Nuclear operators around the world are exploring hydrogen production from nuclear energy. The potential benefits are clear: a new mode of flexible and clean energy storage that can be deployed as a fuel for any number of potential uses.
Last week I attended a workshop hosted by the International Atomic Energy Agency (the IAEA) that made this especially clear.
But chatting with colleagues from across the world—including representatives from Japan, China, Russia, Sweden, the EU, UK, and US—I was struck by how these nuclear operators, despite operating in very different markets, are dealing with a few common challenges around hydrogen deployment.
1. To co-locate or not to co-locate?
When using an electrolyzer to produce hydrogen, the most economical approach is to put production as close to the end user as possible (that is, to “co-locate”). It is usually cheaper to transport electricity than it is to ship hydrogen—after all, the infrastructure for electricity has already been built.
If you wanted to put hydrogen fueling stations along the 401, for example, it probably makes economic sense for each station to have a dedicated on-site electrolyzer that consistently replenishes its hydrogen supply.
The problem is that it may not be possible to guarantee hydrogen generated this way is “carbon free.” When electricity comes from the grid, it’s impossible to say just which generation source provided that electricity. In Ontario, we are fortunate our electricity is generated mostly emissions free. But about 7% of our electricity still comes from natural gas plants.
So hydrogen generated from electricity off the Ontario grid would still have emissions associated with it—unlike hydrogen generated with electricity straight from a nuclear power plant.
There are also potential benefits to keeping an electrolyzer close to a generating station. For example, regulators may find it easier to ensure the safety and security of hydrogen supply if it’s in an area that is already familiar with these issues. And an area like the Bruce region benefits from a pre-existing reservoir of energy expertise and experience that could be helpful to building and operating a hydrogen generating station. This hydrogen could then be shipped via pipeline or hydrogen-powered vehicles to wherever it is needed most.
Nuclear operators around the world are dealing with a version of this conundrum. Do we pursue electrolysis near the demand, where it might be most economical? Or do we install electrolyzers near nuclear generating stations, where it benefits from other synergies, and can be verified as “carbon emissions free”?
2. Supply and demand are the chicken and the egg
There are ambitious visions for the hydrogen economy in Canada. By 2050, the government believes hydrogen will account for 30% of all end-use energy in the country—a massive transformation of current energy use, requiring a huge increase in both the supply and demand for hydrogen fuel.
The problem is, which comes first? Like most energy sources, hydrogen production benefits from economies of scale that drive down costs for producers. But that level of production requires a large pool of consumers ready to buy the fuel.
Meanwhile, energy consumers can’t shift to hydrogen unless they are sure there is a reliable long-term supply in place. For businesses on either side of the equation, it is risky to make investments that may put them too far ahead of the market.
The normal progression of the free market is not going to solve this stalemate—at least not at the speed we need for the net-zero transition.
Instead, government must play a role in catalyzing the market. By providing added incentives for the production and/or consumption of hydrogen, governments can help businesses justify the business case for entering the hydrogen market.
The Canadian and Ontario governments have already begun to make movements in this direction. And hearing from colleagues around the world, it’s clear that other governments are doing the same. But nowhere has yet reached a point that the hydrogen economy can grow without help.
3. Building social license for hydrogen
When I speak to people about hydrogen, I often find there is only one example of hydrogen’s use that immediately comes to their mind: the Hindenburg.
In the nuclear industry, we are intimately familiar with the challenge when singular events come to negatively define an energy source for people. But also in the nuclear industry, especially here in Canada, we have the benefit of several decades of safe operation to demonstrate the reliability of existing technology.
When it comes to hydrogen, however, the fuel remains unfamiliar to most people. And when something is unfamiliar, it’s easy to default to a single scary story to define our perceptions.
This psychological impact from the Hindenburg disaster goes well beyond North America, with colleagues around the world speaking to the impact of that event on the public perception of hydrogen in their parts of the world as well.
Reassuring the public on hydrogen’s safety will require a mix of genuine consultation, stringent safety standards, and public demonstrations of the safe use of hydrogen.
In Canada, we have a long history of safe usage of hydrogen in industry that gives us ample experience to build on. And global efforts to improve and align safety standards, such as the Center for Hydrogen Safety, will give further guidance. But increasing the public’s comfort with hydrogen is going to take time and patience.
At the Centre, we are launching a study to examine the technical feasibility and business case for hydrogen production in the Bruce region. Keep an eye on the blog for more in the coming months as we share more of our insights along the way.
David Campbell is the Director of the Bruce Power Centre for Next Generation Nuclear.