Chemical suppliers are beginning to work with hydrogen and understand its challenges

Hydrogen is widely recognized as the key to sustainable development, which helps to achieve the EU’s goal of reducing carbon dioxide emissions. This brings some huge potential opportunities for chemical suppliers.

Hydrogen can help decarbonize in many ways. For example, it can be used to decarbonize the process of producing iron and ammonia, or to convert carbon dioxide back into hydrocarbons.

However, there are still some challenges to be addressed before hydrogen is widely used in commerce. In the process of decarbonization, the use of hydrogen mainly depends on the “renewable hydrogen” produced by using renewable energy. However, replacing existing fossil fuel based hydrogen production with renewable energy based production will need to reduce the cost of this renewable energy. Conversion losses – which occur in the production, compression, storage, transportation, and ultimately the conversion of hydrogen into electricity – are also important.

These challenges are real, but they are no different from the challenges that other technologies, from automobiles to computers, face and overcome in their early stages of development. Efforts to address renewable energy costs and conversion losses are ongoing, and we are now seeing more and more projects focusing on renewable hydrogen. These include the EU’s hydrogen strategy, which calls for an additional 8000 gigawatts of renewable hydrogen power generation capacity and the production of 10 million tons of hydrogen by 2030. In addition, many countries, from France, Germany, the Netherlands and Spain to Canada, Japan, Australia and South Korea, have recently announced hydrogen energy plans.

For the chemical industry, the development of renewable hydrogen may create several huge opportunities. For example, hydrogen can be used to replace fossil fuel combustion and convert carbon dioxide into syngas, which can be used to synthesize methanol, aromatic compounds or other basic chemicals, such as ethylene, propylene or benzene.

Chemical suppliers may also find opportunities to play various roles in the emerging renewable hydrogen value chain, such as providing materials for electrolysis and energy production methods, or operating hydrogen related processes, such as running electrolysis plants or providing hydrogen storage. The chemical industry can have a particularly significant impact by promoting decarbonization in other industries, for example, by providing them with hydrogen and reducing CO2 emissions.

Ultimately, chemical suppliers who start working with hydrogen and understand its challenges and potential will be better placed to leverage it in its development – and help build an increasingly important role in Europe and the world.

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