Developing hydrogen consuming projects in an emerging market

The clean hydrogen industry is currently at the early adoption / market introduction phase. Different hydrogen end-uses might be more mature than others, but overall, this is where this industry stands today. How does this impact project development?

Hydrogen technologies have been demonstrated in many different situations and for a wide variety of applications. They have proven to be a reliable and effective options in many applications like decentralized power generation, CHP, mobility, etc.

Commercial operations fully relying on hydrogen are still few in numbers as shared experience on reliability & trouble shooting of hydrogen-based solutions is developing progressively. Although individual hydrogen products may be proven, they certainly haven’t yet accumulated the almost universal experience fossil technologies have.

Beyond the products themselves, the entire supply chain reliability is at stake. What good would it be to have a reliable burner if the hydrogen supply is disrupted? The hydrogen supply chain is developing and growing, thanks to governmental subsidies in many countries, and thanks to players in the distribution sector getting involved with this new clean fuel.

It is therefore fully understandable that potential customers be cautious and want to be brought conclusive proofs before they accept to trust hydrogen to power their operations. 

Therefore, one may wonder, how with a limited supply of conclusive proofs can we ease the process with potential hydrogen end-users and help them in their energy transition journey?

A possible approach is to reduce the height of the step. Before considering a full fuel switch, an end-user could start with a partial conversion as a first step. For example, a boiler is aging and will need replacement in a few years or can’t operate anymore at full nameplate capacity. Why not install a smaller one operating on hydrogen until the main equipment reaches the end of its lifetime?

Another option would be to start using hydrogen thanks to a dual fuel system, like truck retrofits that enable dual fuel operations and bring security of operations even when hydrogen supply is lagging. In the same logic, an end-user could start with fuel blending, which provides flexibility in the exact ratio of blending. This progressive approach enables to test the hydrogen solution while not taking a risk of a full operations disruption.

With such first steps, the supply risk is reduced. Indeed, in case the hydrogen supply is disrupted, the end-user has built-in flexibility to cope with such events. This will help work with fuel providers in consolidating a reliable hydrogen supply chain, that will enable a few years down the road a larger project. 

End-users might be entitled to a compensation of some sort for accepting to manage the hydrogen supply risks while the supply chain gets stronger.

Pyonnier can support the development of hydrogen projects. Contact us to talk about it!

Montréal, Québec, Canada

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