D. BAWA, Director of Project Development, New Fortress Energy
H2Tech sat down with Deepak Bawa, Director of Project Development–LNG and Hydrogen Projects for New Fortress Energy, to discuss the roles of blue and green H2 in the energy transition, as well as how blue H2 both complements and competes with the natural gas midstream sector.
An expanded discussion on these and other topics is available in our H2TechTalk podcast interview with Mr. Bawa. Visit blubrry.com/H2TechTalk to listen and subscribe!
H2T. How do you view blue H2’s role in the existing oil and gas energy infrastructure?
DB. In this energy transition period, blue H2will play a crucial role. Overall, we can say that H2 is the “rock star” of the energy transition. In the past, H2 was used mainly for hydrotreating fossil fuels and in chemical production—ammonia, methanol, urea, etc. Now, though, people are looking at H2 as a fuel for the transportation and aviation industries, which is a big change. H2 is being discussed for use in the power, steel and other industries—basically, wherever we have been using fossil fuels.
Of all the different “colors” of H2, blue H2 is the most balanced. Gray H2 from reforming of natural gas is cheap but emits a lot of carbon; green H2 is clean but relies on very low-cost renewable energies to be competitive. Blue H2 sits at a sweet spot where it can be less expensive than green H2 without emitting carbon like gray H2.
As the cost of renewables continues to come down, and as more renewable energy is in use around the world, green H2 will be the future. As we strive to lower emissions during the energy transition, blue H2 presents a viable economic and environmental pathway for doing so.
H2T. Do you see H2 as being complementary to or competitive with the natural gas sector?
DB. Both, actually, but it is more complimentary. Natural gas has its own place in the industry, while H2will be used wherever it is economical to substitute for natural gas. Moreover, H2 can be used in different industries as a feedstock, or as a fuel for transportation and aviation, whereas natural gas is better utilized for heat and power generation.
New Fortress Energy has helped several developing countries switch their power generation from diesel to natural gas. As we transition to green H2, natural gas will continue to be used to produce blue and gray H2.
H2T. What are the present challenges for blue H2 production and application?
DB. Right now, the current challenge is carbon (CO2) capture. CAPEX and OPEX for CO2capture systems are high, and not many companies are interested in buying CO2 for enhanced oil recovery (EOR) when crude oil is around $45/bbl. If you sequester the CO2, under the U.S. government’s 45Q tax credit program you get around $50/ton of CO2, which barely covers the cost of capturing CO2.
I hope that this CO2 credit will be increased in the near future so that the biggest producers of H2 can be motivated to install CO2 capture systems at their existing steam methane reforming (SMR) production plants. Also, the permit required for CO2 sequestration is a lengthy process that takes around 18–24 months. This process should be expedited. If the CO2 tax credit is increased to $70/t–$80/t and a sequestration permit is provided in 6 months, then it can change the scenario for carbon capture in the U.S.
H2T. More broadly, what part do you expect blue H2 to play in the global energy transition?
DB. Blue H2 is a viable bridge solution because the CO2 is captured, and it is much cheaper than green H2 today. As we move away from fossil fuels to help the environment, we can use blue H2 in different industries as a fuel and in the transportation sector. H2 and electric cars are the future of transportation, particularly as auto manufacturers start to move away from fossil fuels.
For example, California announced that it will not allow fossil fuel cars on California roads after 2035, and the state is already building H2 refueling stations and electric vehicle charging stations. This could be followed in all the states very quickly. First, however, we have to bring down the H2 fuel cost, which is around $15/kg–$16/kg at present. That cost can be reduced with the use of blue H2. If the price of H2 at the refueling station can be brought down to $5/kg, then many people will be ready to buy H2 cars when they know that their weekly H2 fuel bill will only be around $20–$25.
H2T. Can you share any details on the projects your company is working on in this area, and how you anticipate these projects will help advance clean energy technology and use?
DB. New Fortress Energy’s Zero Division was established to help the company meet the ambitious target of our CEO, WesEdens, of becoming a zero-emissions company within 10 yr. The division is committed to making zero-emissions H2 at an affordable price. We are investing in H2 technology startup companies, such as H2Pro, that can lower the cost of producing H2.
For example, H2Pro’s Electrochemical-Thermally Activated Chemical (E-TAC) technology uses renewable energy to split water into H2 and O2 in two phases, using around 30% less renewable electricity than other leading electrolysis technologies. H2Pro is designing lower-cost, modular, scalable systems that use less electricity, do not require membranes or precious metals and can operate at high pressure. We are working to build pilot plants with H2Pro and other companies over the next few years. If all goes as planned, we will scale up commercial projects pretty soon after that.
New Fortress Energy is also working with GE and Black & Veatch to introduce H2 into natural gas turbines at the 485-MW Long Ridge Energy Terminal power plant (FIG. 1) in Hannibal, Ohio. The project is under construction and will begin producing CO2-free power by the end of 2021. It will be the first purpose-built H2-burning power plant in North America. It will also be the world’s first to blend H2 in a GE H-class gas turbine. The Long Ridge plant’s combustion turbine can initially burn from 15 vol%–20 vol% H2 in the gas stream. New Fortress Energy’s Zero Division will continue to work with Long Ridge and GE as they transition the plant to burn 100 vol% green H2 over the next 10 yr.
Fig. 1. The Long Ridge power plant in Ohio will initially burn 15 vol%–20 vol% H2 in its natural gas turbines from late 2021, transitioning to 100 vol% green H2 over the next decade. Photo courtesy of New Fortress Energy.
H2T. With regard to green H2, how do you see it being a success in the future? How will the projects being developed today pave the way for wider-scale use of green H2, and in which sectors?
DB. Many projects are under development, and some are under construction for green H2. Australia and Europe are leading the way in green H2, with a number of announcements of interesting and diverse projects. Several new technologies promise to be much lower in cost than existing ones. As these technologies are developed, we will see green H2at an increasingly affordable price. At this time, green H2 will start to capture more market share than gray and blue H2; however, we need to keep investing in renewables and more pilot projects to achieve the kind of scale that ultimately drives down costs.
DEEPAK BAWA is the Director of Project Development for New Fortress Energy. Mr. Bawa is a Six Sigma Green Belt Certified Project Management Professional (PMP) with significant experience in LNG, chemical plants and refinery projects spanning more than 17 yr. He has led teams of 40–100 people for EPC projects valued at $2 MM–$4 B. In the past, he has worked with companies including KBR, IHI, UOP, TechnipFMC and ISGEC. Mr. Bawa holds a BS degree in mechanical engineering from the Sant Longowal Institute of Engineering and Technology in Punjab, India.
