Hydrogen offers an exciting opportunity to revolutionize our energy systems and is a powerful tool to reduce greenhouse gas emissions in hard-to-abate sectors. Hydrogen blending is one application that’s becoming more important as we strive to decarbonize natural gas usage. This shift has the potential to significantly reduce carbon footprints, offering an attractive alternative to conventional electrification.
The allure of hydrogen is not limited to its environmental benefits; it extends to a vast economic landscape. The global market potential for green hydrogen is estimated to be well over US$1 trillion by 2050. This monumental figure underscores hydrogen’s tremendous promise. Governments are also making bold policy and investment decisions to provide their citizens and economies with affordable, reliable, low-carbon energy – leveraging the potential of hydrogen blending with natural gas.
Addressing the challenges and limitations of hydrogen blending requires a deliberate approach fully focused on de-risking projects, through stakeholder engagement that will facilitate regulator and public acceptance, as well as significant testing. This strategic step forward will use existing infrastructure, capitalizing on the extensive network of natural gas pipelines spanning over 3.5 million miles in North America.
GHD has explored this issue in-depth in its recently released H2 Now report, which took a deep dive into (1) market readiness for hydrogen blending, (2) the role of communities and stakeholders to advance the technology, and (3) how to implement hydrogen into existing pipeline infrastructure.
Market readiness
Several key questions must be examined as companies consider the implementation of hydrogen blending. Challenges and limitations must be understood, as well as the steps needed to overcome them.
One of the critical milestones in this transition is blending hydrogen in natural gas systems. Hydrogen blending is the injection of hydrogen into existing natural gas systems using widespread traditional infrastructure to provide cleaner energy to end users, such as power plants, industries, businesses, and communities.
The hydrogen sector has advanced significantly over the past several years, and we are seeing its progress in action. Technological advancements, infrastructure developments, sectoral demand, and end-user adoption help show reassuring signs of the hydrogen industry’s advancement and readiness for widespread commercialization.
Technology and infrastructure advancements
Advancements in hydrogen production, storage, and utilization technologies are notable, including significant progress in more efficient and cost-effective electrolyzers and fuel cells. Establishing dedicated hydrogen delivery infrastructure within existing gaseous networks ensures reliable hydrogen transportation to end users, facilitating the industry’s scalability and market penetration.
Today, blend rates of 5–20% hydrogen in existing gas distribution networks can be achieved without adversely affecting existing end-use industrial equipment and commercial and residential appliances. For conventional natural gas consumers, hydrogen and methane can be used for power generation and heating, effectively introducing hydrogen into society.
The demand for hydrogen is not confined to a single sector; it extends to industries like steel, transportation, cement, heating, and agriculture. These sectors actively seek clean energy solutions, creating a strong market pull for hydrogen-based alternatives. Hydrogen blending – alongside other hydrogen applications such as fuel cell-powered vehicles for heavy transport, marine, and rail – plays a pivotal role in decarbonizing these emissions-intensive industries.
Investment and funding inflows
Growing financial support from governments, investors and venture capitalists highlight the market’s confidence in hydrogen’s potential. In policies such as the U.S. Inflation Reduction Act, there are incentives for hydrogen production, distribution, and consumption, fostering a conducive environment for market growth and stability and an influx of investment on the private side. Collaborative partnerships are also forming between key industry players, research institutions and governments to address technical, regulatory, and market challenges – helping to align stakeholders and propel the industry forward.
The urgency for investment in hydrogen projects today is greater than ever, as shown by the rebound of carbon emissions to above pre-COVID levels and the supply chain issues caused by geopolitical tensions. However, Canada and the U.S. still need greater investments to be on track for net-zero emissions by 2050. In both countries, we have seen the introduction of strong incentives for industries with high carbon emissions to transition to hydrogen-based solutions. This has been a driver of rapid decarbonization. Policies that reward emissions reduction through hydrogen adoption, such as incentives, tax credits and carbon pricing mechanisms, can stimulate demand and market growth. The Inflation Reduction Act is a great example of a policy glued to incentives.
Developing globally recognized standards and certifications for hydrogen production, storage, transportation, and utilization can enhance confidence in the industry’s safety, reliability, and interoperability. These standards can streamline regulatory processes, encourage investments, and ensure consistent application and quality across the hydrogen value chain. The number of dedicated research and development centers focused on hydrogen has also been progressing steadily.
