Governments looking to achieve whatever carbon-cutting goals emerge next month from the UN Cop 26 climate conference would do well to adopt the model of California's Low Carbon Fuel Standard (LCFS), according to Air Products, the world's largest hydrogen producer.
California's LCFS is a good example of a programme that has changed behaviours by incentivising demand for low-carbon fuels such as hydrogen, Air Products' vice-president of sustainability, Simon Moore, said.
"The LCFS does not worry about the technology or how you reduce the carbon footprint," Moore said. "The lower the carbon, the better. It is that simple. So if you are making blue hydrogen or if you are making green hydrogen, the lower you make the carbon intensity, the more valuable for that programme."
Moore's view is in line with that of Hydrogen Europe's chief executive, Jorgo Chatzimarkakis, who warned Cop 26 participants against agreeing to rules that lock in certain technologies while banning hydrogen from some sectors.
Air Products aims to be the world's leading producer of blue hydrogen, with projects to be completed in Canada by 2024 and in the US by 2026. Its joint venture Neom project in Saudi Arabia, opening in 2025, would make it the top producer of green hydrogen. The US-based company's blue hydrogen projects are designed to capture 95-97pc of carbon emissions for underground sequestration, while its green hydrogen project will generate 4GW of power from on-site wind and solar installations to run electrolysers producing carbon-free hydrogen.
"We will make the hydrogen available," Moore said. "We have the technology. We have the capital and balance sheet capacity to do that."
LCFS carbon credits are helping drive the conversion of some of California's largest oil refineries towards renewable diesel production. The fuel generated more than a third of all credits in the state's LCFS programme in the first quarter of this year. Low-carbon hydrogen can further reduce the carbon intensity of renewable diesel, as the fuel consumes five times more hydrogen than that used to produce the same volume of petroleum diesel, Moore said.
The construction of fuelling stations for hydrogen fuel cell-powered electric vehicles is ramping up in California, partly because the stations generate carbon credits under the LCFS programme. The state has 47 retail hydrogen fuelling stations, with another 127 under development, according to the California Fuel Cell Partnership. The group is calling for 200 heavy-duty stations to support 70,000 trucks by 2035.
Running electric vehicles on batteries charged from the grid is probably best for passenger vehicles, but the weight of battery packs becomes too great for heavy modes of transportation. This is why low-carbon hydrogen is the best option for decarbonising buses, trucks, trains and perhaps even planes, Moore said.
Moore, who is also Air Products' vice-president of investor and corporate relations, said hydrogen is also well suited for reducing carbon from industrial processes such as steel and chemicals production.
"The world has decided it wants lower-carbon energy, and we are going to have it for the world in 2025 and 2026," Moore said.
Read more from this exclusive interview with Air Products next week in the debut issue of Argus Hydrogen and Future Fuels.
