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An Economic and Environmental Assessment of Hydrogen Production Pathways

Antonia Herzog, Natural Resources Defense Council
Marika Tatsutani, Consultant

Natural Resources Defense Council
issue paper: november 2005



The results of this preliminary assessment highlight a number of significant issues that must be resolved before hydrogen can play a substantial role in addressing the nation’s and the world’s energy security and global warming challenges. Central among these is the fact that the least expensive and most mature hydrogen production pathways available at present are not necessarily environmentally sustainable. For example, one of the cheaper options available today—producing hydrogen from coal—will not be acceptable unless associated global warming, air pollution, and mining impacts are successfully addressed. The deployment of coal gasification technology with carbon capture and storage, in combination with mining practices that minimize land and water impacts, could allow coal to become a sustainable and abundant source of hydrogen over the long term, both in the United States and in other coal-rich countries. However, further aggressive deployment of advanced coal gasification technologies, in combination with carbon capture and storage, is needed to better determine the cost, feasibility, and effectiveness of this potential hydrogen production pathway.

Hydrogen production from natural gas, meanwhile, offers a number of near-term advantages in terms of cost and technological maturity, but it too can prove problematic as a longer-term solution. Because natural gas, like coal, is a fossil fuel, its use as a hydrogen feedstock generates pollutant emissions that contribute to global warming and air quality problems. Data presented in this report (see Figure 1) indicate that per-mile global warming emissions for a fuel cell vehicle running on hydrogen produced using various forms of steam methane reformation are anywhere from 40 percent to 50 percent lower than emissions for a conventional vehicle running on reformulated gasoline. These emissions reductions are not trivial—but it is also the case that comparable global warming benefits could be achieved by simply deploying efficient hybrid-electric and conventional technologies that are already available today. Moreover, high natural gas prices and supply constraints have recently emerged as serious issues that show no signs of being resolved soon, at least in North America.

Thus, natural gas is probably best thought of as a potential transition fuel to cleaner, low-carbon, domestic hydrogen production options, such as renewables or coal with carbon capture and storage. Given the extensive natural gas infrastructure that already exists, use of this feedstock may make sense in the early stages of a possible future shift to hydrogen but even then, natural gas should only be considered in the context of an alternative longerterm hydrogen production strategy, with care taken to address technological lock-in concerns, wherein an inappropriate technology is deployed too early, thereby preventing a better technology from emerging as the longer term solution. Additionally, distributed production from natural gas using small-scale steam methane reformers— because it obviates the need for hydrogen transport—is also an attractive short-term production option, but it is important to keep in mind that this option does not easily allow for eventual carbon capture and storage. Meanwhile, to alleviate supply constraints that might otherwise preclude the use of natural gas as a transition fuel for producing hydrogen, natural gas demand growth should be addressed through improvements in the end-use efficiency of gas equipment; and through the increased use of combined heat and power and other distributed or high-efficiency technologies.

Compared to coal- or natural gas-based production pathways, hydrogen from nuclear energy could offer some advantages in terms of global warming emissions. However, cost estimates of hydrogen production at future…………………….


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