Decreasing hydrogen production costs
While low-carbon hydrogen cannot yet compete with traditional energy sources, significant cost reductions can be achieved through advancements in renewable energy sources, carbon capture and storage technologies, and economies of scale.
The overall cost of transitioning any natural gas delivery system, whether by blending hydrogen into existing pipelines or directly incorporating hydrogen into end-user applications, involves two main components: the capital investment and the cost of the delivered hydrogen. The capital investment includes the costs of blending equipment, pipeline modifications, and the evaluation and testing program to demonstrate safe and reliable use. To assess the cost-effectiveness of this transition, we need to compare the cost of hydrogen at the blending point to the cost of natural gas on an energy equivalence basis (for example per million British thermal units – MMBtu). Once this energy equivalence is established, any additional cost of hydrogen above this equivalence reflects the expense of reducing carbon emissions, measured in dollars per ton of CO2 removed.
Parameters affecting blending equipment capital costs include:
- Hydrogen storage (either as cryogenic liquid or gaseous);
- Blending equipment, including hydrogen and natural gas flow control and measurement, hydrogen leak detection, instrumentation and controls, electrical, piping, and other mechanical equipment, structural, and any new buildings;
- Civil and other site preparation; and
- Site permitting and any other hydrogen-specific codes and standards.
Hydrogen can be sourced from third-party suppliers as gaseous or cryogenic liquid hydrogen. On-site hydrogen can also be produced via electrolysis and can be stored for further blending or blended directly into the natural gas delivery system. Producing hydrogen on-site can reduce overall hydrogen costs and, in turn, overall decarbonization costs if the hydrogen can be created and blended directly into the natural gas distribution system, thus eliminating the need for compression or significant hydrogen storage.
The availability of end-user equipment and appliances, such as hydrogen boilers and furnaces for residential use, highlights the industry’s progress and consumer acceptance of sustainable energy solutions. Some existing equipment has been proven to be hydrogen ready up to certain amounts, while other equipment is being retrofitted to allow hydrogen use, and new equipment is being developed to allow up to 100% hydrogen use.
Clear path forward
The Pipeline Research Council International (PRCI) has consolidated research results from around the globe to help establish a clear path forward for hydrogen blending. In 2021, GHD led a study with direct involvement from 20 gas companies and research institutes in North America, Europe and Australia. The study analyzed state-of-the-art hydrogen blending, identified gaps and prioritized recommended research on various technical topics, including pipeline integrity, safety, metering, network management, underground storage, and end uses in high-pressure and low-pressure distribution systems.
Creating a controlled environment for testing and deploying hydrogen technologies can accelerate their integration into existing energy systems. This allows asset owners and innovators to test different equipment and experiment with new solutions while regulators monitor and adapt frameworks accordingly.
By seizing these opportunities in tandem with the signs of industry readiness outlined earlier, the hydrogen sector can hasten its path to commercialization and position itself as a transformative force in the global energy landscape. These complementary strategies can collectively unlock the full potential of hydrogen, enabling it to address complex energy challenges and contribute to a sustainable future.
Hydrogen’s growth is evident, with over 600 large-scale hydrogen projects in development, according to the Hydrogen Council. These projects include pipeline blending pilots that test small amounts of hydrogen in working gas systems, and research projects focused on hydrogen blending at higher volumes in utility testing facilities. In the context of commercial business readiness, the transition to a sustainable and low-carbon future hinges on the successful commercialization of the hydrogen industry. Commercial businesses are forging a path forward, solidifying hydrogen as a mainstream energy source.
Community and stakeholder readiness
Launching comprehensive public awareness and education campaigns can demystify hydrogen technologies, dispel misconceptions, and foster acceptance among consumers and other stakeholders. These campaigns can highlight the benefits of hydrogen adoption and address concerns related to safety and feasibility. Stakeholder engagement is crucial for hydrogen blending projects, as it fosters public acceptance, regulatory compliance, risk identification, and collaboration.
Engaging stakeholders such as communities, environmental groups, and industry representatives allows project developers to understand concerns, address them transparently, and build support. It also helps fulfill regulatory requirements and ensures environmental and safety standards compliance. By involving stakeholders early, developers can identify and mitigate potential risks, manage concerns, tap into local knowledge, and enhance project outcomes through collaboration and partnership. Concerns about both safety of hydrogen blending and how it will impact household energy costs for residents should be anticipated.
