Grey, blue, green: The chromatics of a hydrogen economy

The French author Jules Verne’s classic science fiction novels have beguiled readers for over 150 years. Among the many characters he has immortalised, Cyrus Smith, the ingenious engineer from The Mysterious Island, stands out for his prophetic postulations about a futuristic fuel source. To recall the words of this Vernian protagonist, “I believe that water will one day be employed as fuel, that hydrogen and oxygen which constitute it, used singly or together, will furnish an inexhaustible source of heat and light...”

Little did the world realise that this fictional hypothesis would one day come to fruition in the form of a hydrogen economy. Indeed, in a rare coinciding of fact and fiction, humans today are exploring the possibility of using hydrogen as a low-carbon alternative to fossil fuels. Its versatility as a clean energy carrier has been particularly attractive for governments, as they seek to accelerate their decarbonisation agendas.

However, as pointed out by climate scientists, not all hydrogen is created equal. Depending on the production techniques employed, its carbon emissions may vary significantly. Against this backdrop, it is critical to establish an international certification system that allows consumers to track and verify the carbon footprint of hydrogen generation.

A hydrogen rainbow

There is little dispute that hydrogen when combined with oxygen in fuel cells, can release heat without harmful emissions. The only by-product is water, making it a critical energy vector for net-zero economies. However, the climate benefits of hydrogen are also predicated on its production process. If the methods for generating it are not emission-free, then it can hardly be deemed a clean substitute for fossil fuels. Therefore, policymakers need to account for the full lifecycle of greenhouse gas (GHG) emissions in hydrogen production, encompassing upstream activities like steam re-formation or electricity generation, and downstream functions like transport and distribution.

In this regard, organisations like the International Renewable Energy Agency have devised a useful nomenclature, based on colour gradients, to evaluate the environmental impact of hydrogen generation. For instance, when hydrogen is extracted from natural gas using steam methane re-formation (SMR), it is classified as ‘grey hydrogen’. Although carbon-intensive, it remains the most commonly used process, as low-carbon technologies are not necessarily cost-competitive.

When the same SMR technique is employed with carbon capture and sequestration, the resultant product is referred to as ‘blue hydrogen’. It has a low-to-moderate carbon intensity. Similarly, the colour ‘green’ is used to signify the extraction of hydrogen from water, using electrolysis powered by renewable energy. Currently accounting for less than 1% of the total hydrogen production, it is often touted to be the ‘future of clean energy’.

Despite its obvious advantages, the large-scale deployment of green hydrogen is weighed down by high production costs and the capital expenditure of electrolysis units. Only technological innovation and economies of scale can eventually drive down these prices. Until then, the more cost-efficient blue hydrogen is expected to be a part of the energy mix, playing a transitional role in net-zero economies.

Quality Standards

While the carbon footprint of blue hydrogen may be relatively less than grey hydrogen, climate activists assert that SMR prolongs fossil fuel usage and ‘locks’ nations into a future of methane leakages. As a result, countries are under increasing pressure to prioritise green hydrogen, despite cost constraints. There is, however, no internationally accepted system to verify the renewable credentials of hydrogen.

Given that all hydrogen molecules look alike, it is entirely possible for unscrupulous producers to pass off grey or blue hydrogen as clean energy. In this context, there is a clear and pressing need to institute uniform certification schemes that allow consumers to trace the origin of hydrogen. If climate concerns have indeed driven them to spend more on green hydrogen, it is only reasonable that they get their money’s worth. Authenticating the hydrogen quality may also be critical for claiming tax rebates or other ‘green’ policy incentives.

Currently, countries and organisations have formulated their own standards, such as Australia’s Hydrogen Certification Scheme or EU’s CertifHy project. However, these may not necessarily be compatible with each other.

Depending on the baselines used for emission intensities or GHG savings, the definition of blue, green and grey hydrogen can vary considerably. Such discrepancies can also hinder global trade and complicate the market-based pricing of different shades of hydrogen. More worryingly, governments and businesses may get away with setting the lowest possible benchmarks for themselves, while projecting a veneer of climate consciousness.

Consequently, it is important to establish a uniform ‘Guarantee of Origin’ scheme at the international level, which harmonises certification standards and attests to the low-carbon bona fides of a hydrogen product. To track the audit trails and preserve supply chain integrity, new technologies like blockchain can also be used.

As India prepares to scale up green hydrogen production, a uniform certification system would be in its best interests. In fact, the country has already lobbied for common quality standards at multilateral forums like the BRICS Green Hydrogen Summit.

Going forward, such sustained efforts will be key for India in establishing itself as a responsible norm-setter in the field of environmental jurisprudence.

(The writer is a Policy Research Associate with Synergia Foundation, Bengaluru)