Background to the Study

The primary objective of this study is to conduct a techno-economic and environmental assessment of the production of natural gas-based hydrogen with accompanying carbon capture and storage (CCS) technology. Further, the purpose of this study is to enrich knowledge and compare the deployment of steam methane reforming (SMR), electrified SMR (E-SMR), autothermal reforming (ATR), and partial oxidation (POX) with CCS in the Netherlands. The findings of this study will be of interest to policy makers, industrial emitters, as well as technology developers.

Key messages

·      The life cycle assessment (LCA) for the natural gas-based blue (CCS-abated) hydrogen production technologies reveals that a reduction of the carbon footprint ranging between 43-76% can be achieved in the Netherlands in 2020 for all the investigated technologies. This reduction is set against the reference grey (without CCS) hydrogen with a carbon footprint of 10.13 kg CO₂ eq./kg H₂.

·        The carbon footprints of blue hydrogen produced using SMR (2.78 kg CO₂ eq./kg H₂), ATR + GHR (3.23 kg CO₂ eq./kg H₂) are comparable to that of POX, with POX (2.43 kg CO₂eq./kg H₂) achieving the lowest carbon footprint. In contrast, blue hydrogen produced using ESMR has the highest carbon footprint (5.74 kg CO₂ eq./kg H₂). This is primarily because of the significant utilisation of the carbon intensity of electricity in the Netherlands (480 gCO₂/kWh in 2020).

·        Direct CO₂ emissions (reaction emissions and emissions related to combustion of natural gas), natural gas production and transport as well as grid electricity, were found to be important contributory factors in the carbon footprint of the blue hydrogen production pathways. The most influential factor on the carbon footprint of hydrogen produced via SMR + CCS was the natural gas production and transport. The largest contributing factor of the carbon footprint for ATR + gas heated reformer (GHR) + CCS, ESMR + CCS and POX, in this study, was the source of electricity utilised to run these thermochemical processes.

·        The carbon capture rate has a significant impact on the carbon footprint of the blue hydrogen production technology. The overall carbon footprint of hydrogen produced with the SMR technology is reduced by 8% when the carbon capture efficiency is increased from 90% to 99%, this is despite the increase of electricity usage increase by 10%.

·        An increase of the carbon footprint of natural gas by 171% and 29% were observed for natural gas imported to the Netherlands from Russia and Algeria respectively. 

·        The projected reduction in carbon footprint for different technologies varied significantly from 12% for SMR + CCS to 54% for ESMR + CCS by 2030.

·        All the four investigated technologies were observed to be most sensitive to feedstock/fuel costs and the price of CO₂ T&S. SMR was also found to be highly sensitive to increasing carbon prices because this technology exhibits the lowest CO₂ capture efficiency amongst the studied technologies. In contrast, ATR, POX and ESMR are observed to be largely sensitive to electricity costs.

·        POX is the most cost-effective process for avoiding CO₂ emissions, whereas ESMR is the highest cost in Netherlands in 2020. SMR and ATR both have a cost of CO₂ abatement of about €110/tCO₂, which is about 28% higher than POX and between 9% to 25% lower than ESMR (with grid and renewable electricity respectively).

·       By 2050, the investigated blue hydrogen production technologies have between 17% to 31% lower LCOH against the reference case. In this case scenario, significant reduction of the cost of CO₂ T&S for all technologies is realised as CCS projects are de-risked. Significant learnings are gained from numerous deployment projects and economies of scale are achieved.

This report is available to download.