The 2023 Canadian Hydrogen Convention (CHC) took place in Edmonton, Alberta, and brought together industry leaders, stakeholders, and government officials from across Canada and around the world. Successful pilots and rollouts demonstrated that hydrogen is ready for more domestic use. Two-thirds of Canada’s hydrogen is produced in Canada and is expected to grow with ATCO-Suncor’s Clean Hydrogen Production Facility or the Air Product’s hydrogen energy complex being developed in Alberta.
Earlier in the year the Alberta Utilities Commission (AUC) was asked to conduct an inquiry into the future of hydrogen blending in Alberta and their findings have been submitted to the government, including potential impacts on consumers and further areas that need work and clarification. Hydrogen blending is a recent development that has been brought up in various provinces and worldwide.
What is Hydrogen Blending?
Hydrogen blending is the integration of concentrations of hydrogen into existing natural gas pipelines. Nearly all gas appliances in circulation today can run on a mixture of hydrogen and natural gas – this is called a blend. It is the process of adding hydrogen to natural gas transmission and distribution systems.
By blending hydrogen with natural gas, it is possible to reduce the carbon intensity of delivered fuel and help with using more green energy. It can also be a boon for the economy, with hydrogen use growing as a green energy source.
How does it work?
When used as a fuel source, hydrogen emits only water vapour when combusted. The AUC inquiry was focused on hydrogen blending at 20% by volume in natural gas distribution systems, such as for residential and commercial utility purposes.
Mixed fuel is being used in existing appliances such as boilers, gas furnaces, stoves, laundry dryers, and water heaters. In the coming months, they’ll work with stakeholders to continue developing a hydrogen blending framework that provides a cost-effective system for Albertans. Protecting consumers by working with different organizations responsibly in regulating the various parts of a hydrogen blending market and ensuring that everyone has the proper information about hydrogen and natural gas blending.
Hydrogen Blending in Alberta
Alberta’s Hydrogen Roadmap identifies hydrogen blending at 15-20% by volume into the natural gas distribution network as an early (and important) market for hydrogen ambitions.
The Fort Saskatchewan Hydrogen Blending Project is a first-of-its-kind project for Alberta. ATCO began to deliver a blend of natural gas containing 5% hydrogen by volume into a subsection of the Fort Saskatchewan natural gas distribution system in October 2022. Around 2,100 customers became the first in the province to use hydrogen-blended natural gas to reliably and safely fuel their homes and businesses.
Since hydrogen only emits water, the project will reduce the greenhouse gas intensity of the associated natural gas stream. In advanced economies around the world, hydrogen blending is becoming popular – including Australia where ATCO’s Jandakot Operations Center in Perth has begun blending hydrogen into the gas distribution networks. For Fort Saskatchewan, the project will ultimately be produced onsite at their Gate 5 facility using a piece of equipment known as an electrolyzer. There will be no impact to the surrounding environment or wildlife and the work is on track to be completed in 2023.
It is intended to be a stepping stone into the Canadian hydrogen market and allow ATCO to demonstrate its abilities in the sector while working through regulatory, commercial, public engagement, and technical. Including public engagement requirements. The project will act as a critical building block for Alberta’s energy future (and the rest of Canada), bringing with it many benefits to customers, users, and the provincial economy without customers needing to pay an exorbitant amount of money, plus helping to reduce the carbon footprint and work towards green, cleaner energy now and in the future.
The Alberta Hydrogen Inquiry Report from June 2022 published by the AUC (Alberta Utilities Commission) is also worth reading and immersing yourself in, to better understand the utilities and hydrogen blending purposes. The key points taken from this are as follows:
- The Commission first reviews proposed amendments to relevant legislation. Amending the definition of “gas” in the Gas Utilities Act to reference “up to 20% hydrogen by volume blended within a low-pressure natural gas distribution system” and including this definition in the Gas Distribution Act by reference.
- The Commission finds that any significant changes to existing franchise rights should be avoided until the implications of hydrogen blending are better understood. An amendment to the Gas Distribution Act could be considered to clarify that the inclusion of the definition of “gas” does not expand the exclusive rights and duties of existing franchise area approval holders. It is also premature to determine whether gas distributors should have exclusive rights to pure hydrogen systems.
- Explores the responsibilities of agencies involved in aspects of hydrogen regulation in Alberta. The current allocation of responsibilities between relevant Alberta agencies is capable of accommodating hydrogen development and its integration into the low-pressure distribution system.
