Monday, November 29, 2004

Another Wrinkle on Hydrogen
Most of the planning for a future hydrogen economy revolves around the replacement of oil-based transportation fuels with hydrogen generated by cleaner energy sources. This would then be consumed in fuel cells--either vehicular or stationary--thus providing further efficiency gains due to the higher energy recovery of these devices compared to internal combustion engines. But a new development in hydrogen production, utilizing high-temperature nuclear reactors and ceramic separation technology, might provide a way to use hydrogen to leverage existing natural gas supplies.

Large quantities of hydrogen are already produced from natural gas within oil refineries and chemical plants. This hydrogen never appears in the market, because it is consumed in the production of reformulated gasoline, low-sulfur diesel, or ammonia-based fertilizer. The total quantity of natural gas involved is roughly a billion cubic feet per day in the US alone, or about 1.5% of our total consumption.

Hydrogen generated by a few centrally-located nuclear reactors in Texas, Louisiana and New Jersey, could supply a large portion of the demand for "process hydrogen" and free up a commensurate amount of natural gas for use in homes or in power generation, backing out dirtier fuels. This strategy would only work for hydrogen produced from an emissions-free source, such as nuclear, because of the large energy losses involved in making the hydrogen.

The advantages of such an approach would include the creation of a large hydrogen supply base prior to the introduction of hydrogen-fueled cars, thus helping to break some of the chicken-and-egg dependency of a hydrogen-based transportation system. It could also help to mitigate the growing gap between natural gas supplies and potential demand.

Ultimately, the feasibility of this scheme would hinge on whether it would be easier to build high-temperature nuclear reactors for hydrogen production, or to overcome the obstacles to creating a network of LNG receiving terminals, as well as on the relative economics involved.

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