Green Canadian hydrogen not an immediate solution to Germany's energy worries

Some energy experts warn a deal to sell Canadianhydrogen to Germany will serve as only a small, far-off and expensive part of the solution to Europe's energy crisis.

German Chancellor Olaf Scholz and Prime Minister Justin Trudeauare set to sign a hydrogen agreement in Stephenville, N.L., nextweek, during Scholz's official visit to Canada.

A government official speaking on the condition they not beidentified confirmed there will be a hydrogen accord signed that isthe culmination of months of talks between the two countries.

Stephenville, a port town an hour south of Corner Brook onNewfoundland's west shore, is the planned home for a zero-emissionenergy plant where wind power will be used to produce hydrogen andammonia for export.

The deal between Canada and Germany is expected to makefuel-hungry Germany the first big customer for a first-of-its-kindproject in Canada.

Germany was already looking to hydrogen as an energy solution inits climate plan before Russia invaded Ukraine last February. But since that invasion, as Russia attempts to push back againstpunishing economic sanctions, it has repeatedly threatened Germany'senergy supply.

Germany typically gets about half of its natural gas from Russiaand is looking for both short- and long-term solutions to wean itselffrom Russian exports.

Proponents say the hydrogen deal comes at a pivotal time forCanada's green hydrogen industry, which is still in its infancy.

But some experts also say the fledgling product carries a bigprice tag and won't be able to help Germany in the near term. Canadadoesn't yet have the infrastructure to produce large quantities ofgreen hydrogen, or export it great distances.

"The key is you need a lot of associated infrastructure to bebuilt before we can do a large scale export of hydrogen into othercountries," said Amit Kumar, the industrial research chair of theNatural Sciences and Engineering Research Council.

Expensive to process

In order to be shipped, the hydrogen would likely need to becooled into a liquid, loaded into a specially adapted pipeline ortanker, and warmed again when it reached its destination.

The process and infrastructure is expensive, and so is production.

Most hydrogen production globally comes from converting naturalgas to hydrogen and carbon dioxide. If the latter is emitted intothe atmosphere, the hydrogen is referred to as "grey." In Canada,the goal is to capture those emissions with carbon capture andstorage, which would make the hydrogen "blue."

Canada has been talking up plans to help Germany with newnatural gas projects in Atlantic Canada that could one day beconverted to blue hydrogen facilities.

But Germany is looking mainly for "green hydrogen," which is made through splitting water molecules using renewable energy likewind or solar power. That comes at a much higher price.

"You're looking at anywhere between three- to fourfold increasein costs," said Kumar, a faculty of engineering professor at the University of Albertawho was consulted on the drafting ofAlberta's hydrogen strategy.

He said the technology needs to improve and more investment needsto be made before the cost is even relatively comparable with itsnatural gas-derived alternative.

The company behind the Newfoundland project, World Energy GH2,said the first phase of its Newfoundland project should see up to164 onshore wind turbines built to power a hydrogen productionfacility. Long-term plans call for tripling the size of the project.

In its proposal, World Energy GH2 said it is on the cutting edgeof a new, green industry.

Construction on the first wind farm is supposed to begin nextyear. That means hydrogen production is still far off, said PaulMartin, chemical engineer and co-founder of the Hydrogen ScienceCoalition.

"It'll take years and years and years," he said. "And thenyou've got the infrastructure problem."

Martin says the infrastructure costs of producing andtransporting green hydrogen don't add up.

"Honestly looking at it the green hydrogen pitch in Canada forexport, it's disingenuous," he said.

That's partially why Canada's hydrogen strategy involves movingtoward "blue hydrogen" before eventually converting to green,Kumar said.

Germany's strategy, however, clearly favours green hydrogen whilethe role of blue hydrogen is uncertain, an analysis by Centre forStrategic and International Studies fellow Isabelle Huber shows.

Trudeau and Scholz, who became Germany's chancellor in December,first discussed hydrogen and Canadian energy exports when Trudeauvisited Berlin in March.

At the G7 leaders' summit in the Bavarian Alps in June, Trudeauspoke at length with other world leaders about how Canada couldoffer alternatives to nations dependent on Russian oil and gas.

At a press conference at the conclusion of the summit, Trudeausuggested infrastructure used to carry liquefied natural gas couldbe adapted to carry hydrogen, as one example of how Canada couldhelp.

"We're also looking medium term at expanding someinfrastructure," Trudeau said, "but in a way that hits thatmedium-term and long-term goal of accelerating transition not justoff Russian oil and gas but off of our own dependence on fossilfuels."

Canadian hydrogen might be just one piece of Germany's plan totransition off of German gas in a very difficult situation, saidSara Hastings-Simon, who directs the masterof science insustainable energy development program at the University of Calgary.

"It's not the be-all, end-all. It's neither going to fix itcompletely or be the single answer," she said.

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