ClimateEnergyEnvironmentIndustry

When hydrogen partners with electrons: clean heating for all

We want everyone in Europe to have a home they can light, heat, or cool without breaking the bank or breaking the planet,” said Frans Timmermans when presenting the Renovation Wave in October 20201.

As CEO of a 104 year old company in climate solutions, I am convinced that this dream is feasible. We can make it. And we will – with a mix of decarbonised electricity and decarbonised heating fuels, including hydrogen.

Electrons and molecules together are the winning tandem. Success depends on our ability to get both people on board and to optimize the whole energy system; a narrow focus on sectors or heating technologies in isolation is a cul-de-sac.

 The benefit of hydrogen in heating is threefold: 1) optimized use of gas net- works and storages for demand peaks in winter;  2) optimized electricity demand and “dimensioning” of dispatchable generation and infrastructure capacities;  3) optimized and flexible investment pathways for individualized building decarbonization.

 Every 5 mln heat pumps add roughly some 15 GW peak load to be provided reliably by the electricity system in winter – in addition to the growing fleet of e-vehicles.

 The price tag for energy system decarbonization is significantly lower with hydrogen in heating: for Germany alone, including hydrogen for heating in buildings lowers the system cost by 11 bln EUR2 each year, until 2050.

 The individual needs of 450 mln citizens and the heterogeneity of buildings across the EU make emissions of buildings hard to abate. The heating sector is ready to process hydrogen admixtures up to 10% right away, and new appliances can process up to 20%.

Blending in the early phase of the ramp up of the hydrogen economy provides a stable demand and scale, hence security for investments.

Making new heating equipment hydrogen-ready for later changes in the gas mix is feasible. It is a no-regret.

Emissions of buildings are hard to abate. 450 mln EU citizens have to buy in. Think about it: the building stock is highly diverse, so are individual needs, preferences and financing capabilities – from Helsinki to Athens. 40% of the building stock was built over 60 years ago. Deep renovations, that reduce energy consumption by at least 60%, are carried out only in 0.2% of buildings per year and only 4% of heating systems are replaced per year. The current energy renovation rate of buildings, incl. investments in the envelope and equipment, leads on average to a reduction of the energy consumption of the building stock by only 1% per year. In many regions qualified professionals are scarce.

It is clear. We need to do more, we need the buy-in of people, we need speed and we need a long-term systemic view.

Hydrogen-readiness is a no-regret. In Europe, 64% of heating installations are old and inefficient3 . If they had an energy label, it would indicate class C, D or lower. At the same time almost 7% of Europeans cannot afford to sufficiently heat their homes. High upfront cost for renewables based heating systems, split-incentives, and lack of long-term planning are amongst the reasons for slow heat generator replacement rates. Today, the urgency for modernising the installed stock of heating systems coincides with innovative technologies already on the market or in the making.

The equipment is ready. Each boiler, small-scale combined heat & power installation and heat pump/boiler hybrid will be capable of running on methane, or methane-hydrogen blend, or pure hydrogen. “Hydrogen ready” boilers are an affordable future-proof retrofit solution: initially they process methane or methane-hydrogen blends. If the gas supplier switches to pure hydrogen, they can be adapted with minor changes on-site. A no-regret for customers, without lock-in effects for fossil fuels. A priority is to make sure that the Green Deal synchronizes the replacing of fossil gas with the market uptake of future-ready equipment. Our sector supports ecodesign rules requiring all new heaters being hydrogen-ready, with an appropriate transition period that allows makers to convert their portfolios in time.

Hydrogen opens new options for people, on the road to climate neutral buildings. The trajectory is known: By 2030 we reduce emissions in buildings by 60% compared to 1990 levels and by 2050 we reach climate neutrality. The building sector is vastly heterogeneous, a one-size fits all approach is neither efficient nor realistic.

To get on track, we need a toolbox of measures targeting:

i) acceleration of renovation, in envelope and equipment;

ii) electrification of heating with heat pumps;

iii) greening of heating fuels incl. hydrogen. Hydrogen is an enabler of electrification, because it is a seasonal storage for renewable electricity, complementing biomethane with regionally varying potential.

Looking at Germany, about 90% of installed heating systems are based on gas or oil. For a part of it – for example a single family house built for 30 years or more recently – heat pumps can often be installed right away. For another part – e.g. old buildings or multifamily houses with individual gas heating – decarbonization is more difficult. Options include “deep renovation”, or a switch to a decarbonized heating fuel, or a staged renovation approach combining decarbonized fuels with gradual investments into the envelope. Leaving nobody behind, without risking citizens’ support for the energy transition means: we need all of these options.

Hydrogen in buildings contributes to system efficiency and energy security. Energy demand for heating shows high seasonal variations. Peak demands in winter often coincide with low electricity generation from renewables. In central Europe, the monthly average load in the coldest month in the gas sector is about a factor of 3 of the load in the warmest month. For the electricity load, this factor currently is only 1.2. The more electricity we use for heating, the more grid reinforcement, installed capacities and dispatchable back-up plants we need to deliver enough electricity at any time and ensure resource adequacy – that is secure electricity supply also when demand is high, and production of renewable electricity is low; also after the coal exit.

Studies with an energy system perspective4 conclude that a mix of heat pumps and combustion heating with decarbonized gases is more cost-effective than “electricity only”. The energy system cost-savings stemming from well-dosed volumes of decarbonized combustion outweigh the superior “factor six” efficiency of heat pumps taken “in isolation ” – calculated over the heating season, and considering processes for producing and transporting hydrogen.

In EU-275 in 2018 about 20% of electricity production was from coal, and 25% from nuclear, often built decades ago. This fleet is currently often delivering the bulk of electricity supply, especially during winter days without wind and sun. Germany, for example, has to compensate for about 36 GW of installed “conventional” generation capacity due to the coal and nuclear phase out. On the other hand, every five million heat pumps will – with conservative assumptions – increase peak demand by about 12 to 25 GW, in addition to the demand from the growing fleet of e-vehicles – with every ten million vehicles estimated to add about 5 GW6 .

The numbers speak for themselves: Decarbonised gases delivered via existing refurbished gas infrastructures support energy system reliability and resilience, with optimized costs.

Hydrogen in buildings, via blending, can also facilitate the ramp up of the hydrogen economy in its early phase. The current natural gas infrastructure and space heating stock can already safely process up to 10 volume percent of hydrogen admixture. If needed, the heating sector provides a stable demand for decarbonized hydrogen – and hence security for ramping up investments into the hydrogen value chain, speeding up the learning curve to the benefit of all sectors.

This is how electrons and hydrogen can reinforce each other on the road to decarbonization. This is how we ensure that everyone in Europe has “a home they can light, heat, or cool without breaking the bank or breaking the planet”. With a strong commitment and fast deployment of readily available heating technologies, we can ensure that the energy transition generates benefits to people, the environment, and our economy.

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1 Frans Timmermans, Executive Vice-President for the European Green Deal

2 German Energy Agency, www.dena.de/en/ integrated-energy-transition

4 E.g. dena Leitstudie Integrierte Energiewende; Gas for climate study by Navigant

5 EU energy in figures, https://ec.europa.eu/energy/ data-analysis/energy-statistical-pocketbook_en

6 Assuming that 5% of the fleet are charging with 11 kW