The green hydrogen opportunity in Irish decarbonisation
In December 2023, Bord na Móna marked a key milestone in the company’s history and the final step of its brown to green journey by using peat to co-fire its Edenderry Power Station for the final time.
The plant now runs on 100 per cent biomass while continuing to provide 118MW of renewable electricity to the national energy grid and supporting Ireland’s target of 80 per cent renewable energy by 2030 and net zero emissions by 2050.
As the company leaves its indigenous fossil fuel roots behind, a €100 million investment into Edenderry has transformed it into a 100 per cent renewable baseload power plant that is an integral part of a larger eco energy park vision.
Today, 40 per cent of Ireland’s electricity comes from renewable sources. Bord na Móna’s vision for Ireland’s 2035 energy system incorporates 90 per cent renewables with 10 per cent flexible decarbonised gas generation. That gas generation will be decarbonised using either green hydrogen or biomethane.
Opportunities in green hydrogen
Hydrogen is ‘green’ when electricity produced by renewables is used for electrolysing water. In times when generation exceeds demand, the excess electricity that would otherwise be wasted can be used to produce green hydrogen. The International Energy Agency predicts that global renewable energy capacity could rise as much between 2022 and 2027 as in the previous 20 years, amplifying the challenge of how to use excess energy. Producing green hydrogen during favourable wind and solar conditions for use when conditions are less favourable for renewables could be a solution.
Thermal generators typically use fossil fuels such as natural gas. These generators are required to transition to a net zero power system, so it is vital to decarbonise these by replacing the fossil fuel with a carbon-neutral/carbon-free gas. In addition, these generators benefit the electricity system by providing inertia to stabilise the grid.
The role green hydrogen is expected to play in Irish life is outlined in the 2023 Climate Action Plan, which was published in December 2022. This plan included a target for 5GW of offshore wind by 2030 with an additional 2GW for green hydrogen production. That production is not envisaged until post 2030. In 2023, the Department of the Environment, Climate and Communications (DECC) published the National Hydrogen Strategy which includes actions to deliver our national ambition. One of the key actions is to “develop the commercial business models to support the scale up and development of renewable hydrogen, targeting surplus renewable grid electricity pre-2030 and an initial 2GW of offshore wind from 2030”.
The role of green hydrogen is reaffirmed in the 2024 Climate Action Plan, but the emphasis has changed from having 2GW of offshore wind for green hydrogen “in production” to “under development” by 2030. While the inclusion of green hydrogen in national policy is welcome, the pathways to delivery need to be defined.
EirGrid, Ireland’s Transmission System Operator, reported that 8.3 per cent of the total wind energy available was dispatched down in 2022 as it could not be accommodated by the grid. In the absence of rapid delivery of new grid infrastructure, this electricity will continue to be generated with nowhere to go and could be used to power electrolysers to deliver green hydrogen before 2030 instead. Bord na Móna believes that green hydrogen can make a significant contribution to our 2030 targets if onshore renewables are used for its production.
Wind and solar, by their nature, are intermittent sources of energy and, whilst forecasting is improving, there are times when they do not materialise and result in a ‘Dunkelflaute event’. This lack of wind or solar leaves a significant gap in energy production, presenting a major challenge for an electricity system with high renewable penetration like the Irish system. Using green hydrogen as a fuel to produce electricity during those times is a solid, carbon-neutral solution to this problem.
Green hydrogen also enables the possibility of decarbonising hard-to-abate transportation industries such as aviation, maritime, rail and road haulage by using hydrogen directly as a gas, or for the production of e-fuels. When processed with biogenic carbon dioxide, such as the CO2 captured from a biomass power plant, green hydrogen can be utilised to produce Sustainable Aviation Fuel (SAF) to support the energy transition of the aviation sector.
The 2024 Climate Action Plan aims for a 50 per cent reduction in carbon emissions in the transport sector by 2030. In addition, the EU’s ReFuelEU Aviation initiative requires the proportion of SAF blended with traditional aircraft fuel supplied to EU airports to increase gradually to 6 per cent by 2030 and almost 70 per cent by 2050. Today, Ireland imports all its aviation fuel, demonstrating that much work is needed but so is the potential for massive gain. A 2023 feasibility study by SkyNRG and SFS Ireland concluded that by 2050, Ireland could generate approximately €2.55 billion in revenues and create around 1,000 skilled jobs by producing indigenous SAF.
In an increasingly volatile and uncertain world, the security of supply is now at the forefront of many minds. The Sustainable Energy Authority of Ireland’s (SEAI) Energy in Ireland Report 2023 highlighted that the State imports 81 per cent of its energy, most of which is fossil fuel.
Green hydrogen could replace the dependency on imported fossil fuels with indigenous production, facilitating energy security and, given Ireland’s renewable energy potential far exceeding its demand, even opening up the potential for future export markets. Ireland has a golden opportunity to move from energy consumer to energy supplier on the world economic stage.
