Alberta is preparing for a lower emission future. The Hydrogen Roadmap is a key part of that future and Alberta's Recovery Plan. The roadmap is our path to building a provincial hydrogen economy and accessing global markets. It contains several policy actions that will be introduced in the coming months and years, and it provides support to the sector as technology and markets develop.
Alberta is already the largest hydrogen producer in Canada. We have all the resources, expertise, and technology needed to quickly become a global supplier of clean, low-cost hydrogen. With a worldwide market estimated to be worth over $2.5 trillion a year by 2050, hydrogen can be the next great energy export that fuels jobs, investment and economic opportunity across our province.
There are 5 important markets for the growth of clean hydrogen in Alberta.
Residential and commercial heating
Hydrogen use in heating includes appliances such as furnaces, boilers, water heaters, gas fireplaces, stoves, and laundry dryers.
Hydrogen can be blended with natural gas or burned directly to heat homes and businesses. This blending is an opportunity to decarbonize the natural gas distribution grid while slowly transitioning to higher blends of hydrogen.
Transportation uses include hydrogen fuel cell cars, buses, trucks, trains and aviation equipment, and hydrogen co-combustion engines primarily for heavy-duty applications.
Fuel cell electric vehicles (FCEVs) for passenger and freight transport are an emerging market that currently represent a small fraction of global vehicle fleets compared to internal combustion engine vehicles and battery electric vehicles. However, FCEV potential is promising and the number of transportation applications is growing.
Industrial uses for hydrogen include fossil fuel refining and bitumen upgrading, ammonia and fertilizers, chemicals, and liquid synthetic fuels.
About 55% of Alberta’s current hydrogen production is used for heavy oil upgrading, 38% is used for the chemical sector and chemical industry by-products, and 7% for oil refining.
The greatest opportunity in the industrial sector is converting existing high carbon intensity sources of hydrogen to clean hydrogen sources.
Power generation and energy storage
Power generation and energy storage includes generating electricity using hydrogen turbines and fuel cell generators and producing hydrogen via electrolysis from intermittent renewables as an energy storage medium.
While hydrogen does not currently play a large role in the commercial power sector, hydrogen-fired gas turbines, combined-cycle gas turbines, and electricity using fuel cells could play a future role to reduce emissions in the sector.
As the renewable power generation market grows, surplus renewable energy can be converted to hydrogen for energy storage to address challenges with renewable energy variability and uncertainty.
The export market considers Alberta’s future energy competitiveness while meeting growing international demand in North American, Asia Pacific, and European markets.
Alberta has the energy resources to produce significant volumes of clean, cost competitive hydrogen for global markets. Investors have shown significant interest in producing clean hydrogen in Alberta for export markets.
The roadmap outlines how we will support the growth of clean hydrogen across target industries using these 7 policy pillars:
Build new market demand
Alberta’s current hydrogen economy is a balanced system where production meets demand for existing industrial processes. Establishing new demand, outside of its traditional use as an industrial feedstock, will be critical to move into new markets.
Policy actions need to support emerging hydrogen markets, initially focusing on markets that provide opportunities to immediately deploy hydrogen into the provincial economy.
Clean hydrogen is an emerging opportunity with challenging economics compared to conventional, higher-emission fuel sources. Long-term investment certainty and funding are needed to ensure investments can happen today to position Alberta for the long-term.
Alberta’s support to de-risk investment is focused on working in partnership with industry and other governments to enable new clean hydrogen production, improve access to capital, de-risk hydrogen use in transportation, and consider establishing a hydrogen trading hub.
Ensure regulatory efficiency, codes and standards
Public safety must be prioritized by creating hydrogen codes and standards and regulatory requirements. A performance-based regulatory framework will allow hydrogen markets to move forward while reducing risk.
Alignment of codes, standards, and regulatory harmonization with other jurisdictions is needed to ensure Alberta’s competitiveness across the hydrogen economy.
Pursue hydrogen exports
Alberta has several advantages to supply global demand for clean hydrogen. However, Alberta needs to overcome operational constraints for export, such as an unavailable global supply chain, which includes infrastructure, transportation, liquefaction, and storage.
Alberta will need to have an established export supply chain in place, in place to benefit from the international export opportunity.
Enable carbon capture, utilization and storage (CCUS)
In order for Alberta to realize a clean hydrogen economy, CCUS needs to be in place to facilitate cost-effective, large-scale production.
Although initial CCUS infrastructure is currently in place, the Government of Alberta is considering competitiveness and CCUS accessibility to various industries across the province.
Activate technology and innovation
Demonstration projects, research, and innovation are needed to prove and scale up emerging clean hydrogen technologies.
Training and development with Alberta’s world-class universities and technical schools are important for the labour force to support the clean hydrogen economy.
Lead the way and build alliances
Public-private partnerships and government-to-government relationships, including with Indigenous governments, are essential to advance the hydrogen economy, send coordinated signals to investors, and build public awareness and understanding.
An emerging narrative against natural gas-based hydrogen production can disrupt Alberta’s efforts to build a clean hydrogen economy. As Canadian and global carbon intensity benchmarks and Guarantee of Origin schemes are proposed and developed, Alberta needs to actively inform their development with data grounded in robust analysis and science.
- Alberta on the path to a bright hydrogen future (November 5, 2021)