Nuclear seen as key part of mix for clean hydrogen
Nuclear power must be developed to expand the production of zero-carbon hydrogen due to competitive pricing, relatively small geographic footprint, and high capacity, say analysts and industry heads.
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Nuclear offers abundant electricity and process heat, both of which can be used to produce hydrogen without the emission of greenhouse gases and, depending on the size of the reactor, can be either cogeneration, providing electricity and hydrogen for the larger plants, or single purpose plants for smaller reactors.
The production of process heat also means that nuclear reactors can be paired with high-temperature steam electrolyzers (HTSE) which use less electricity per kilo of hydrogen produced. Advanced reactors operating at very high temperatures can produce hydrogen thermochemically, without the use of electrolyzers.
Nuclear power proponents argue high-priced examples - such as Hinkley Point C in Britain, the Vogtle reactors in the United States, and first-of-a-kind projects, such as some of the advanced next generation reactors under development - are outliers that suffer from poorly developed supply chains, unclear classification, and teething problems inherent with new technologies.
Such problems could be solved by maturing the new-build industry, finding ESG investable asset recognition, and moving to nth-of-a-kind advanced reactors that are cookie-cutter factory built.
Low capacities offered by renewable sources when running electrolyzers, and rising capital expenditure costs for electrolyzers and power storage, mean nuclear is relatively economical in the short term.
“The cost increase has been disproportionately larger on solar and wind generated hydrogen than it has been on nuclear hydrogen … and that means that nuclear based hydrogen can have a cost advantage in many markets, though future declines in renewable power costs and electrolyzer capex could change that,” says Associate Partner at McKinsey & Company Tom Hellstern.
In the long term, meanwhile, even as wind and solar prices drop below that of nuclear, there remains great value in keeping nuclear around, Hellstern says.
“Hydrogen can act as a dispatchable load to improve the economics of nuclear and make sure the electrons are available for the grid when the sun isn’t shining and the wind isn’t blowing.”
Cost breakdown
In Lazard’s latest annual breakdown of levelized costs of energy from generation and storage technologies, and hydrogen production methods, subsidized ‘green’ (renewables) and ‘pink’ (nuclear) hydrogen can reach levelized production costs of under $2/kilo.
Running a 20-100 MW polymer electrolyte membrane (PEM) electrolyzer, subsidized nuclear-produced hydrogen will cost between $1.16 to $2.99 per kilo, while subsidized renewables produce hydrogen for between $4.77 to $.7.37 per kilo, Lazard found.
Comparatively, nuclear performed equally well for alkaline electrolysers and for unsubsidized generation.
The flexibility of nuclear, which often runs at a constant above 90% capacity factor, is also important when providing power for electrolyzers and consumers, Hellstern says.
“When power prices are cheap, you make hydrogen. But, when power prices are expensive, and the grid really needs those decarbonized electrons, you just turn off your electrolyzer and then you sell power. That’s how the nuclear players are viewing hydrogen as a long-term play to increase the monetary value of their baseload clean electrons,” he says.
Nuclear generated electricity is especially competitive when it is produced from nuclear plants which have had their operating lives extended, according to the International Energy Agency (IEA).
“Electricity produced from nuclear long-term operation (LTO) by lifetime extension is highly competitive and remains not only the least cost option for low-carbon generation - when compared to building new power plants - but for all power generation across the board,” the IEA says.
Generation footprint
Nuclear power is the most land-efficient source of electricity production and needs 27 times less land per unit of energy than coal and 34 times less than solar PV, according to the World Economic Forum.
Today, only 2% of the world’s hydrogen is produced from low-carbon sources of power generation while green hydrogen strategies from dozens of countries are calling for all hydrogen to be from low-carbon sources.
The same strategies are calling for hydrogen use to be extended beyond its current application in chemicals, industrial processes, and fertilizer production, to a wide suite of applications including fuel in transport and as an energy storage device for intermittent renewables.
Clean hydrogen production needs to rise to 614 million tons (MT) a year by 2050 from 0.8 MT a year currently, according to the International Renewable Energy Agency (IRENA).
Electrolyzer capacity today is around 0.5 GW worldwide and is expected to reach between 134-240 GW by 2030, while the Net Zero Emissions by 2050 Scenario requires expanding electrolysis capacity to above 700 GW by 2030, according to the IEA.
This enormous ramp up of electricity generation does not include the additional goal of reaching a 50% share of direct electricity in final energy consumption from 21% today.
If hydrogen production and increased electrification, expected as part of the world’s plans to reduce CO2 emissions, is to come from pure renewable sources, the land use alone will be staggering.
Land use implications of the additional 18GW
of PV required to replace Diablo Canyon
Source: TerraPraxis' "Innovation for Climate: Energy Innovation for a Properous Plant"
Diablo Canyon Nuclear Power plant in California has an installed capacity of 2.2 GWe with the plant and surrounding administrative and storage buildings covering an area of just over 900-acres.
The footprint of a solar power project producing the equivalent amount of electricity, which would need 18 GW of PV and 11 GW (100 GWh) of storage capacity, would be around 90,000 acres (around 364 km2), costing an estimated $23 billion, according to TerraPraxis.
“There is this idea that solar is cheap, but when you look at the energy that's produced, and then land requirements and the scale of the installation that would be needed to match the footprint and compare to the production of a nuclear plant, you very quickly realize that it starts to get pretty expensive,” says Founding Director and Co-CEO of TerraPraxis Kirsty Gogan.
By Paul Day