Team:SJTang/Market Study

1. Hydrogen demand in recent years

Hydrogen is a versatible energy source that can be applied in different areas. It can be used in a wide range of applications regarding its attributes: storable, high energy content per unit mass and its readily produced rate at industrial scale. More importantly, it can be produced by various low-carbon energy sources, and can be made without producing direct greenhouse gases or emissions of air pollutants. Hydrogen plays an irreplaceable role in accomplishing climate neutralization. It is the mainstream of energy production in diverse group countries. It is seen as a potentially valuable and vital resource in the future energy market. The International Energy Agency predicts that by 2070, the global demand for hydrogen will increase sevenfold from 2019 to reach 520 million tons. This means that as a low-cost clean energy solution, biological hydrogen production will have broad market prospects. According to IEA 2019, the demand of hydrogen production has consistently increased since 1975 (Figure 1). In estimation, around 70 MtH2/yr is used today in pure form for oil refining, ammonia manufactures for fertilizers. This number will drastically increase for the rest of the year.

Figure.1.1Barchart showing global annual demand for hydrogen since 1975.

In recent years, governments have also published various policies in supporting the hydrogen production market, including the Group of Twenty, the European Union. The release of policies boosts the global spending on hydrogen energy development and demonstration (RD&D), hydrogen-related research. As shown in Figure 2, the trend has risen with more a more countries participating and investing in hydrogen-related projects. However, it still remains low compared to the peak in 2008.

Figure.1.2Barchart showing government RD&D budget for hydrogen and fuel cells.

2. The significance of hydrogen in future market

Due to the covid-19 pandemic, the economic crisis has been greatly impacted, which also leads to the largest emission decline in the world. Fossil fuel consumption was driven down in 2020, whereas renewables and electric vehicles are not affected. As shown in Figure 3, the global energy-related CO2 emissions in 2020 are about 31.5 Gt, lower than the peak in 2018 of 33.5 Gt, inlining with the 31.3 Gt in 2011. The global emission has dropped by 5.8%, it is ‘’the largest annual percentage decline since World War II” according to the IEA Global Energy Review: CO2 Emissions in 2020. The decrease in transportation, power generation in the power sector, and global economic development are the main factors that contribute to the massive emission decline.

Figure.1.3Line graph indicating global energy-related CO2 emissions from 1990 to 2020.

However, these limiting factors will be eliminated as the number of actions are taken by the governments to alleviate the pandemic and the economy slightly recovers in 2021. Following the cancellation of various forms of restrictions on movements and travels of advanced economies, the decreasing trend of CO2 emission will no longer be maintained. In accordance with the newest statistic data released by the IEA, monthly data implies the recovery of economic activity and the rebounding of CO2 emissions. By the end of 2020, global CO2 emission has already risen by 2.1% compared to -14.5% in April 2020. In such harsh conditions, it is crucial for people to find ways to limit emissions to fulfill the goals set by the Paris Agreement. As mentioned by the United Nations "COVID and climate have brought us to a threshold, we cannot go back to the old normal of inequality and fragility; instead, we must step towards a safer, more sustainable path." More experts agree that hydrogen will be vital to meeting the goals of the Paris Agreement.

3. Why hydrogen?

3.1 Environmental friendly

The use of hydrogen energy is the most suitable solution in regards to its zero CO2 production. When using hydrogen as energy, less CO2 will be emitted compare to the burning of coal . Compared to conventional technologies, its annual emission rate is 0.24lb/MWh, some lower with only approximately 0.01 lb/MWh emitted.

3.2 High energy efficiency

Hydrogen can be stored in forms of gas or liquid without dissipation until it is used. Compared to other energy storage types, batteries and capacitors, that will lose the energy stored over time and requires rapid charging. Fuel cells have greater energy efficiency with an efficiency level greater than 80% in combining with heat and power system. In comparison, the general power plants around the world only hold an efficiency level of 35%.

