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Currently, the cost of developing blue hydrogen is well below that of the green version across theworld, giving Alberta an early advantage, notes Peters & Co., a Calgary-based investment brokerage.
“The development of blue hydrogen in western Canada benefits from an abundant supply of natural gas, extensive fuel transmission infrastructure, geologysupportive of carbon capture and underground storage (CCS) andestablished regulations and technical expertise. It isestimated that blue hydrogen can be produced in western Canadafor as low as $10/GJ, one of the lowest costs in the world,” Peters said in a report.
While the cost advantage of blue is expected to erode in coming years, bluehydrogen has the potential to be a lower cost solution and be an attractive near or net-zero energy source.
Blue hydrogen is not a sustainable avenue and should only be a temporary solution
Jonathan Côté, Hydro-Québec spokesperson
Alberta already enjoys a global leadership position inthe production of blue hydrogen, with emissions from 40 per centof hydrogen production in the industrial heartland region currently being reinjected, Peters said.
Some analysts, however, have warned of a ‘hydrogen hype cycle’ that could result in a bubble of rising capacity that will eventually burst before the hydrogen revolution begins in full.
“(The gas) industry’s hydrogen hype machine is in full swing…. While hydrogen is presented as a climate panacea, concerted lobbying by the gas industry has ensured that for the next few crucial decades at least, Europe’s much-hyped ‘hydrogen economy’ will be powered by hydrogen made from polluting fossil fuels rather than from renewable electricity,” according to Corporate Europe Observatory, an independent research group that rejects funding from EU institutions and corporations.
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