How to Build a Green Hydrogen Economy for the U.S. West

Out in Utah, a coal-fired power plant supplying electricity to
Los Angeles is being outfitted with natural gas-fired turbines that
will eventually be able to run on hydrogen, created via
electrolysis with wind and solar power, and stored in massive
underground caverns for use when that clean energy isn’t
available for the grid.�

This billion dollar-plus project could eventually expand to more
renewable-powered electrolyzers, storage and generators to supply
dispatchable power for the greater western U.S. grid. It could also
grow to include hydrogen pipelines to augment and replace the
natural gas used for heating and industry or supply hydrogen fuel
cell vehicle fleets across the region. 

That’s the vision of the Western Green Hydrogen Initiative
(WGHI), a
group representing 11 Western states, two Canadian provinces and
key green hydrogen industry players including Mitsubishi and
utilities Dominion Energy and Los Angeles Department of Water and
Power. WGHI launched Tuesday to align state and federal efforts to
create “a regional green hydrogen
strategy,†including â€œa large scale, long-duration, renewable
energy storage regional reserve.†

At the heart of this effort are two projects in central Utah.
The first is the Intermountain Power Project, a coal-fired power
plant operated by the state-owned Intermountain Power Agency, which
supplies municipal utilities in Utah and California, including
LADWP. By 2025, Intermountain will
be converted
 to turbines to supply 840 megawatts of
power using natural gas blended with 30 percent hydrogen, a
proportion that will rise to 100 percent hydrogen over the coming
decades.  

The second project is the Advanced
Clean Energy Storage
 (ACES) project, which will invest roughly
$1 billion to develop a nearby underground salt dome to store
compressed hydrogen. ACES will provide up to 150,000 megawatt-hours
of energy storage capacity, a scale that dwarfs lithium-ion battery
capacity being installed in California and across the Intermountain
West. 

WGHI’s members hope this green hydrogen hub can â€œavoid
uneconomic grid buildout, prevent renewable curtailment, repurpose
existing infrastructure, reduce greenhouse gases and air pollution,
reduce agricultural and municipal waste, and diversify fuels for
multiple sectors from steel production to aviation.†

But industry groups say this kind of expansion will take

a concerted effort
 that has just
begun to emerge
 from the U.S. federal government. The WGHI
plans a regional aprroach “that’s taking a page from the playbook”
of green hydrogen plans being put
f
orward
in Europe
and Asia, said Laura Nelson, executive director of
the Green Hydrogen Coalition advocacy group.

Long-duration storage for an increasingly renewable powered grid
is a first step, but a two-day
virtual conference
 this week will take a look at other targets
as well, she said.  

“We know there are lots of other sectors that could be
decarbonized using green hydrogen, and we know intuitively that
there are other opportunities in the West,” Nelson said in a
Monday interview. “How do you aggregate that demand to create
sufficient momentum in the market to drive investment?” 

Intermountain and ACES: the hub of a western green hydrogen network

Mitsubishi Hitachi Power Systems won
the contract
 to supply Intermountain with its new
gas-to-hydrogen capable turbines earlier this year, and it and
Magnum Development, which holds rights to develop the underground
salt dome, have partnered on the ACES project, which could
include compressed air energy storage (CAES), flow batteries and
solid-oxide fuel cells. 

Mitsubishi also makes lithium-ion batteries for the rapidly
growing global market, Paul Browning, CEO of Mitsubishi Power
America. But today’s batteries can’t cost effectively store
more than four to eight hours of energy at a time, whereas hydrogen
can be stored indefinitely. 

“Hydrogen projects are going where there are existing
underground hydrogen storage capability, and a utility that’s
announced a net-zero carbon target,†Browning said. That’s the
case with ACES, as well as with Gulf Coast utility Entergy, which
is working with Mitsubishi to convert power plants and oil and gas
salt cavern storage sites to meet its recently
announced zero-carbon
 targets. 

“We feel that we need both of those to be true for hydrogen to
make sense right now,†he said. Green hydrogen still at least
four times as expensive to produce as “brown hydrogen†from
fossil fuel feedstocks, and the infrastructure to generate and use
it needs development to bring down those costs. 

