Hydrogen cannot be Japan’s silver bullet in its decarbonization efforts


Hydrogen cannot be Japan’s silver bullet in its decarbonization efforts

Japan is betting on Hydrogen to be a major contributor to its 2050 environmental goals. METI has a target of 10% of its power mix to be covered by power plants firing hydrogen/ammonia in 2050 and is also expecting hydrogen to be used for mobility applications. Understanding the physical limitations behind the hydrogen supply chain casts doubts on Japan’s strategy.

The efficiency of the hydrogen supply chain

The total efficiency of creating hydrogen by electrolyze and using it to generate power is close to 34%

A typical electrolyzer requires ~56kWh to create 1Kg of Hydrogen. Compressing it to 350bars requires ~2.7kWh. A CCGT firing 1Kg of hydrogen would generate ~20kWh
The total efficiency would therefore be ~34%. If the electrolyzer draws power from the grid, grid losses of ~3% would also have to be accounted for.

How green is “green” hydrogen?

Touted as a solution to decarbonizing the energy mix, “green” hydrogen fired power generation might not be as low carbon as expected. If we assume that the electrolyzer is powered by solar PV, then the carbon content of a kWh out of our hydrogen powered CCGT would be close to 250g/kWh (assuming 85g/kWh for solar PV) Powered by wind, it would be closer to 75g/kWh (assuming 26g/kWh for Wind). This does not account for the carbon content of manufacturing and maintaining the electrolyzer nor for the supply chain necessary to import the hydrogen in Japan.

For comparison, Japan’s current carbon content of electricity is ~450g/kWh. France’s is ~50g/kWh thanks to its high use of nuclear power.

Limited opportunities in mobility

In mobility applications the efficiency of the supply chain is even worse. A typical fuel cell generates 16kWh from 1Kg of hydrogen, bringing the total efficiency down to ~26%. An EV battery has an efficiency of ~82% (88% charge and 93% discharge). Hydrogen only makes sense for vehicles that needs a long range between charges or that cannot be immobilized for the time of the recharge.

Blue hydrogen

In December 2022 Japan signed cooperation agreements with Oman and Saudi Arabia on long-term procurement of blue hydrogen. This might be a good replacement solution to green hydrogen. It however comes with 2 major caveats.

  • Can CCUS be deployed at scale and fast enough to meet the world environmental goals?
  • And will natural gas supply be sufficient to generate enough hydrogen to power the ever growing economy promised by “green growth” proponents? A recent publication by The Shift Project, conducted under the supervision of the French Armed Forces, alerts on the risks of hitting “peak LNG” by ~2025 

Hydrogen will not save Japan

In an infinite world with no physical constraints on resources, in which renewable power assets could be deployed with no limitations, hydrogen could play a major role in power generation and mobility applications. But in today’s world, with increasing limitations on available resources, hydrogen use would be better limited to essential applications in which no serious low-carbon alternatives are available. Steel and fertilizers production would be at the top of the list. Japan plans to import hydrogen is only displacing its energy supply and decarbonization problems to other countries.

Japan is missing an opportunity to promote energy savings


Japan is missing an opportunity to promote energy savings

With rising energy prices Japan seems to have forgotten its decarbonization goals and is missing on an opportunity to promote energy savings.

In April 2021 prime minister Suga announced his target of reducing CO2 emissions by 46% compared to 2013 levels. If the number “46%” was subject to debate, it fits into the 2050 “net-zero” target. To achieve these goals, Japan will have to reduce its emissions by ~4% by year, every year.

Prime minister Kishida’s government is now considering subsidizing utility firms to curb power prices as well as a subsidy scheme for gas. The Japanese government has already been subsidizing gasoline wholesalerssince January to reduce retail prices. What was supposed to be a temporary measure, reviewed weekly, was extended in April. According to Reuters, these measures aim at achieving real economic growth of 2%-2.5% this fiscal year.

These measures will keep demand high for fossil fuels, maintaining Japan CO2 emissions above target levels and failing to bring any sustainable solution to future energy crisis.

Instead, by letting the retail price of energy rise and by promoting energy savings measures Japan could not only make progress on its climate goals but also ensure that future volatility of prices and long-term scarcity of fossil fuels would have a lower impact on its economy and its population.

Japan could promote Energy saving measures similar to what France recently announced, including temperature limits in buildings, limiting cars speed or turning-off advertisement displays at night. But it could of course go further. Subsidies could then be focused on consumers with low revenues and without alternatives.

Climate goals are extremely unlikely to be achieved without a reduction in consumption. Japan has the opportunity and a plausible excuse to start implementing measures that could not only have a short-term impact but set the direction of a new strategy with a real chance of meeting its climate goals.

Coal as the next energy for mobility in China


Coal as the next energy for mobility in China

Traditionally coal is the energy of power (and heat to some measure) while oil is the energy of mobility. From a physical perspective this is a consequence of the higher energy density per volume of oil.

However, energy security is a main concern in countries that do not have oil on their territory and the likely reduction in global oil availability is going to exacerbate this issue

Oil Availability concerns

In its “World energy outlook” 2018 the International Energy Agency wrote “Global conventional crude oil production peaked in 2008 at 69.5 mb/d and has since fallen by around 2.5 mb/d. […]

The level of conventional crude oil resources approved for development in recent years is far below the demand requirements of the New Policies Scenario, creating the risk of sharp market tightening in the 2020s.”

More recently the French Think-Tank “The Shift Project” wrote a report for the army on “The future of oil supply in the European Union: State of reserves and production prospects for major suppliers”. Based on Rystad Energy database and the know-how of two former directors of upstream operations from Total and a former IEA analyst they analyzed the oil reserves and production capacity of the top 16 world oil producers (excluding US sale oil and Canada). They write that “The aggregate crude oil production outlook for the sixteen major supplying countries, excluding US LTO, suggests a decline of approximately 12% in 2030, as compared to its 2019 level […]”

This however exclude US shale oil, which might be the only oil source keeping the global total oil production from a steep decline. Any changes in shale oil production would therefore have major impacts.

The increasing role of Coal as China’s mobility energy

With potentially less oil to run its economy, China might already be planning to switch to coal to increase its energy security by increasing both EV penetration and its production of synthetic fuels from coal.

China is already the biggest EV market with 1,246,000 new vehicles sold in 2020And the government aims for EVs to account for 50% of all new cars sold in 2035.
With 64% of its electricity coming from coal and 0.16% from oil, this is an indirect way to switch its mobility energy needs to coal.
Maybe even more interesting, is the fact that China has a methanation production capacity of 80 million tons per year and has been producing 70 million tons in 2019 with ~70% coming from coal. China also produced at least 20 million tons of Coal-to-liquid fuels and this is forecasted to reach from 29 to 56 million tons by 2030. China is therefore producing at least 90 million tons per year of synthetic fuel and displacing the corresponding oil. For reference, Japan consumes ~200 million ton/year of oil.

In April this year China announced that it planned to increase its coal production by 300 million tons this year, 7% of the previous year’s production.