New Energies, new possibilities

AES Chile has submitted the Environmental Impact Study (EIA) for the INNA project, its first industrial-scale green hydrogen and ammonia initiative in the country. The project, located in Taltal, Antofagasta region, which is in an initial development stage, is aligned with Chile's National Green Hydrogen Strategy.

"Although this project is in an early stage of development and the investment decision will have to be made later, the presentation of the EIA is a fundamental step to ensure the viability of the initiative," said Javier Dib, General Manager of AES Andes.

"AES Chile is accelerating the future of energy, creating opportunities that diversify Chile's energy matrix and support the country's sustainable energy goals. As with all of our projects, our partnership with local communities and stakeholders is a priority. We want to strengthen local development, while maintaining the highest environmental and safety standards," Dib continued.

To support this project, a Memorandum of Understanding (MOU) was signed between AES Andes and Samsung C&T, a major Korean company with experience in energy and construction, which was recently awarded the contract for the first green ammonia receiving terminal in Korea.

The two companies are currently evaluating the joint development of the project, focusing on opportunities to produce green hydrogen for domestic consumption or for export to international markets.

The project submitted to the SEA includes the production of green hydrogen and ammonia, as well as the development of solar, wind and battery storage energy, in line with the needs of the project and to support the country's electricity generation.

"The company has carried out dedicated community engagement work with special attention to the Chango communities present in the area, as well as other relevant actors. We will maintain this commitment to collaborative work as we move forward with the environmental processing of Inna," said Luis Sarrás, Vice President of International Green Hydrogen at AES.

(Bloomberg) -- Green hydrogen has been touted by politicians and business leaders alike as a key fuel for a carbon-free future. But it will remain far more expensive than previously thought for decades to come, according to a new estimate from BloombergNEF.

Hydrogen companies worldwide are already struggling with canceled projects and sluggish demand. In the US, billions of dollars of projects have been stalled waiting for President Joe Biden’s administration to issue final rules for a tax credit meant to spur production.

BNEF had in the past forecast steep declines in the price of green hydrogen, which is made by splitting it from water with machines called electrolyzers running on renewable power. But in its forecast published Monday, the firm more than tripled its 2050 cost estimate, citing higher future costs for the electrolyzers themselves. BNEF now forecasts green hydrogen to fall from a current range of $3.74 to $11.70 per kilogram to $1.60 to $5.09 per kilogram in 2050.

For comparison, the most common form of hydrogen used today — stripped from natural gas, with the carbon emissions vented into the atmosphere — costs from $1.11 to $2.35 per kilogram, according to BNEF. The research firm expects prices for such “gray” hydrogen to remain largely the same through mid-century.

“The higher costs for producing green hydrogen without any subsidies or incentives means it will continue to be challenging to decarbonize hard-to-abate sectors, such as chemicals and oil refining, with hydrogen produced via electrolysis powered by renewables,” said BNEF analyst Payal Kaur.

Those industries along with steel mills and power plants have been tagged as possible end users of the gas. But doing so would require expensive new equipment, which has stunted demand. 

Only two markets — China and India — are likely to see green hydrogen become cost-competitive, according to BNEF. There, the cleaner fuel will reach a comparable price to gray hydrogen by 2040. 

The forecast puts Biden’s goal of driving US hydrogen costs down to $1 per kilogram by 2031 out of reach. Many analysts consider that price essential to convincing potential customers to start using the fuel. BNEF took an in-depth look at how green hydrogen will fare in New York, Texas and Utah. The report found that Texas will create the cheapest green hydrogen but costs will only fall from $7.22 per kilogram today to $4.82 in 2030. If Biden’s planned tax credit of $3 per kilogram is included, Texas hydrogen costs could fall below $1 by 2040, according to the forecast.

The fate of US hydrogen policies remains uncertain, with President-elect Donald Trump set to take office in January. Although industry executives remain hopeful he will continue many of Biden’s initiatives — in part because oil companies are interested in hydrogen — Trump has said little about it. His threatened tariffs on imported products could boost the price of foreign-made electrolyzers, but BNEF’s price forecast did not take tariffs or subsidies into account.

