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The European Business Observatory has just published an investigative report showing that lobbyists for EU and US oil corporations have used misleading claims about hydrogen production to access billions of dollars in subsidies from governments , while helping these corporations preserve profits.
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In May 2022, oil and energy industry leaders were invited by German Education and Research Minister Bettina Stark-Watzinger to talk to bankers, investors and politicians about the lucrative green hydrogen gas. Germany's embrace of green hydrogen is a major victory for the hydrogen lobby. The latest report from the European Business Observatory shows that lobbyists have successfully helped shape Germany's stance on the subject through heavy advertising spending. The chairman of the German Industry and Energy Association (BDEW) energy lobby group said that BDEW member companies are responsible for 90% of the country's fossil gas sales.
In negotiations to complete the phase-out of internal combustion engine vehicles by 2035, Germany has refused to sign up until there is an alternative: these cars can be sold after 2035 if they run on eFuel. German eFuel comes mainly from automakers in the eFuel Alliance, who have loudly declared their goal of gaining political approval and regulatory approval for eFuel as a significant contribution to sustainable climate protection. More than 100 German companies – many of them involved in fossil and other polluting industries – have been identified as key players in the green hydrogen value chain. As governments set out policies to reduce emissions and achieve net zero carbon by 2050 as part of their climate change agenda, raising the stakes for fossil fuels, companies have turned to hydrogen as a way out of procrastinating on climate action. Hydrogen is also becoming a silver bullet for EU and German policymakers. Germany is set to become Europe’s largest hydrogen importer, with an estimated share of up to 70% of the combined EU and UK imports in the future. The EU’s REPowerEU green hydrogen plan aims to import 20 million tonnes of green hydrogen by 2030, half through domestic production and half imported. However, this is unrealistic, with less than 0.04 million tonnes of green hydrogen produced globally in 2021.
The Americans were ahead of their time when in 1977, Exxon Corporation first identified hydrogen production as the cause of catastrophic climate change in the future. But since then, Exxon has been very successful in hiding the truth from investors and governments around the world. According to two experts, Alex Grant, President of Jade Cove Partners (San Francisco, USA) and Paul Martin, a chemical process development expert (Toronto, Canada), Exxon and other fossil fuel companies have waged a multi-generational information war to sow fear and doubt about climate science and new energy technologies to increase market share for their hydrocarbon products, increase profits, and reduce costs.
Huge carbon footprint
Like the narrative used by the tobacco industry to block tobacco regulation, the hydrogen hype masks the fact that 99% of hydrogen produced globally today is “grey” hydrogen made from fossil fuels, with annual CO2 emissions exceeding the entire emissions of Germany. Green hydrogen is promoted as a low-carbon alternative. Green hydrogen is made from natural gas, extracted from gas fields and then refined by removing carbon dioxide, which must be stored back underground. This process typically accounts for 10-15% of greenhouse gas emissions, which accumulate as production increases. Both grey and green hydrogen are much more expensive to produce than conventional fuels. The report warns that this is a product of fossil gas with emissions collected through carbon capture and storage, a flawed, risky, and expensive technology.
Former UK Prime Minister Boris Johnson put hydrogen at the heart of his Net Zero PR campaign, saying the government would invest up to £500m in new production facilities, testing hydrogen for heating homes. He talked about building a hydrogen town and creating 5GW of low-carbon hydrogen by 2030. But Mr Johnson seemed to forget about the existing hydrogen industry, which produces around 115m tonnes of hydrogen each year and dumps 830m tonnes of CO2 into the atmosphere. 830m tonnes of CO2 a year, or 2% of all global greenhouse gas emissions. That’s four-fifths of the emissions from the aviation industry; more than double the emissions of the entire UK economy. With more than 99% of it being “grey hydrogen” – meaning it’s extracted from natural gas, coal or oil.
The International Energy Agency (IEA) maps hydrogen use as follows: 30% of total global hydrogen use – 38 million tonnes/year – is in refineries. Most of this is produced on-site, mainly from natural gas. Hydrogen is used in the chemical process of removing sulfur and other impurities from crude oil. Hydrogen used in refineries generates about 230 million tonnes of CO2 emissions/year – slightly more than the entire economy of Singapore, and slightly less than France. Another 27% of hydrogen is embedded in chemicals to produce ammonia; smaller amounts go into explosives, synthetic fibers and other chemical products. The next use of hydrogen, at 11% of the total, is in the production of methanol; about 3% of the world's hydrogen is used in the direct reduction of iron to make steel…
“E-fuels, which are hydrogen- and CO2-based, are highly inefficient. With an estimated energy efficiency of 16% compared to 72% in electric vehicles, they are not part of the climate solution,” the report stressed.
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