Welcome to Motion - Discussing what matters, a video series covering hot topics across the country where our experienced lawyers provide timely legal analysis on issues relevant to Canadians.
This episode focuses on green hydrogen, a clean energy carrier whose commercial potential many say is vast, but which remains largely untapped.
Hydrogen could play an important role in the decarbonization of the global economy and the fight against climate change. Australia, France, Germany, the United States, China and South Korea are just a few of the countries that plan to invest significant sums in hydrogen projects over the next few years, in a market worth billions.
Earlier this month, the Canadian federal government's carbon-pricing policy took effect in Ontario, Manitoba, New Brunswick and Saskatchewan. The move follows a commitment by Ottawa to reduce the country's greenhouse gas emissions and meet its 2015 Paris Agreement targets.
In this video, Matt Keen, one of our Vancouver-based energy regulatory partners, explains why stored hydrogen is still not a widely adopted solution, what needs to happen to spur investment in hydrogen projects and why investors should take interest in green hydrogen storage.
1: Stored hydrogen has been touted as an energy supply solution for a while. Why has it not been widely adopted?
Hydrogen has been the fuel of the future for quite some time. I remember me hearing that growing up in the 80s. I think the answer to your question though is relative cost. And that breaks down in two ways. First, now people are more willing to pay to avoid environmental impacts from their purchases and their choices. And as a result of that, government is pricing carbon and engaging incentives for things like energy storage. And so once you've got more energy storage options available and economic in the market hydrogen becomes something that's very much of interest to designers. But the challenge has been and remains competing with other alternative technologies whether it's incumbents that are cheaper or new technologies that have really caught on. Examples would be a natural gas-fueled vehicles or new battery storage technologies.
2: What needs to happen to spur investment in hydrogen projects?
First, government needs to stay the course when it comes to pricing carbon and creating incentives that will help investors and inventors keep trying to build better mousetraps when it comes to hydrogen technology. Let me give you an example. The government of British Columbia has just came out with its clean B.C. program that contains a variety of initiatives designed to help B.C. and Canada meet the 2030 Paris accord commitments. Under that program a low carbon fuel standard targets more investment into hydrogen-powered vehicle fleets. Now the availability of a hydrogen vehicle fleet and potential synergies with that fleet is something to consider when choosing between different energy storage designs, whether it's hydrogen or for example lithium ion battery technology. So in addition to things like a low carbon fuel standard, which exists in multiple jurisdictions, something else government ought to do is ensure that innovation in hydrogen is something that is still part of targeted R&D spending.
3: Why should investors take an interest in green hydrogen storage?
Energy storage broadly offers us a way to take our existing lifestyle, our existing infrastructure and decarbonise it and make it more sustainable. It's a way to time shift electricity generation. There are times when the wind blows or the sun shines and the grid doesn't need the power that's generated. What you can do with that extra power is split freshwater molecules into hydrogen and oxygen. And once you have that you can do a couple of different things. You can take those components and put them back together with an electrolyser and take the electricity that's generated in that process with the fuel cell and put it back onto the grid at a time when it is needed, or you can take that hydrogen and use it to fuel fleets of hydrogen-powered vehicles or you can even put it into ammonia and fertilizer. So for Canada we have abundant hydro-electricity resources. We have more and more renewable electricity generation on our grid in the form of wind or solar. Plus, we also have a lot of freshwater resources so we can take those existing assets and then use that to innovate and come up with new technologies and opportunities. It's about finding efficiencies in business cases. It's a really exciting time right now.
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