World Energy GH2 faces a delay in selling product from its Newfoundland and Labrador wind-hydrogen project until European buyers develop the new infrastructure they’ll need for the fuel, the company has announced.
“The offtakers are not going to be ready to accept product within 2025, actually not until 2027,” said managing director Sean Leet, referring to buyers who would pre-purchase some of the hydrogen. He added that buyers face challenges developing new technologies to ship, process, and transport hydrogen by pipeline at its final destination, reports Reuters.
In response to this story, the company issued a statement clarifying the holdup is with its buyers, not in its own timeline. “Despite news reports of a one-year delay, the project has not been delayed,” it says. “Project Nujio’qonik expects to sign offtake agreements and receive regulatory approval to proceed with development in early 2024, as planned,”
“European offtake timelines have been misinterpreted as a project delay,” it adds. “Offtakers have indicated that the physical infrastructure for receiving renewable energy, via green ammonia, in European markets will not be in place until late 2026, at the earliest.”
World Energy GH2 now expects to start production in 2026. Reuters says the project still needs approval from Newfoundland’s environment department and awaits strong pre-purchase interest to attract financing. The delay raises questions about the general viability of the green hydrogen industry’s presence in Atlantic Canada and Canada’s agreements to sell the fuel overseas.
An affiliate of Boston-based renewable fuels producer World Energy, World Energy GH2 is one of several that are spearheading green hydrogen projects in the region, like EverWind Fuels and Bear Head Energy in Nova Scotia. The companies are part of what some say is a “green-hydrogen rush” prompted by Canada’s 2022 agreement to export green hydrogen to Germany starting in 2025.
So far, EverWind CEO Trent Vichie says his company remains on track to start production in 2025.
But advocacy groups like EnviroWatch NL are questioning the efficiency of a plan to build wind turbines in Canada to make hydrogen for export overseas, writes the Globe.
Other critics have been more blunt.
Last year’s green hydrogen announcement by Prime Minister Justin Trudeau and German Chancellor Olaf Scholz was “frankly, truly ridiculous, because there is no way of getting hydrogen from Canada to Germany,” Michael Liebreich, a member of the United Kingdom Board of Trade and former sustainable energy advisor to the United Nations, told Nova Scotia journalist and occasional Energy Mix freelancer Joan Baxter.
By Liebreich’s reckoning, the transportation and energy costs of shipping green hydrogen to Europe don’t add up. Converting bulky, gaseous hydrogen into its more transportable liquid state already requires 40% of the energy provided by the hydrogen itself, and shipping containers for liquid hydrogen are quite expensive.
Liebreich says that, when pressed on the matter, proponents point to ammonia as a solution, since it is easier to ship. But this raises its own issues, as the shipped ammonia arriving in Germany is then used either for “clean, expensive fertilizer” or for conversion back into hydrogen—a process that then loses an additional 20% efficiency.
The hype around the green hydrogen industry has prompted a proliferation of subsidies and government support for such projects. But before going all-in to develop wind farms to transport hydrogen to Germany, Liebreich says Canadians need to answer some important questions about their own needs.
Why not “decarbonize the power system in Canada and in Nova Scotia first, since that’s a much better use of that green electricity?” he asks. Or why not “switch to and then increase heat pumps and electric transportation first, because those are so much more efficient.” And shouldn’t “the dirty hydrogen from the Canadian refineries and the Canadian fertilizer production” be displaced before selling green hydrogen abroad?
Lewis Cleverdon 
For all there is widespread distrust of the latest round of hydrogen hype, and growing critique of its impracticality, there seems to be little published evaluation of a fossil lobby game-plan for grey and blue hydrogen. At present we are sleepwalking into a very damaging outcome.
Western politicians have boosted commitments to hydrogen beyond any rational analysis of actual need, to include road and offroad vehicles, shipping, aviation, domestic heating, light industrial heat, smelting, iron foundries and cement, as well as it being stored in vast quantities for nations’ Strategic Energy Reserves. Of all these, only the heavy industry options have not yet seen preferable options presented. Some, such as the shipping industry, are already switching to fuelling with Green Methanol both in orders for ~200 newbuild vessels and in retro-fitting extant ships.
However, with very heavy state subsidies for hydrogen already promised, the outlook is of major infrastructure investments to lock in very sub-optimal hydrogen dependence, for instance in mega-scale synthetic kerosene production (aka SAF), in heavy industries and in Strategic Energy Reserves. While that dependence is being established at large scale, we are told that green hydrogen will become so cheap that it will drive the fossil-sourced CO2e-heavy supplies off the global market.
Many people, including some activists and politicians, are seduced by that happy vision of green hydrogen displacing swathes of current fossil fuel usage, since there is scarcely any overall critique of it as a deceit and a mirage. Consider, it wholly ignores the fossil energy industry’s incentive for, and expertise in, developing cheaper production processes for its products. There are at least three potential routes for fossil hydrogen cost savings to retain its cost-competitiveness and so its long-term global market share, including the scores of millions of tonnes it sells to non-energy industries.
First, there is the fully predictable cut in the price of natural gas as feedstock for hydrogen, as gas is displaced by renewables, including the new “closed loop” Geothermal CPH that can be sited anywhere to serve “District Domestic Heating” grids as well as supplying dispatchable power. Various petrostates’ economies rely on gas sales to the extent that they will continue sales even at only marginal profits over operating costs. Gas prices are a major fraction of fossil hydrogen costs.
Second, there is the novel technique where hydrogen is extracted from natural gas by pyrolysis (using some gas for the heat input) rather than by steam reforming. This leaves not CO2 but plain carbon in a powder form, which is easily deposited in disused mines and quarries, or sold for industrial uses. While this avoids the substantial costs of getting CO2 into geological storage, thereby cutting the hydrogen sale price, it does nothing to reduce the inevitable fugitive methane emissions problem. The pyrolysis technique got a little press some years ago, but it seems rather a tabu subject since the Paris Accord.
Third, there is the foreseeable combination of low-cost gas serving as feedstock for gas-pyrolysis hydrogen plants to gain the advantage of both modes of cost savings, and thereby to retain the competitive edge over green hydrogen for the long term.
If at that point societies are committed by their over-hasty widespread infrastructure investments to hydrogen dependence, it would be a difficult, prolonged and costly process to end that malign dependence, if it were affordable at all. In this light we have only a brief period of opportunity in which to hold the hydrogen hype up to scrutiny, in particular by demanding official answers to the question of just how far the mass production costs of fossil hydrogen can be cut to retain its global market dominance ?