3.3 Wide range of applications

Hydrogen can mainly be used in two main areas, heat production and electricity generation through feeding into fuel cells. According to the 2018 CSIRO report, hydrogen can be potentially used in several areas including making container ships powered by liquid ammonia made from hydrogen and fuel-cell hydrogen electric cars and trucks; used as a substitute for natural gas for cooking and heating in homes; burning hydrogen as a heat source rather than coal in "green steel" refineries.

3.4 Can be produced using various resources

With no pollutants or greenhouse gases produced, it can be produced using a wide variety of resources including waste, biomass, wind or solar with a cost effective manner. The resources can all be found domestically. Hydrogen can also be produced under different pathways, including electrolysis, steam methan reforming, coal gasification and fermentation. The listed pathways will be selectively explained in details above.

Hydrogen is cleaner and more efficient than traditional combustion-based engines and power plants, with a greater range of application including power vehicles and mobile power packs. Using hydrogen as the major energy source for the future could effectively limit the production of CO2 emission and providing the energy demand simultaneously. According to the latest news, methane has contributed about 30% to global temperature rise. Curbing these emissions is the most effective way to limit global warming in the near future. Finding an alternative clean energy solution is essential. Hydrogen energy is an efficient renewable energy source, and biological hydrogen production is a low-cost clean energy solution.

4. Existing hydrogen production pathways

Hydrogen can be produced through various methods. The most commonly used ones are coal glassification, electrolysis and biological hydrogen production through photofermentation and dark fermentation.

Almost 95% of the hydrogen consumed today comes from fossil fuels. It is produced by two of the most common methods: coal gasification and steam methane reforming. During the production process, fossil fuel (that is, coal or natural gas) feed reacts with steam to produce carbon monoxide, carbon dioxide and hydrogen.

Compared with the hydrogen production method based on fossil energy, the hydrolysis method is regarded as a cleaner large-scale solution. Polymer electrolyte membrane (PEM) and alkaline (ALK) technologies are the two main ways of hydrolysis at present. The principle is similar, The main difference lies in the membrane electrode.

ALK alkaline electrolysis technology is relatively mature, its production cost is low, and the output is about 1000 cubic meters/hour. However, because the liquid electrolyte used by ALK is highly corrosive, its maintenance cost is high and it is potentially harmful to the environment. PEM proton exchange membrane electrolysis is environmentally friendly, has a long life and simple maintenance, but the current technology is still relatively complex, and the output is also limited (400 cubic meters/hour).In order to avoid carbon dioxide emissions caused by hydrogen production from fossil fuels, we have find a low-carbon and low-cost biological hydrogen production method.

Figure.4.1Current distribution of hydrogen production methods.

5. Why biohydrogen?

5.1 Sustainability

Hydrogen can be produced consistently through biological pathways, including photofermentation and dark fermentation. Photofermentation can provide economical hydrogen production. Its main energy source comes from sunlight, which is inexhaustible. The process will continue automatically, with less manpower resources needed. In dark fermentation, the sustain of the process is also shown.

Photofermentation is a natural process that plays a significant role in the ecosystem. Utilizing such a natural process could prevent the ecosystem from heavy damage and also limit the growth of carbon emission today. As photofermentation is processed by bacteria and algae, waste water can also be recycled and used to cultivate organisms. In addition, for dark fermentation, waste water and biomass can be used to produce abundant hydrogen energy, cleansing the environment and reducing the amount of energy normally needed for waste product treatment.

5.2 Lower cost

Compared to production technologies such as electrolysis or coal gasification, biological production has a cheaper cost. Hydrogen can be produced by utilizing wastes and by-product such as crude glycerol, which greatly lowers the cost. This is also the most unique characteristic of biological hydrogen production that makes it different from other pathways.

5.3 Portability

The process of biological production is always portable and easy to deploy. Different from other pathways, such as electrolysis, which requires a variety of equipments, biological production only needs a suitable strain with an environment with appropriate temperature and humidity. All the chemical reactions will undergo naturally by the chosen bacteria or algae.

