Authors: Cameron Aldren, Nilay Shah, Adam Hawkes
Name of journal: Cell Reports Sustainability
Given disparities in renewable energy potentials across different geographies, there is increasing motivation to export energy from areas of low-cost production to those where costs are high, thereby facilitating economical decarbonization at a global scale. While the hydrogen economy promises an ability to transport renewable energy, it is currently falling short of cost targets set by policymakers, due to technological costs and inefficiencies. To transport hydrogen, there are two leading choices: physical and chemical conversion of the low-density molecule. These choices have been found to expose the value chains to distinct sources of uncertainty between equipment cost (physical as liquid hydrogen) and energy efficiency (chemical as ammonia). Ammonia was found to be more cost effective if it can be used directly (rather than being converted back to hydrogen), but there is no clear optimal choice when the ammonia is converted back to hydrogen. This serves to promote ammonia, as our research finds it to always be either cheaper or equally as expensive as liquid hydrogen. While this research projects to a net-zero 2050 scenario, there is potential for cost reductions and efficiency improvements beyond that of what is predicted by this research. Given the maturity of ammonia production technology, there are limited strides to be made in improving the efficiency of its production process. However, hydrogen liquefaction is in its infancy, and given the unprecedented cost reductions seen in adjacent low-carbon technologies, such as wind turbines and electrolysers, the capital cost for liquefaction technology could follow a similar trend. Combined with the capital sensitivity of the liquid hydrogen value chain, there is potential to exploit this trend to see a massive reduction in cost. Large cost reductions are necessary for the hydrogen economy to see deployment, so liquid hydrogen could be better poised to realize these reductions in the future.
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