No-Compromise Hydrogen, Part 3
Today’s post continues our ‘No-Compromise Hydrogen’ series. In this third article, we explore hydrogen energy from a cost-benefit perspective. If you only consider the laws of supply and demand, hydrogen should be as cheap as water given that it is, by far, the most abundant element in the universe. The keystone, however, is access. Our second article in this series covered this very topic. In “The Path from Hydrogen Abundance to Availability,” we explored how the atomic properties of H2 constrain its availability (despite its ubiquitous nature) and how technology is helping us to access this most energetic of elements to make it available as a sustainable source of fuel. Making hydrogen easily available, in turn, will make it an affordable alternative source of energy to power our civilization.
With Availability Comes Affordability
Traditionally, the methods to extract H2 from water and hydrocarbons and to safely store and transport it in a liquefied form made hydrogen an expensive value proposition for most practical purposes. As a result, it was only used to power certain applications, such as fuel for hundreds of NASA missions, rockets, and probes or as a coolant for industrial processes, among other specialized uses. Today, niche is no longer a word closely associated with hydrogen. In the past decade, rapid technology advancements have broadened hydrogen’s application horizon. Many cities around the globe now have hydrogen-powered cars and public transportation (buses and trains) that use fuel cells.
Other sustainable energies, such as solar and wind, have also experienced exponential growth and innovation in the past decade. Although more than 80% of the world’s energy still comes from carbon-emitting fossil fuels, the next few years will prove to be transformative in the energy sector. Continuous innovation and greater adoption will enable sustainable energy sources, including hydrogen, to become more easily available, and thus, become as affordable as hydrocarbons to change the energy game. And right when the world most needs it, might we add.
“Clean, Unlimited and Cheap Power” that Comes with a Shock
Last week, The Economist’s feature story revolved around the economics of energy. The cover of the magazine used a teaser, “Clean Energy’s Dirty Secret,” to explore how renewables are transforming the economics of the world’s electricity markets. Their lead article indicated how alternative fuels such as solar and wind, which were “peripheral to the energy system just over a decade ago,” are “now growing faster than any other energy source, and their falling costs are making them competitive with fossil fuels.” The new era of “clean, unlimited and cheap power” that they foresee does not come without a shock to the “vertically integrated” electricity delivery business models of utilities around the world.
The Economist quotes Bruce Huber, managing partner and founder of Alexa Capital, regarding this “shock,” in which he “likens the upheaval facing utilities to that seen in the telecoms industry a generation ago.” The fact is, all industries eventually face innovation-caused upheaval. From retail to transportation to energy, it is almost impossible to find an industry that has not faced and adapted to the disruption that progress creates—especially in the last 20 years. We strongly believe that utilities will greatly benefit from the transformation in alternative energy that we are experiencing from solar, wind, and soon, hydrogen. In a recent post, “A Bright Future Ahead for Utilities,” we explored how sustainable energies such as solar, wind, and hydrogen will help utilities deliver the clean energy their consumers demand. We also looked at how technological innovations in the management of the grid, such as cloud computing, will help utilities manage both the core and the edge of the grid more effectively. Add to this mix a 24/7 energy source like Hydrogen 2.0, which can provide energy on-demand, where and when it is needed, and the problem of variability that traditional alternative energies create for utilities can also be solved.
Affordability has Two Sides
The current reality is that when talking about affordability in the energy sector, cost and sustainability go hand-in-hand. The world needs energy that it can afford from an economic perspective as well as a climate one.
From the economic perspective, the “shock” that The Economist refers to is really just the normal disruption that newcomers—solar, wind, and lately, hydrogen—cause in the price of energy that’s built into traditional financial models of the electricity that powers our homes and datacenters to the energy that moves transportation. These financial models will eventually incorporate the realities of these new sources of energy, and the industry will thrive.
We cannot talk about economic affordability alone. Climate change makes it imperative to bring to market sources of energy the planet can afford without compromising growth and prosperity. A world where more than 80% of the energy we use results in global warming is one we must inevitably move away from. The world of tomorrow will see many sources of energy, including fossil fuels, playing in concert to deliver plenty of fuel the world can afford at all levels.
Playing Our Part
The compromises we must make between clean and affordable energy today are a temporary pain in the transition to a sustainable future. At Joi Scientific, we are working to make hydrogen as affordable as other major sources of energy. Our Hydrogen 2.0 technology can be used in the future to augment the options available to major players (such as utilities), so they can deliver more clean energy at competitive prices to meet the demands of their consumers.
Despite the uneasy headline of their story (“Clean energy’s dirty secret”), The Economist writes, “The good news is that technology can help fix the problem [that sustainable sources cause to utilities.]” In the energy industry, we all have a part to play to make sure the disruption “shock” [of the renewables revolution] moves us forward without leaving anybody behind.
This is a shock we can all afford.
As the Hydrogen 2.0 ecosystem gains momentum, we’ll be sharing our views and insights on the new Hydrogen 2.0 Economy. We also update our blog every week with insightful and current knowledge in this growing energy field.