Slow hydrogen demand growth, meanwhile, has forced companies worldwide to scale back their ambitions. Equinor ASA, Shell PLC and Origin Energy Ltd. all canceled hydrogen production projects this year due to a lack of buyers.  

Green Hydrogen Prices Remain High for Decades

Demonstration system for carbon-free generation of electricity with ammonia in high-temperature fuel cells (SOFCs)

Using hydrogen to generate electricity does not cause any climate-damaging emissions. But storing and transporting the gas pose technical challenges. With this in mind, Fraunhofer researchers use ammonia, a hydrogen derivative that is easier to handle, as a starting material. Ammonia is cracked in a high-temperature fuel cell stack, and the hydrogen produced in this process is converted to electricity. The waste heat can be used as heat energy, for example.

There are high hopes for hydrogen and its derivatives as sources of energy. They play a central role in the energy transition component of the German federal government’s National Hydrogen Strategy. Ammonia (NH3) has been identified as having especially high potential, as hydrogen is easier to store and transport in the form of ammonia. A team of researchers with Prof. Laura Nousch from the Fraunhofer Institute for Ceramic Technologies and Systems IKTS in Dresden has developed a demonstrator based on a high-temperature fuel cell stack (solid oxide fuel cell, SOFC) that can use ammonia to generate electricity directly and with high efficiency. Electricity and heat are generated in a single compact system — without CO2 emissions or other harmful byproducts.

© Fraunhofer IKTS--Schematic of the principle behind an ammonia SOFC system

Ammonia becomes hydrogen, hydrogen becomes electricity

Fraunhofer researcher Laura Nousch explains the advantages of this method: “Ammonia has been used in the chemical industry for decades, for example to produce fertilizers, so there are established and familiar processes of handling this substance. However, it still needs to be treated with caution. As a hydrogen carrier, ammonia offers high energy density, and at the same time it is relatively easy to store and transport. Ammonia is an ideal starting material for climate-friendly generation of electricity and heat energy.” In the process, ammonia is first conditioned and fed into the cracker, where it is heated to temperatures of 300 degrees Celsius or higher. In response, it breaks down into hydrogen (H2) and nitrogen (N2). When the process is completed, the nitrogen can simply be released together with water vapor as harmless exhaust gases. Then, the hydrogen is fed into the high-temperature fuel cell. In the ceramic electrolyte, it flows over the anode, while air streams pass the cathode. Splitting the hydrogen releases electrons that move from the anode to the cathode. This is how electricity starts to flow. In addition to water vapor, this electrochemical reaction also produces thermal energy. The afterburning also generates heat. “The heat is used to maintain the high temperature inside the cracker and is also released as waste heat. The latter can then be used for purposes

High efficiency by 60 percent

When designing the system, the researchers at Fraunhofer IKTS drew on their decades of expertise in working with ceramic fuel cell stacks. The team was able to build a fuel cell demonstrator that handles the entire process of breaking ammonia down into hydrogen and subsequently generating electricity from it all in one device. The efficiency of this method, just like those based on natural gas, stands at 60 percent, but with the difference that ammonia SOFC systems are comparatively simple and robust in structure. The system is perfect for smaller industrial companies that want to generate electricity without carbon emissions but are not connected to the future core hydrogen network, or for municipalities and local utility companies looking to supply green heat to their customers. Even large ships can be equipped with ecofriendly drives based on ammonia/hydrogen in this way.

Customized fuel cell systems

The higher the temperature in the cracker, the more of the ammonia is broken down into hydrogen. In turn, at lower temperatures, meaning just over 400 degrees Celsius, a considerable portion of the ammonia remains. “However, our tests showed that the ammonia molecules also break down completely into hydrogen in the high-temperature fuel cell. This can even increase the system’s overall performance,” Nousch says. And that opens up various options for thermal management. “Targeted design and smart thermal management are combined with other modifications to aspects such as the power and the size of the fuel cell stacks. So, we are able to devise customized solutions for climate-friendly generation of electricity and heat, especially for small and medium-sized enterprises,” she explains.

Fraunhofer's NH3 System Hydrogen Technology: Unlocking Climate-Friendly Electricity