5.4 Contributes to the rising hydrogen demand

According to CSIRO National Hydrogen Roadmap Report, the world is still producing hydrogen in a now-renewable way from fossil fuels. Only 4% of hydrogen is produced from electrolysis, powered by renewable energy such as solar and wind energy. Due to the high cost of electrolysers, the scale and economics of market adoption cannot be reached. It is hard to fully replace production from fossil fuels with electrolysis. Advances in biological hydrogen production technology is essential in dealing with the upcoming rising demand in hydrogen energy.

6. Cost accounting for biological hydrogen production

In 2017, the Department Of Energy of the United State conducted a recording project named Hydrogen Production Cost from Fermentation. In the project, a prediction of the cost used for fermentation in the year 2025 has been made. The cost is calculated using Hydrogen Analysis version 3.101 (H2A Production v3.101) model with a production capacity of 50,000 kg H2/day. The table above indicates the cost required without considering taxes, delivery and dispensing.

Hydrogen cost is sensitive in the change in feedstock, the cost is highly dependent on the system capital cost. As shown in the chart, reducing the total capital cost and limit the feedstock cost can largely influence the cost accounting for biological hydrogen production.

The cost of hydrogen is approximately $8.56/kg. According to the report, a cost of $3/kg of H2 can be achieved by lowering equipment capital cost, increasing the molar yield, increasing electrical byproduct generation, increasing PSA recovery, and raising the fermentation concentration.

Figure.6.1Table showing the estimated cost needed to produce 50.000 kg H2/day by 2025 (only looking at the future case).

Figure.6.2Tornado chart showing parameter sensitivities for the future case by 2025 (with byproduct credit).

7. Interviews with relevant stakeholders

7.1 Tongji University

We had the opportunity to interview Professor Sheng Wenchao, professor and doctoral supervisor of the Department of Environmental Science, School of Environmental Science and Engineering, Tongji University. Discussed the technical improvement of hydrogen manufacturing and the cost of manufacturing, transportation, and storage.

1) How did you first notice the research related to new energy/fuel cell/CO2 electrocatalysis?

At the end of the day, all environmental problems come to energy. I first studied chemistry, and then turned to electrochemistry. Personally, I think it is more interesting to involve physics, material design, and chemistry altogether. At first, I thought it was very interesting to learn about energy and the environment. Later, hydrogen energy became popular, and the country also paid more and more attention to hydrogen energy projects. There are great prospects for learning about the environment and energy. Electrocatalysis conditions are relatively mild and the operation methods are relatively convenient. However, in any case, the energy sources used in electrochemistry should be renewable, so that they have economic significance for the environment. The environmental college where I am now is concerned about the fundamental issues that ultimately come down to energy issues. The relationship between energy and the environment is inseparable, so I think it is worth studying in depth.

2) Do you think it is realistic to promote hydrogen as the main fuel/fuel cell/electrolytic cell on a large scale in terms of the current environmental development trend? What are the technical defects in the current market?

- High cost; conversion and catalysis between precious metals, high cost of raw materials
- Supporting facilities: hydrogenation station gas station can not be shared, low power
- PEM membrane patent in DuPont (1960s monopolized the technology); requires a stack; acid electrolysis using a solid membrane, alkaline electrolysis membrane cost is lower; anion exchange membrane fuel cell; not easy to leak;
- Price: 500-1000usd/m ^ 2; PEM better can do 2-3W/cm ^ 2
- Theoretical conversion 85% (ΔG/ΔH); practical 50-60%; electrolysis 40-50%

The cost of fuel cells is relatively high. Although the market price of fuel cell vehicles is not very high, there should still be a lot of government subsidies inside, and the actual price should be higher than the market price. Fuel cell vehicles are more suitable for long-distance mileage, which can reduce the cost of use. Now the country is also promoting small fuel cell vehicles for domestic use, but there are still many problems. For example, the power is not large, the use of charging piles, and the mileage is small. There are many disciplines involved in fuel cells, which is a relatively large system engineering problem. It is feasible to make small fuel cells in the laboratory, but there are still some difficulties in making large-scale ones. Basically, enterprises, laboratories, universities and other departments are required to complete large-scale batteries together. In addition, the installation of hydrogenation stations and the storage and transportation of hydrogen are great challenges.

