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Released November 02, 2023 | SUGAR LAND
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Written by Paul Wiseman for Industrial Info Resources (Sugar Land, Texas)--Two recently announced hydrogen projects in the Houston/Baytown area of the Texas Gulf Coast symbolize the heightened activity for this sector since the passage of the Inflation Reduction Act by the U.S. Congress. Also fueling the surge is the Biden administration's inclusion of Houston's HyVelocity hydrogen hub among seven picked earlier this year. Each hub is slated to receive $1.2 billion in federal funding, geared at making hydrogen more available as part of the energy transition.
New Houston Hydrogen Projects
Electrolyzer manufacturer John Cockerill Hydrogen (Seraing, Belgium) has acquired a tract of Baytown manufacturing space that it plans to reconfigure into a new electrolyzer gigafactory. When completed, possibly as early as third-quarter 2024, the facility is expected to produce 1 gigawatt (GW) per year of electrolyzers. The company says it will be among the largest operational alkaline manufacturing facilities in the U.S. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can click here for the project announcement.
Using electrolysis to separate hydrogen atoms out of water is a common hydrogen isolation option, involving two electrodes submerged in a liquid electrolyte solution. The solution can either be alkaline or acid. An alkaline system such as that of John Cockerill Hydrogen typically uses either potassium hydroxide or sodium hydroxide.
And down the road in Baytown, Houston-based chemical giant LyondellBasell Industries NV (NYSE:LYB), in its third-quarter earnings call, confirmed plans to convert a soon-to-be-shuttered refinery into a hydrogen facility. However, the company is still mulling the exact nature of the facility, its schedule, and its priority, according to Chief Executive Officer Peter Vanacker. Vanacker noted that, in addition to internal decisions, there are external issues such as infrastructure and permitting that must be resolved first.
While the company originally planned to close the refinery in 2024, LyondellBasell is delaying the move until 2025. That will allow more time for planning the next options for the facility, and give its roughly 1,000 employees a better chance to transition, according to news media.
WoodMac Sees Hydrogen Project Growth Worldwide
These developments are consistent with a September 2023 Wood Mackenzie report that notes great growth in green hydrogen projects in 2023 both worldwide and in the U.S., compared to the sector's slump the previous year. "Expansion is rapid," said WoodMac's Head of Hydrogen Research Murray Douglas, "with more than 1,000 projects now in progress across 70 countries, and 100 new roadmaps, policies and strategies in the works." Douglas notes that U.S. projects account for about 18% of the total.
In the U.S., the Biden administration has targeted three main areas in its National Clean Hydrogen Strategy and Roadmap, said Douglas. He lists them as: "targeting 'strategic, high-impact uses for clean hydrogen:' cutting the costs of low-carbon hydrogen production, and establishing regional clean hydrogen hubs," of which Houston's HyVelocity Hub is among them.
Leading the way are PEM and SOEC electrolyzer projects, the report says. PEM refers to an alkaline proton-exchange membrane, while SOEC is a solid oxide electrolyzer cell. Both are considered green procedures when powered by renewable electricity. While no single country is listed as leading this category, Douglas sees Europe, China, and the U.S. as regions expected to see significant capacity additions.
Cost Abatement
Hydrogen is currently more expensive than natural gas--the latter being the major source of hydrogen today, although its release of carbon dioxide makes it unfavorable in the environmental community--but that cost could come down with flexible use of renewable electricity. Douglas suggests that renewable utility providers could sell electricity at a discount to hydrogen companies when the former's power demand is low. Then the electrolyzer could switch to selling its hydrogen to the utility at a higher price when demand rises. This would involve the utility also being able to switch from wind or solar to hydrogen as needed.
Some believe this trade-off could make renewables more reliable.
The most popular end-use of hydrogen continues to be ammonia, he said, due to the latter's versatility and transportability.
The Desired Outcome
Many analysts agree that government funding is necessary to kickstart most renewable initiatives, and this could be seen as exactly that. While there are still major obstacles between development and end-user success, this funding is moving things forward.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
New Houston Hydrogen Projects
Electrolyzer manufacturer John Cockerill Hydrogen (Seraing, Belgium) has acquired a tract of Baytown manufacturing space that it plans to reconfigure into a new electrolyzer gigafactory. When completed, possibly as early as third-quarter 2024, the facility is expected to produce 1 gigawatt (GW) per year of electrolyzers. The company says it will be among the largest operational alkaline manufacturing facilities in the U.S. Subscribers to Industrial Info's Global Market Intelligence (GMI) Industrial Manufacturing Project Database can click here for the project announcement.
Using electrolysis to separate hydrogen atoms out of water is a common hydrogen isolation option, involving two electrodes submerged in a liquid electrolyte solution. The solution can either be alkaline or acid. An alkaline system such as that of John Cockerill Hydrogen typically uses either potassium hydroxide or sodium hydroxide.
And down the road in Baytown, Houston-based chemical giant LyondellBasell Industries NV (NYSE:LYB), in its third-quarter earnings call, confirmed plans to convert a soon-to-be-shuttered refinery into a hydrogen facility. However, the company is still mulling the exact nature of the facility, its schedule, and its priority, according to Chief Executive Officer Peter Vanacker. Vanacker noted that, in addition to internal decisions, there are external issues such as infrastructure and permitting that must be resolved first.
While the company originally planned to close the refinery in 2024, LyondellBasell is delaying the move until 2025. That will allow more time for planning the next options for the facility, and give its roughly 1,000 employees a better chance to transition, according to news media.
WoodMac Sees Hydrogen Project Growth Worldwide
These developments are consistent with a September 2023 Wood Mackenzie report that notes great growth in green hydrogen projects in 2023 both worldwide and in the U.S., compared to the sector's slump the previous year. "Expansion is rapid," said WoodMac's Head of Hydrogen Research Murray Douglas, "with more than 1,000 projects now in progress across 70 countries, and 100 new roadmaps, policies and strategies in the works." Douglas notes that U.S. projects account for about 18% of the total.
In the U.S., the Biden administration has targeted three main areas in its National Clean Hydrogen Strategy and Roadmap, said Douglas. He lists them as: "targeting 'strategic, high-impact uses for clean hydrogen:' cutting the costs of low-carbon hydrogen production, and establishing regional clean hydrogen hubs," of which Houston's HyVelocity Hub is among them.
Leading the way are PEM and SOEC electrolyzer projects, the report says. PEM refers to an alkaline proton-exchange membrane, while SOEC is a solid oxide electrolyzer cell. Both are considered green procedures when powered by renewable electricity. While no single country is listed as leading this category, Douglas sees Europe, China, and the U.S. as regions expected to see significant capacity additions.
Cost Abatement
Hydrogen is currently more expensive than natural gas--the latter being the major source of hydrogen today, although its release of carbon dioxide makes it unfavorable in the environmental community--but that cost could come down with flexible use of renewable electricity. Douglas suggests that renewable utility providers could sell electricity at a discount to hydrogen companies when the former's power demand is low. Then the electrolyzer could switch to selling its hydrogen to the utility at a higher price when demand rises. This would involve the utility also being able to switch from wind or solar to hydrogen as needed.
Some believe this trade-off could make renewables more reliable.
The most popular end-use of hydrogen continues to be ammonia, he said, due to the latter's versatility and transportability.
The Desired Outcome
Many analysts agree that government funding is necessary to kickstart most renewable initiatives, and this could be seen as exactly that. While there are still major obstacles between development and end-user success, this funding is moving things forward.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
