shown up on the doorstep of the province, hoping to set up shop.

Hydrogen as a fuel is nothing new, having been produced from fossil fuels for more than a century. Known as grey hydrogen, it’s the least renewable form of hydrogen, but in recent years other forms have popped up, known as blue or green hydrogen.

Larry Hughes, a professor at Dalhousie University who specializes in energy systems and a founding fellow of Maceachen Institute for Public Policy and Governance, said the main current sources of hydrogen are coal and natural gas, with about 75 per cent of the hydrogen produced in the world coming from natural gas, in large part from Russia.

“The trouble with hydrogen from natural gas and coal is the process that’s used, the feedstock itself, coal or natural

“If the electricity comes from a coal-fired power station, you’re not really gaining that much.” Larry Hughes Dalhousie University

gas, makes it carbon dioxide intensive,” Hughes said. “It’s the carbon dioxide that’s the issue when making hydrogen fossil fuels.”

Blue hydrogen still uses natural gas, combined with carbon-capture technology, and green hydrogen, which is what has been mostly bandied about in Newfoundland and Labrador, can be created using renewable forms of energy such as wind or hydroelectricity.

Essentially, Hughes said, for green hydrogen, electricity would be run through a device known as an electrolyzer, which breaks water down into hydrogen and oxygen molecules.

“What you wind up with then is a source of hydrogen and then the question is, where does the electricity come from? If the electricity comes from a coal-fired power station, you’re not really gaining that much. If it comes from a hydroelectric station or a nuclear power station, for that matter, you’re getting zero-emission electricity, which means you’re getting a clean source of hydrogen.”

Hughes said with the hydroelectric capacity of the province, combined with the potential for wind energy, on paper Newfoundland and Labrador may be one of the most attractive places in the world for hydrogen production. That being said, he doesn’t believe that jumping right in would be the most prudent move for the province.

“My argument has been for Newfoundland and Labrador to go to hydrogen would be to set up a small project first, to demonstrate that it was possible and get people to buy into it, rather than building the world’s largest green hydrogen project,” he said.

PROVINCE ATTRACTIVE

Kieran Hanley, chief executive officer of econext (formerly known as the Newfoundland and Labrador Environmental Industry Association) said they’ve also been seeing growing interest in the hydrogen potential for the province in recent years. The not-forprofit organization is a founding member of the Atlantic Hydrogen Alliance and was part of a feasibility study in 2021 on hydrogen production, storage, distribution, and use in Newfoundland and Labrador.

Hanley said even though the study, which highlighted the opportunities in the province, was only released last year, a lot has changed since then to make the region even more attractive to investors, including the province releasing its renewable-energy strategy and legislative changes that allow wind energy projects.

Hanley said there several factors beyond the wind and hydro resources that make the province viable as a hydrogen producer.

“We’re on major shipping routes, trading routes, we have port infrastructure and our workforce and the infrastructure that’s been required for our oil and gas industry over the years,” he said. “It positions us really well. We’re a place that’s used to working on big energy projects. A lot of the know-how, a lot of the expertise, is already here. All of that combined presents a really compelling case for the province to be a leader in hydrogen production, mostly for export.”

The global shift and intensification of efforts in tackling climate change has been a huge driver of the interest, he said, and isn’t going away soon.

Green hydrogen is the most costly form of hydrogen to produce, but Hanley said the price is coming down and is expected to be on par with blue hydrogen in the next decade.

GOOD OPPORTUNITY

Industry, Energy and Technology Minister Andrew Parsons said the the government has seen increasing interest in the province’s hydrogen potential.

He said there have been companies looking at the province as a hydrogen source for years and it’s only gotten more common since the province unveiled its renewable-energy plan in December 2021 and announced changes to legislation to allow wind energy projects.

“That’s really sparked more of a recognition that it’s not just talk, we’re doing stuff to make this happen,” Parsons told Saltwire Network. “We’ve got over a dozen different companies that have reached out to us for different reasons, or different opportunities and different purposes. Some is about our own grid, some is about export, some was about cogeneration or for their own needs.”

Parsons said exporting hydrogen would be a big part of the future of the industry in the province, but the government is open to hearing all options.

He said the needs of the European market are certainly a factor in the interest, as is the federal government’s hydrogen strategy, which highlights Newfoundland and Labrador as one of the provinces with significant hydroelectric production that could play an important role in the hydrogen value chain for the country.

Parsons said he understands why people in the province might be wary of a new industry, using new technologies, but with the potential that the province has, it must be explored.

“The reality is that this is too good an opportunity for us as a province and the government not to explore because we continue to be told by global partners and by people with experience that we have some of the best resource globally, so we need to explore it. We stand the chance of being a player, so we have to look at what the opportunities are, what we need to do to achieve them and then hopefully set up a foundation for a renewable industry that can be sustainable into the future.”

He said the government is “cautiously optimistic” about the hydrogen future for the region and stressed that the proposals they are hearing relate to private capital, not government money.

The government is working on making the region more viable for hydrogen production, he said, including some upcoming changes to legislation to set up a process for companies to apply for Crown land for hydrogen projects.