- The Commission then considers safety issues. For hydrogen blending to be successful, public safety and reliability are paramount, including relevant safety and reliability standards. Government-funded and delivered education initiatives targeting safety and other positive attributes of hydrogen use could be considered to promote public acceptance and ensure that a well-informed public perception of hydrogen exists.
- The Commission considers it important to harmonize and clarify hydrogen regulations with federal and provincial governments to support the development of national and provincial codes and standards.
- The Commission is of the view that a maximum blending threshold of 20% by volume, with no minimum threshold, is reasonable, but pilot projects should start at lower levels.
- The Commission then reviews the delivery of services to rural natural gas consumers. Blending hydrogen with natural gas for rural distribution systems would be more challenging and less practical. The Commission is of the view that the focus, at least initially, should be on hydrogen integration within larger municipal systems.
- As hydrogen blending is new to the province, consideration should be given to leveraging the experience of other jurisdictions. With a clear focus on safety and reliability, it may be reasonable to move forward with targeted pilot projects to better ascertain the impact of hydrogen blending, emissions reductions, carbon intensity of various hydrogen options and resulting carbon offset, and cost information.
Alberta has the most information about hydrogen blending, as it is the province with the most resources and companies to do so, and is going ahead with it and testing projects. It is the place for low-carbon hydrogen production. Having an abundant and inexpensive supply of natural gas, unique geology, innovative technology, and infrastructure that is robust for carbon capture makes it ideal.
The Edmonton Region Hydrogen Hub – Canada’s largest and first – with developments in hydrogen hotspots like Calgary and in southeast Alberta, already under consideration or underway with projects themselves already. Hydrogen hubs accelerate the development of regional hydrogen economies, which helps not only businesses and companies – but the consumer and customers all around the province.
Providing a blueprint for national hydrogen frameworks and encourages collaboration among partners that will all benefit from sufficient levels of hydrogen supply and demand as time goes on. There are also incentive programs that will provide capital investment grants for hydrogen production projects and agencies have already provided over $92 million into funding for hydrogen projects as well. Investment into clean-tech development will continue and it will make the way easier for other provinces to follow suit.
In Other Provinces
Besides Alberta – British Columbia and Saskatchewan can produce hydrogen at half the wholesale cost of diesel and have the country’s largest carbon capture storage resources. At the end of 2020, the Canadian government published Hydrogen Strategy for Canada: Seizing the Opportunities for Hydrogen. In it, it said, “If Canada fully seizes the opportunity presented by hydrogen, it could lead to more than 350,000 sector jobs and direct revenues of over $50 billion per year by 2050.”
- Two production facilities are in place for production in Manitoba, though information about them thus far into the year isn’t quite available yet.
- The 2030 Québec Green Hydrogen and Bioenergy Strategy has the goal of creating suitable governance and favourable conditions for the development of the hydrogen and bioenergy sectors.
- The B.C. Hydrogen Strategy is their plan to become a leading hydrogen economy. The strategy outlines the government’s actions to accelerate the development of B.C.’s hydrogen sector. It will help them reduce fossil fuel use and contribute to a better/lower carbon footprint.
Hydrogen will be necessary for B.C. to achieve net-zero by 2050. Hydrogen will play a key role in reducing emissions across a wide range of sectors in B.C., including:
- Medium and heavy-duty transportation
- Industry and refining
- Displacing natural gas
- Displacing diesel used for electricity generation in remote communities
B.C. has several advantages for producing low-carbon hydrogen. More than 98% of electricity generated in the province is clean or renewable. This means B.C. has a significant opportunity to produce clean hydrogen from electrolysis.
B.C. is also home to abundant natural gas reserves and significant geological carbon storage capacity. These are necessary for producing low-carbon hydrogen from natural gas. With these attributes, B.C. can supply the growing global demand for low-carbon hydrogen.
Hydrogen Strategy Working Group: Ontario established the Hydrogen Strategy Working Group that met nine times from February to June in 2021 and was made up of 23 industry and academic experts who provided advice on how to use hydrogen across various sectors and help Ontario compete in the global hydrogen market.
Ontario’s low-carbon hydrogen strategy sets out a vision for a low-carbon hydrogen economy in the province – one where we can leverage our many strengths to develop a self-sustaining sector in Ontario, evolve our energy system, create local jobs and attract investment while reducing greenhouse gas (GHG) emissions.
Hydrogen and hydrogen blending is inevitably moving forward within Canada and only time and numbers will tell what this means for customers directly, commercial businesses, energy companies, and green/clean energy factors and facilities.
