Considerations for the Hydrogen Economy’s Midstream Needs

As the hydrogen economy races ahead, with substantial national and local incentives in place for developing both upstream and downstream technologies, there is a growing awareness of the need to develop the storage and distribution, or “midstream”, infrastructure required by the industry. California has reacted to this need by announcing that it will be creating and implementing a California Hydrogen Market Development Strategy, using an all-of-government approach to build out the hydrogen market. Complemented by the recent creation of California’s “infrastructure strike team”, this initiative includes provisions that help develop hydrogen storage and distribution that can support the growth in production and demand.

Today, there is an estimated 5,000 km of existing hydrogen pipelines globally, mostly restricted to use by large hydrogen producers that directly supply hydrogen to industrial consumers. However, increased global demand is likely to result in a more diverse group of hydrogen suppliers and customers. Adapting to this change will require substantial investments and an understanding of the different technologies and methods involved in hydrogen management. The figures below show the broad array of methods available for hydrogen storage and distribution and their components. Each of these methods has a particular set of challenges and benefits that make them useful for certain parts of the hydrogen supply chain. Understanding these unique characteristics and how they can play into each terminal operators’ individual business is key to ensuring the industry is prepared to play its role in the energy transition.

Importantly, Figure 1 highlights storing hydrogen as a compressed gas and as a cryogenic liquid is currently the most common method. However, it is worth noting that there are already important investments in developing facilities that use alternative methods, including chemical processes such as ammonia and methanol, to enable hydrogen storage. Similarly, Figure 2 also notes that transporting hydrogen as compressed gas or as a cryogenic liquid is the current industry practice, alongside transportation through new pipelines built exclusively for H₂ distribution. Chemical methods of hydrogen distribution including ammonia, LOHC and methanol are identified as distribution methods that could potentially leverage existing chemical and petrochemical infrastructure to be developed. Using existing natural gas pipelines by blending in a determined amount of hydrogen or retrofitting these pipelines to transport hydrogen exclusively are also listed as potential solutions, but these require extensive studies and safety tests.

Already immersed in producing hydrogen, there are several companies taking significant steps to develop both storage and distribution capabilities and better understand the opportunities that lie before them. Chevron and Cummins recently announced a memorandum of understanding (MOU) to, “leverage complementary positioning in hydrogen, natural gas, and other lower carbon fuel value chains.” In doing so, the companies hope to enable, “the commercial development at scale of alternative fuels production, transportation and delivery systems for industrial and commercial markets, with target consumption by transportation vehicles.” In that enablement lies the opportunity for ILTA members to expand their business in a way that is viable in the long-term energy transition.

Figure 1: Hydrogen Storage Methods (attached below)

Figure 2: Hydrogen Distribution Methods (attached below)