GHD’s ‘Shocked’ study reveals that 70% of C-Suite respondents from the global energy sector agreed with the statement that community opposition is one of the largest obstacles to getting new clean energy projects approved. The findings demonstrate that how the community perceives these projects – either positively or negatively – has the potential to significantly impact progress towards a net zero future.
Determining infrastructure readiness
Risk assessments that evaluate all potential threats and consequences will determine the feasibility of hydrogen blending and determine what upgrades to a system must take place before implementation can begin. Any needed changes should be made to operating envelopes, O&M procedures, and design records to reflect operating fluid and equipment changes. Approvals for change in service may be required for pipeline fluid changes.
Blending hydrogen directly into existing natural gas pipelines requires careful consideration for safe and efficient operations. Pipeline compatibility is crucial, as materials used in older pipelines may need assessment and potential upgrades to prevent issues related to hydrogen embrittlement. Blending ratios, which determine the amount of hydrogen needed in the mixture with natural gas, should be optimized to balance emissions reduction and safe combustion.
Quality control measures ensure the purity and consistency of the hydrogen being blended. Safety protocols, such as leak detection systems and risk assessments, are key and need to be modified appropriately as hydrogen has different properties than natural gas. Regulatory compliance with local requirements is essential, and monitoring systems and regular maintenance help track the blending process and ensure system integrity. It is estimated that the cost of repurposing existing pipeline assets for hydrogen service is 10–20% of the cost to build new infrastructure.
Hydrogen differs from natural gas, and its molecular properties impact how existing gas infrastructure might be repurposed. One of the most critical safety controls is to quantify the impacts of hydrogen on pipeline materials. Beyond the pipeline materials, an inspection of facilities and pipeline assemblies is required. To ensure a smooth and safe transition, updating design records, evaluating fitness for service, and producing operating and maintenance procedures are required. Transmission pipelines pose unique challenges for transporting hydrogen and hydrogen blends compared to natural gas. The impacts of hydrogen increase, and in many cases accelerate, with increasing hydrogen blends and operating pressures. Therefore, it is imperative to do comprehensive tests and trials to ensure the blending operations are functional.
Among key assessments needed to determine pipeline integrity and compatibility for hydrogen blending are:
- Checking for levels of fracture toughness: Hydrogen can diffuse into pipeline steel, reducing toughness and ductility and accelerating fatigue crack growth rate. Monitoring toughness reduction and crack growth rate is critical.
- Pipeline composition: The impacts of hydrogen on steel can vary based on the composition and microstructure. Pipeline workmanship and integrity conditions must be evaluated at the proposed operating condition, as hydrogen can cause embrittlement of many other materials used in transmission systems, including high-strength steel alloys, martensitic steels, and nickel alloys.
- Monitoring hydraulic behavior: Hydrogen has a lower energy density and different thermodynamic properties than natural gas, which changes the fluid’s hydraulic behavior as the blend increases. Higher gas velocities in piping pose different stress, vibration, and acoustic induction issues.
- Inspect sealing materials: Hydrogen is a much smaller molecule than methane, meaning leaks from stems, joints, and closures are higher.
One compelling case study is the PG&E Hydrogen to Infinity project in Northern California, which intends to study the feasibility of blending hydrogen from a nearby production facility into full-scale pipeline loop and associated equipment mimicking the existing transmission systems that will need to be used. To do this, in collaboration with industry and other partners, they will conduct tests in three major components:
- A full-scale pipeline loop – built and operated as real-world natural gas transmission pipelines are, but completely standalone so that tests can be run safely;
- Full-scale destructive-testing facilities – constructing facilities to enable equipment compatibility and leak materials and integrity testing, pushed to the point of destruction to help identify safety limitations; and
- Laboratory testing – advanced research and testing facility control center and digital infrastructure for monitoring and controlling the pipeline and testing equipment.
Looking forward
As the hydrogen blending industry advances – and with proper preparation, communication with stakeholders and testing of pipeline residence – the number and scale of projects will continue to increase significantly as a vital component of the hydrogen economy, driving decarbonization across many industries, businesses, cities, and communities.