One key factor in that cost reduction will be “scale, not just
of our projects, but of the electrolysis industry,†which will
need to grow its annual production capacity by several orders of
magnitude and improve
in efficiency
 over the coming decade. 

The other key cost factor lies in the green power to make
hydrogen, he said. ACES and Intermountain are part of a
transmission network connected to California and Nevada’s growing
solar resources, and to growing wind and solar power from Wyoming
and other Rocky Mountain states. But using only power that would
otherwise be curtailed would leave electrolyzers sitting idle most
of the time, unable to recover their capital costs. 

“We’re going to be opportunistic in using as much
curtailable renewables as we can get our hands on, while also
building our own renewables to increase our capacity factor,†he
said. 

An infographic of the ACES project (credit: Mitsubishi)

Next Steps in Green Hydrogen Development 

With Intermountain and ACES as a hub, Mitsubishi is looking for
opportunities to â€œconnect hydrogen into similar gas turbine
projects that will be able to use local renewables,†in an
expanding network of similar sites, Browning said.

One example is a project being proposed for Berkeley Pit, a
massive former open-pit copper mine near Butte, Mont. filled with
billions of gallons of contaminated water. Earlier this year,
Mitsubishi Power opened discussions with state and local government
officials on a plan to convert that water to hydrogen using the
rising amount of wind power being built in the state and nearby
Wyoming. 

While the project is still in exploratory stages, it could
“provide affordable, reliable energy while supporting state and
regional targets to reduce carbon emissions,” Michael Ducker, vice
president of renewable fuels for Mitsubishi Power, told government
officials in a September
conference call
. That could include replacing power from
Montana’s Colstrip
coal plant
, which is under economic pressure to close but faces
highly
uncertain future

The project could also include a 400-mile hydrogen pipeline to
connect the Berkeley Pit site to the Utah salt dome
project. Hydrogen’s lower energy density compared to natural gas
requires more storage and transport capacity, of a specialized
design largely confined to oil and gas production zones
today. But â€œthe safety issues are well understood,†Browning
said.

Approving and financing such a large-scale project would have to
build on successfully securing long-term hydrogen generation and
supply agreements at the Intermountain and ACES projects, he noted.
“Once we have that, then the next step will be to win an
electrical supply contract from the utilities in the Northwest,â€
he said. 

Green hydrogen as an energy storage technology, not a replacement
fuel

Whether green hydrogen can cost-effectively replace natural gas
for its myriad current uses will depend largely on carbon reduction
drivers involved. But it will also require a redefinition of what
it’s doing for the broader electrical system,
said Jussi Heikkinen, director of growth and development for the
Americas division of Finland-based Wärtsilä Energy Business. 

Wärtsilä’s engines power about one-third of the world’s
cargo ships and a good deal of electricity generation, he said.
It’s been making strides in converting its engines to run
on 100 percent hydrogen
 and is developing hydrogen generation
projects in the U.S. and Europe. 

In a study
focused on California
, Wärtsilä showed that zero-carbon
hydrogen, or methane generated with carbon capture technologies, to
fuel power plants is a much less expensive alternative to building
the battery capacity needed to cover the final 10 percent to 5
percent of grid power needed to reach its 100-percent carbon-free
energy goals.

“When there are huge load peaks, or cloud cover, or unusual
weather, these plants kick in, and allow you to build a much
smaller battery storage fleet,†he said. But such rarely used
plants will need different economic models for paying back their
costs. 

Mitsubishi’s Browning agreed that “green hydrogen is an
energy storage technology. That’s really important, because if
you look at it as a fuel, you want to compare it to the price of
natural gas and coal and other fuels — and that comparison does
not look very good for hydrogen.â€

“The proper comparison is what it would cost compared to
lithium-ion or other storage technologies,†he said. In that
role, green hydrogen could eventually be “the final source of
storage†for the Western transmission network, he said. “When
all of your batteries are filled up, and you still have more
renewables you’d otherwise have to curtail, we’re going to have
an unlimited capacity to absorb that renewable power.â€

Source: FS – GreenTech Media
How to Build a Green Hydrogen Economy for the U.S.
West