7.2 Huazhong University of Science and Technology

Professor Yunjun Yu of Huazhong University of Science and Technology also spoke with us. By focusing on biotechnology and synthetic biology, Yu has been involved with more than 40 major and key research projects at regional, national, and provincial levels. Now his research fields include synthetic biology, cell factories, bio-cement key technology, biodiesel preparation key technology, engineering and industrialization, biodiesel and high-value oil technology and engineering applications, and other fields of application research and development.

1) If we were to compare the production of hydrogen using biological processes, such as fermentation, with the traditional methods that are based on chemical reactions, which are used to produce hydrogen for industrial use, what would be the main advantages? In other words, does the biological approach have a realistic shot at capturing the future hydrogen market when traditional methods remain in play?

- Promotability (today, a large portion of Sinopec's hydrogen is gray hydrogen, and production of biological hydrogen has not yet become industrialized due to high costs)
- Market advantage (if the production of hydrogen can be guaranteed)
- Environmental protection (our production does not emit CO2, in keeping with the current environmental theme)
- Good operation and short period (for instance, semi-artificial photosynthesis and co-culture)
- Profound intention (to motivate an electric fan with a small fuel cell)
- Hydrogen advantage (focus on technology, cost and yield)

2) In the event of our project's success, what practical implications do you think it might have for the hydrogen industry? How can we put it into practice?

- Modify the previous industrial structure
- Be more environmentally friendly
- Considering making energy drinks if the yield is low (hydrogen drinks are healthy).
- If the yield is high, consider power generation (small fuel cells require 50-100ml hydrogen to turn the electric fan)

3) To achieve our goal of reducing unit costs, what changes in project design are necessary to increase the efficiency of hydrogen production?

- Optimize the cultivation system
- Modify oxygen sensitivity
- Forbidden the hydrogen absorption part
- Add an electron donor
- Pay attention to collection methods
- The use of organic substrates should be considered cautiously
- Optimizing pathways
- Replacing bacteria with algae (algae has a higher absorption and fixation of carbon dioxide; with low cost; no need for organic matter; have fewer research results; it is more innovative)

4) Could you point out any shortcomings in the experiments we conducted? What needs further optimization and improvement?

- The breeding of strains are anaerobic organics ( a greater number is required compare to algae)
- Cost (the biggest cost is the cost the use of base material when cultivating the bacteria, the use of wastewater organic matter should be considered, which reduce the cost)
- Carbon neutralization (carbon neutralization mainly involves fixing CO2, which is not satisfactory in the experiment)
- Catalysts (the experiment uses existing catalysts, the procedure is simple but not innovative)

7.3 China Institute for Science and Technology Policy at Tsinghua University

It is with great honor for us to interview Mr. Yushi Chen, visiting scholar at China Institute for Science and Technology, former researcher of the United Nations High-level Group on Secretary-General Digital Cooperation. Mr. Chen majors in environmental finance . Through our discussion, we gained a well-rounded understanding of the role that biohydrogen plays in sustainable energy market, and excerpt of the interview is as follows:

1) To your knowledge, what is the key flaw of biological hydrogen production?

The main constraints of the hydrogen economy are the low yield and high cost of clean hydrogen.
At present, microbial hydrogen production technology is still quite cutting-edge, but its issue still lies on efficiency. It is best to form specific solutions like hydrogen based on the petrochemical industry. At present, the hydrogen economy is mainly supported by the petrochemical industry. In fact, it will form a certain competitive relationship with the power economy. The hydrogen energy industry has a long cycle, especially in clean hydrogen. In tackling climate change, there are also microbes designed for carbon fixation or soil remediation.

