Blue Hydrogen: Beyond the Plant Gate

Publication Overview

The primary objective of this study is to review the comparative analysis of blue hydrogen production (that is hydrogen derived from fossil fuels and associated CCS) technologies from oil and oil-based feedstocks as well as the supply chain implication. Further, this study includes techno-economic and life cycle assessments of different technology production configurations in regions that have access to oil resources and potential for the deployment of CCS infrastructure at scale.

Publication Summary

• Analysis in this study highlighted that the total demand for hydrogen could be nearly2,000Mtoe by 2050. This quantity could be delivered from all sources of hydrogen production,especially from blue hydrogen derived from oil and oil-based feedstocks, while addressingGHG emissions.
• The three blue hydrogen production pathways which use oil-based feedstocks selected fordetailed analysis in this study are steam naphtha reforming (SNR) + CCS, partial oxidation(POX) and hygienic earth energy (HEE). These technologies exhibit lower carbon footprints bybetween 58-67%, 47-77% and 71-78% respectively against the benchmark steam methanereforming (SMR) without CCS in 2020.
• The carbon footprints of all the technologies vary because of regional differences due to thecarbon footprint of the feedstock, fuel, and electricity source, and type of technologydeployment.
• The total carbon footprint of the selected hydrogen production pathways was heavilyinfluenced by the carbon footprint of the electricity source. This factor underscores theimportance of employing low carbon electricity even if a high capture rate is implemented inthe production of the blue hydrogen. Changes in the carbon footprint of electricity productionwas established to have the biggest impact on POX and HEE, to a lesser extent on SNR.
• All the studied oil-based hydrogen production technologies exhibited a higher cost than boththe reference grey hydrogen (hydrogen from SMR without CCS) production case and naturalgas based blue hydrogen production in the Netherlands via SMR in 2020. However, by 2050,the cost of most of the blue hydrogen pathways from oil-based feedstocks substantiallydecreases due to larger markets in the oil-producing regions, including to achieve their climateaction targets, and economies of scale in hydrogen distribution and CO₂ T&S (transport andstorage). If higher carbon prices are applied, blue hydrogen costs will be lower than hydrogenderived from SMR without CCS in the long term.
• In the longer term, the falling cost of renewable electricity and alignment with net zeroambitions is likely to make green hydrogen production increasingly competitive and lowercost than blue hydrogen production in cases where low-cost electricity is available.
• One potential competitive pathway for hydrogen derived from oil and oil-based productsagainst other mainstream alternatives could be achieved if the hydrocarbon feedstock istreated as a waste product (vacuum residue) or assuming it has no inherent economic value(retained within a depleted reservoir).