Home Business UAE-based Masdar is looking for a fast-track advantage in the emerging green hydrogen market

UAE-based Masdar is looking for a fast-track advantage in the emerging green hydrogen market

by SuperiorInvest

Over the past decade and a half, Abu Dhabi’s Masdar has built itself into one of the world’s largest developers of renewable energy projects. Now, as the UAE prepares to host the next UN climate summit, COP28 at the end of the year, it is branching out into a whole new business area – green hydrogen.

Hydrogen is considered critical to achieving global net zero goals. It can be used for a wide range of applications, including power generation, energy storage, transportation (especially heavy transportation such as shipping and freight). It can also be used to produce sustainable aviation fuel (SAF) and, most importantly, it offers a way to decarbonise ‘hard-to-reduce’ industries such as steel, aluminum and cement, where it is not possible to use only renewable energy sources. as well as other high-carbon industries such as fertilizers.

“Some industries require ‘green molecules’ (rather than green electricity) to decarbonize,” said Dr. Faye Al Hersh, strategic technology specialist at Masdar, during the company’s Abu Dhabi Sustainability Week. For steel and cement, CO2 is part of the production process rather than just a product of the energy used, but it is possible to decarbonize production with hydrogen.

While current production methods (known as gray hydrogen) that remove hydrogen from methane gas are very carbon-intensive, it is possible to produce low-carbon hydrogen either by carbon capture and storage (blue hydrogen) or by using renewable electricity and an electrolyser to produce a gas known as green hydrogen.

Following a capital injection from Taqa, Abu Dhabi’s national energy company, Mubadala Investment Company and ADNOC, Abu Dhabi National Oil Company, Masdar hopes to help create the sector.

According to Al Hersh, Masdar hopes to both export hydrogen from the UAE and build facilities in other markets. It plans to produce 1 million tonnes per year by 2030, in addition to its target of 100 GW of renewable energy capacity by the same date. The largest markets for green hydrogen are expected to be Europe, as it promotes green rather than blue hydrogen production, and the US due to incentives for hydrogen production in the recently passed Inflation Reduction Act. Meanwhile, markets in Asia, including South Korea and Japan, are looking to use green ammonia in power plants and industry.

In terms of sectors, both the aviation and marine sectors will be subject to decarbonisation regulations, which will significantly increase their demand for cleaner fuels. Hydrogen can be used in aircraft in its pure form, as well as in the production of SAF, which can be used as a “drop-in” fuel to replace conventional jet fuel.

However, many issues still need to be resolved throughout the value chain, including the best way to transport hydrogen. In its pure form, hydrogen is difficult to store and transport. However, it can be converted into other derivatives, for example combined with nitrogen to form ammonia, which can be used as a fuel in power plants, or made into methanol, which can be used as a marine fuel. “It’s best to produce hydrogen in the form that the recipient wants to use it in, because converting back to hydrogen is complicated,” says Al Hersh.

Currently, because the market is so nascent, most projects require a supplier willing to pay a premium for green hydrogen. The main cost of green hydrogen is the energy required to produce it, so a source of cheap renewable energy is key to making the projects commercially viable.

Another issue that has not yet been resolved is the technology that will be used in the electrolysers. The two main technologies are PEM (proton exchange membrane) and alkaline, with a solid oxide option possible in the future but less advanced than the other two. Nel Hydrogen says that PEM electrolysers are likely to be preferred for smaller and decentralized projects, while alkaline devices are likely to be used for larger scale industrial projects. The cost of electrolyzers is set to drop dramatically over the next few years due to a combination of technological improvements and economies of scale.

Masdar has announced a number of early-stage projects, including partnerships with Fertiglobe and Engie to build a 200MW green hydrogen plant in the UAE; hydrogen and SAF project with Siemens, TotalEnergies, Etihad and Lufthansa airlines, Marubeni and Khalifa University. The company is also developing projects in Great Britain, Egypt and Azerbaijan.

Its latest announcement is a feasibility study for the production of SAF using municipal solid waste gas and renewable hydrogen, in collaboration with ADNOC, bp, Tadweer and Etihad Airways are exploring the production of sustainable jet fuel from municipal solid waste and renewable hydrogen in the UAE.

“Our goal is to leverage our footprint in existing projects and markets,” says Mohamed El Ramahi, the company’s Green Hydrogen Executive. “We want to aim for a market share of at least 15% of green hydrogen derivatives. We believe that by 2030 we can reduce the price of hydrogen from $4 to $2.

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