These renewable energy and green hydrogen opportunities can also indirectly benefit the people of Ireland as an emerging energy industry generates growth, becomes a catalyst for innovation and creates jobs, often in rural areas supporting regional investment.
Strategies for green hydrogen adoption
The Government released its National Hydrogen Strategy in July 2023, a policy statement on renewable hydrogen that sets out its long-term vision. Bord na Móna’s green hydrogen strategy is closely aligned with the Government’s objectives and this year the semi-State has achieved an important step in its three-phase strategic approach.
Phase I of Bord na Móna’s three-stage approach includes the development of a 2MW green hydrogen pilot project at the Mountlucas Wind Farm in County Offaly. The project was granted planning consent in May 2023, and work is progressing on commercial development.
The original plan to move on to Phase II of the Bord na Móna hydrogen strategy, involving the development of medium-sized projects, has been re-evaluated in priority terms with a shift to focus on Phase III, large-scale production of green hydrogen and potential production of SAF.
One of the main drivers for Bord na Móna’s change in focus is the clarity brought by the National Hydrogen Strategy in terms of end-uses for green gas, particularly around e-fuels. Targets set out under REPowerEU set mandates for 1.2 per cent of the aviation fuel mix in 2030 to be e-SAF, rising to 35 per cent e-SAF by 2050. Estimations are that the demand for aviation fuel in the EU alone could approach 50 million tonnes by 2050, broken down into a minimum of 35 million tonnes of SAF, of which nearly 12.5 million tonnes would need to be e-SAF. For Ireland to meet this demand indigenously, work on large-scale projects to produce e-fuels needs to start now.
With Bord na Móna’s Edenderry Power Station now fuelled by 100 per cent biomass, the carbon that is emitted by the plant is classified as “biogenic”. As part of Phase III, Bord na Móna is exploring the development of a Sustainable Aviation Fuel production project at the Edenderry site, which could produce up to 150,000 tonnes of e-SAF, representing nearly 19 per cent of the estimated annual EU-mandated SAF volumes for Ireland in 2050.
Recognising the challenges
Whilst the opportunities for Ireland to play a leading role in green hydrogen production are clear, the energy industry recognises that there are challenges to overcome.
Using hydrogen for power generation and energy storage is a good concept, however, there is a question about long-term storage. Solutions range from geological storage in depleted gas fields, aquifers, or salt caverns to liquified storage at low temperatures in insulated tanks, compressed hydrogen in pressurised containers and materials-based storage where compounds such as ammonia get employed as hydrogen carriers. While these options are technically feasible, they are expensive to test and build, which creates uncertainty around financing projects.
To kick-start the hydrogen industry, we may have to acknowledge that, given the uncertainty and high costs of long-term storage, hydrogen production projects may need to leverage solutions that do not require storage such as injecting and blending the hydrogen into the existing gas network.
One obstacle to meeting 2030 and 2050 targets in Ireland is a planning process not suited to passing large-scale infrastructure plans in a streamlined, time-sensitive way. Taking the planning process into account, infrastructure projects can take 10 to 15 years to complete from inception to energisation, therefore inefficiencies in the process create a risk of pushing out timelines for meeting climate targets.
Streamlining planning processes in Ireland will be increasingly important as new concepts for energy production emerge. The delivery of e-fuels, such as SAF at scale, will require a facilitative planning approach to underpin efficient production. The process requires hydrogen and a biogenic carbon source and having these elements close to each other will be key to the commerciality of the fuel.
The National Hydrogen Strategy sets out a vision alongside actions to achieve this ambition. However, those actions need to be prioritised and delivered cohesively and collaboratively. The strategy contains interdependent objectives, requiring a detailed roadmap that stakeholders can follow which will ultimately provide certainty to the market and confidence to investors.
Funding is a key enabler to achieving the aims of the National Hydrogen Strategy objectives. In the absence of firm commitments to overcome challenges in the policy framework and a clear route to market, the industry may not materialise in time to truly contribute to our 2030 climate targets. There are currently no national funding mechanisms for the early pilot projects needed to kick-start the industry. European funding is available, but it is targeted at large-scale projects. The National Hydrogen Strategy provides an opportunity for Ireland to fund initiatives at a national level, launching projects that will demonstrate the economic hydrogen value and incentivise commercial investment.
The time is now
For Ireland to achieve its net zero targets, it needs to act now with the funding of pilot projects that will give the country essential expertise and knowledge in this nascent industry. These pilot projects will pull in other stakeholders, such as the Commission for Regulation of Utilities (CRU), to develop the safety case and regulatory framework for hydrogen in the energy sector that is currently absent.
For its part, Bord na Móna is working hard through its climate solutions and renewable energy business to develop projects to electrify sectors where possible. However, in sectors where electrification is not feasible, the case for using green hydrogen is strong. With its extensive landbank, ability to co-locate hydrogen and biogenic carbon production, and its head start with its biomass-fuelled Edenderry Power Station, Bord na Móna is perfectly positioned to be a key partner and driving force in the green hydrogen journey.
