Hydrogen Storage at Liquid Terminals Provides Challenges, Opportunities for Industry
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Hydrogen Storage at Liquid Terminals Provides Challenges, Opportunities for Industry

ILTA Energy Transition Newsletter

Hydrogen Storage at Liquid Terminals Provides Challenges, Opportunities for Industry

On March 24th, the U.N. Intergovernmental Panel on Climate Change released the final portion of their sixth assessment report which summarizes the impact, risk, and opportunities associated with addressing and mitigating climate change.[1] Following recommendations laid out in previous reports, this version also stressed the need for major economic investments and the implementation of new technologies to mitigate the impacts of climate change. One of the specific recommendations has been the adoption of low-emission hydrogen, which has wide-reaching applications for abating carbon use in sectors where electrification is either difficult or impractical, like shipping, transport, and heavy industry.[2] Accordingly, hydrogen demand is expected to grow as the energy transition continues. The International Energy Agency (IEA) projects that hydrogen demand will grow from 87 million metric tons (MT) in 2020 to 500-680 million MT in 2050,[3] and the International Renewable Energy Agency (IRENA) projects that hydrogen will account for 12% of the global energy demand by 2050.[4] Industry has taken note of these changes and has responded by increasing development of infrastructure projects to generate, store, and transport hydrogen.

The challenges of distributing hydrogen

The trade and transport of hydrogen will differ from that of many other fuels. Unlike petroleum, where large deposits are stored in a limited number of countries, hydrogen can be extracted nearly anywhere in the world, as it is produced from water, biomass, or fossil fuels. A report from IRENA estimates that only a quarter of hydrogen produced in 2050 will be globally traded, and 74% of hydrogen will be produced and consumed domestically. IRENA also estimated that over half of hydrogen that is traded internationally will travel through pipelines while 45% is projected to be transported on ships and freight.

No matter how it is transported, there will be several challenges associated with handling hydrogen that may be greater than the challenges associated with handling other fuels. Hydrogen gas has a low density, so it is generally liquified before transport. Liquifying hydrogen is energy intensive, given the need to keep storage temperatures below -250 °C, which translates to an energy penalty of 30-36% of the total energy content.[5] Liquified hydrogen (LH2) also has lower auto-ignition temperatures and wider flammability ranges than liquified natural gas, requiring rigorous safety precautions. Also, the small size of the hydrogen molecules means they can escape and leak more easily than other molecules such as methane, requiring more robust storage tanks and pipelines for safe containment.

To partially overcome several of these issues, it may be preferable to store and ship hydrogen by converting it to ammonia, given this form only needs to be stored at -33 °C, which lowers the energy cost associated with transportation and storage. This method introduces an energy penalty of around 30% of the total energy content, as excess energy is needed to crack ammonia to re-extract the hydrogen.

The future of hydrogen and terminals

Given the future demand for hydrogen and the technical challenges associated with its storage and transportation, there are important considerations the liquid terminal industry should take into consideration when evaluating its role in storing this product.

In regard to liquid hydrogen (LH2), there are conflicting views about the potential for converting current terminals, such as LNG terminals, into LH2 terminals. An LH2 tank requires 10x greater thermal resistance than LNG tanks due to the low boiling point of hydrogen. Additionally, the low energy density of LH2 requires larger tanks to store the same amount of energy as LNG. For some terminals, converting LNG tanks to LH2 tanks may be an economically sound choice but for many, it may be preferable to build new tanks to hold hydrogen.

Storing ammonia will represent a different set of challenges. Terminals will have to evaluate the economic and technical costs associated with building the ammonia cracking units needed to convert the ammonia back into hydrogen and the challenges associated with storing both presentations.

These changes mean that liquid terminals will likely look different as the hydrogen economy grows and supply increases. Depending on geographic location and customer base, ILTA members are likely to face decisions around integrating hydrogen storage into their commercial offers and the challenges associated with that process. This will include conversations around converting or building relevant infrastructure and the need to adapt to a higher variety of domestic transportation of fuels, stricter safety precautions, and new storage and handling needs.

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