The role of hydrogen and fuel cells in providing affordable, secure lowcarbon

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1 The role of hydrogen and fuel cells in providing affordable, secure lowcarbon heat Paul Ekins, Paul Dodds, Adam Hawkes, Will McDowall, Francis Li, Iain Staffell, Philipp Grünewald, Tia Kansara, Paolo Agnolucci All-Energy 2014, Aberdeen, UK 21 May 2014

2 Overview The role of hydrogen, and of fuel cells, in providing affordable, secure low-carbon heat in future low carbon energy systems Interdisciplinary Team from UCL and Imperial College: Paul Ekins project lead Paul Dodds, Adam Hawkes white paper editors Will McDowall, Francis Li, Iain Staffell, Phil Grűnewald, Tia Kansara, Paolo Agnolucci authors Project started in November Two review workshops were held in March at UCL and at the H2FC conference in Birmingham.

3 Overview

4 Methods 1. Reviews of the technical, academic and commercial literature. 2. Engagement with core industry stakeholders 3. Comparative analysis of heating technologies complemented by scenario building.

5 Fuel cell CHP technologies PEMFC SOFC PAFC MCFC Application Residential Residential/Commercial Commercial Electrical capacity (kw) Thermal capacity (kw) Electrical efficiency * (LHV) 35 39% 45 60% 42% 47% Thermal efficiency * (LHV) 55% 30 45% 48% 43% Current maximum lifetime 000 hours years Degradation rate Per year 1% 1 2.5% 0.5% 1.5% * Rated specifications when new, which are slightly higher than the averages experienced in practice. Loss of peak power and electrical efficiency; thermal efficiency increases to compensate. Requires an overhaul of the fuel cell stack half-way through the operating lifetime.

6 Global micro-chp deployment

7 Residential PEMFC learning curves: Japan and South Korea

8 Opportunities for future capital cost reductions Reducing system complexity through design optimisation; Eliminating major system components such as fuel processing stages; Cell-level design improvements such as reducing catalyst content and increasing power density; Greater collaboration between manufacturers to standardise minor components and overcome research challenges more effectively; and, Expansion of manufacturing volumes and mass production techniques.

9 Hydrogen for heating Several non-fuel cell heating technologies are available that can potentially utilise hydrogen. Combustion/catalytic boilers, gas heat pumps

10 Hydrogen production and delivery Hydrogen transport options are not well understood, particularly repurposing the existing gas networks: 1. Need a hydrogen transmission network and storage. 2. Could inject hydrogen into the natural gas stream power-to-gas. 3. Could the existing low-pressure gas networks be converted to deliver hydrogen instead of natural gas? Hydrogen production what is green hydrogen? What are the permissible CO 2 emissions from hydrogen production?

11 Scenarios Why have H2FC technologies have not generally appeared in previous long-term decarbonisation pathways?

12 UK heat scenario studies Model Type House categories Heat technologies H2FC UKDCM Stock 20,000 (region, type, age, Base, mchp Yes tenure, fabric, floors) BREHOMES Stock 1,000 Unknown No NHM Stock Unknown Base No* N-DEEM Stock 0 (80 non-residential) Base No NERA/AEA Stock 8 (type, location, fabric) Base No Element/AEA Stock Unknown Base No UK MARKAL ES 2 (age) Base, mchp, hydrogen boilers, fuel cell mchp Yes UKTM-UCL ES 2 (age) Base, mchp, hydrogen boilers, fuel cell mchp, hybrid HPs ESME ES 12 (type, fabric) Base, micro-chp No* AUB Hybrid 26 (type, location, age) Base, mchp, hybrid HPs No RESOM Hybrid 30 (type, location, age) Base, mchp, hydrogen boilers, fuel cell mchp, hybrid HPs, gas heat pumps DynEMo Hybrid 30 (type, fabric, occupants) Base, mchp, hybrid HPs No* Yes Yes

13 UK heat scenario studies 1. Most previous scenario studies of UK heat decarbonisation pathways have not examined fuel cell micro-chp and do not consider the possibility of piping hydrogen to houses. 2. Converting existing gas networks to deliver hydrogen is a strategy that continues the existing system of heat provision that has only been studied in one model. 3. Hydrogen boilers and process heat are more economic uses of hydrogen than fuel cells in some studies.

14 Long-term cost of heat provision Levelised costs of heat provision are similar in 2050 for competing technologies Year Heat technology Levelised cost ( /house/year) 2012 Natural gas boiler Natural gas boiler 1418 Hydrogen boiler 1389 Air heat pump 1054 Stirling engine micro-chp 1679 Fuel cell micro-chp: $4000/kW 1920 Fuel cell micro-chp: $1000/kW 1582 Levelised costs calculated using the UKTM-UCL energy systems model for an 80% reduction in CO 2 emissions in 2050 relative to 1990.

15 Fuel cell micro-chp impact on the electricity system Fuel cells can reduce electricity generation peaks caused by heat pump deployment Optimal fuel cell:heat pump ratio greater than previously thought (2.5:1). Similar impact if transport is electrified.

16 Carbon intensities of heat techs Fuel cells produce lower net emissions than heat pumps until marginal electricity emissions fall to 0.33 kgco 2 /kwh.

17 The UK H2FC industry Strong science base for H 2 FC technologies but international performance in invention is weaker than the leading countries. UK industry has a number of internationally competitive firms, but is not in the first tier of H 2 FC countries. Relative shares of global patents

18 Opportunities and barriers Several UK firms have strong long-term export potential, building on their core technology and market strengths, and building on existing international partnerships. Appropriate financing for new technology-based firms is perceived to be a difficulty for the UK industry by stakeholders. Skills are a problem for fuel cell technology firms and gas engineering companies, who reported difficulties recruiting qualified personnel.

19 Policy issues Four main issues need to be addressed: 1. Existing rules and incentives sometimes exclude H 2 FC where there is no good reason to do so. Implies a need to review existing measures and recommend changes. 2. Fuel cells offer system benefits that are not recognised under current market arrangements. This results in sub-optimal levels of investment, so there may be a case for subsidy support in lieu of (and until) market reform.

20 Policy issues Four main issues need to be addressed (cont.): 3. Investments in technology development and pilot deployment are required to keep long-term options open. Need for data gathering, RD&D and field trials, especially for gas conversion options, potentially critical role of regulation. 4. Action to support H 2 FC now will enable UK firms to develop export strength, with economic benefits for the UK.

21 Conclusions Fuel cell CHP is a reality in several countries and costs are falling dramatically. Yet these technologies are habitually excluded from UK low-carbon heat studies. Fuel cells can help to reduce the costs of supplying electricity in the future. There are opportunities for UK companies, but lack of skilled labour and policy issues need to be addresses first.

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