The production of hydrogen has been undergoing a transformation in recent years. The hydrogen industry is moving towards a more sustainable future, and this has led to the development of new methods to characterize the production of hydrogen. One of the most significant developments in this regard is the use of colors to describe the source of the hydrogen. However, this approach has now been replaced by a new standard, which takes into account the carbon dioxide (CO2) emissions linked to hydrogen production, as laid out in the IRA 45V.
Traditionally, the hydrogen industry has relied on fossil fuels such as natural gas to produce hydrogen. This method is known as grey hydrogen, and it is the most commonly used method of hydrogen production in refineries from the 60s. However, as concerns over climate change have grown, the industry has begun to explore more sustainable alternatives.
One of the most significant developments in this regard has been the introduction of green hydrogen. Green hydrogen is produced using renewable energy sources, such as wind or solar power, and is therefore considered to be carbon-neutral. This means that the production of green hydrogen does not result in any carbon emissions. We know, that from a life cycle standpoint, almost no activity is fully carbon neutral.
However, the use of colors to describe the source of hydrogen has led to confusion and a lack of standardization within the industry. For example, some companies have used terms like blue or turquoise hydrogen to describe hydrogen that is produced using natural gas but with carbon capture and storage (CCS) technology. Other companies have used terms like yellow or brown hydrogen to describe hydrogen produced using coal. This confusion has led to the introduction of a new standard, which takes into account the carbon dioxide emissions linked to hydrogen production.
The IRA 45V PTC sets out guidelines for the production of hydrogen, which take into account the carbon footprint of the hydrogen production process. This means that hydrogen is now classified according to the level of carbon emissions associated with its production.
Previous the IRA, other attempts to better classify hydrogen leaded to four categories: green, blue, turquoise, and grey. Green hydrogen is produced using renewable energy sources and is considered to be carbon-neutral. Blue hydrogen is produced using natural gas, but with CCS technology to reduce carbon emissions. Turquoise hydrogen is produced using natural gas with CCS, but with the additional use of renewable energy to power the CCS process. Finally, grey hydrogen is produced using fossil fuels without any CCS technology.
Entering a more detailed and defined way to classify hydrogen
The use of carbon emissions to classify hydrogen production makes much more sense than the previous system of colors. It provides a clearer and more transparent way to understand the environmental impact of hydrogen production. This is particularly important as the demand for hydrogen grows, and there is a need to ensure that the industry is sustainable and environmentally friendly. IN the following table we can see the different levels of carbon emissions in terms of CO2e per kilogram of hydrogen produced as well as the PTC rate used per category.
In conclusion, the hydrogen industry has undergone significant changes in recent years. The move towards a more sustainable future has led to the development of new methods to characterize hydrogen production. The use of colors to describe the source of hydrogen has now been replaced by a more transparent system, which takes into account the carbon emissions associated with hydrogen production. This will help to ensure that the industry continues to grow in a sustainable and environmentally friendly way.