2) I see, and are there any advantages that are unique to biohydrogen?

Carbon neutralization might be a way out, similarly to LNG + CCUS(natural gas reformation with respective carbon fixation processing).

3) In the course of our project, we realized that many clean hydrogen production methods require quite high initial investment, such as electrolysis. At this stage we hope to use biotechnology to solve the small or micro-scale energy demand for communities in need. To what extent do you consider it valuable?

This is surely valuable and worth trying, but please do keep in mind that such innovation has a long cycle. Try to keep it cheap and make it fast.

8. Conclusion

The Paris climate agreement deadline is approaching, and the coronavirus is making it increasingly difficult to achieve carbon neutrality. Electrolysis alone is no longer enough to sustain the current demand for hydrogen, and fossil-fuel-based hydrogen does not fit into a time when carbon emissions need to be controlled. The production of hydrogen from biological processes, an environmentally friendly process, requires a breakthrough in technology now. As soon as its problem of insufficient yield is resolved, this will be a significant contribution to the process of carbon neutrality. SJTang is committed to improving the productivity of biological hydrogen production and enhancing its production performance, making it a low-carbon, low-cost hydrogen production technology, which is economically viable and suitable for the hydrogen energy market. Instead of a common project to produce hydrogen biologically, we are also looking for new strains of bacteria. Reducing production costs and increasing production efficiency, not only lower the costs while maintaining low carbon emission, but to also come up with a broader range of substrate options for hydrogen production through biomass.

References

https://www.abc.net.au/news/science/2021-01-23/green-hydrogen-renewable-energy-climate-emissions-explainer/13081872
https://afdc.energy.gov/fuels/hydrogen_benefits.html
https://www.sciencedirect.com/topics/engineering/hydrogen-production-cost
https://www.hydrogen.energy.gov/pdfs/16016_h2_production_cost_fermentation.pdf
https://www.sciencedirect.com/science/article/pii/B9780128148532000035
https://www.un.org/sg/en/content/sg/articles/2020-12-11/carbon-neutrality-2050-the-world%E2%80%99s-most-urgent-mission
https://www.iea.org/articles/global-energy-review-co2-emissions-in-2020
http://chfcc.org/resources/hydrogen-fuel-cell-benefits/
https://www.energy.gov/eere/fuelcells/hydrogen-production-microbial-biomass-conversion
https://www.energy.gov/eere/fuelcells/hydrogen-production-photobiological
https://iea.blob.core.windows.net/assets/9e3a3493-b9a6-4b7d-b499-7ca48e357561/The_Future_of_Hydrogen.pdf
https://arena.gov.au/assets/2021/03/biological-hydrogen-production-mid-term-activity-report.pdf

Figures

Fig 1.1 IEA (2019), The Future of Hydrogen, IEA, Paris https://www.iea.org/reports/the-future-of-hydrogen
Fig 1.2 IEA (2019), The Future of Hydrogen, IEA, Paris https://www.iea.org/reports/the-future-of-hydrogen
Fig 1.3 IEA, Global energy-related CO2 emissions, 1990-2020, IEA, Paris https://www.iea.org/data-and-statistics/charts/global-energy-related-co2-emissions-1990-2020
Fig 6.1 Randolph, K., Studer, S., Ren, J., Liu, H., Beliaev, A. and Holladay, J. (2017). Title: Hydrogen Production Cost from Fermentation Originator: Analytical Basis. [online] Available at: https://www.hydrogen.energy.gov/pdfs/16016_h2_production_cost_fermentation.pdf.
Fig 6.2 Randolph, K., Studer, S., Ren, J., Liu, H., Beliaev, A. and Holladay, J. (2017). Title: Hydrogen Production Cost from Fermentation Originator: Analytical Basis. [online] Available at: https://www.hydrogen.energy.gov/pdfs/16016_h2_production_cost_fermentation.pdf.