Hydrogen
The (petro)chemicals industry is both a major producer and consumer of hydrogen. Hydrogen used as chemical feedstock is produced from natural gas, which is converted into hydrogen via Steam Methane Reforming (SMR) and then directed to ammonia and methanol production. Hydrogen is currently not directly used as an energy source in the chemical industry but is commonly combusted for energy as a component of other gases such as syngas and process off-gases. In the petrochemicals industry, it also occurs as by-product in steam cracking and Propane de-hydrogenation (PDH).
However, hydrogen production via SMR is currently one of the largest CO2-emitting activities of the chemical industry. To be compatible with the EU’s long-term climate commitments, the carbon footprint of hydrogen production will have to be significantly reduced. Several technologies are under development: Carbon Capture and Storage (CCS), Methane pyrolysis, whereby methane is split into hydrogen and solid carbon or Photolysis (i.e. direct utilisation of sunlight).
EU policy
In July 2020, the European Commission adopted its EU Hydrogen Strategy addressing how to transform this potential into reality, through investments, regulation, market creation and research and innovation.
Hydrogen can power sectors that are not suitable for electrification and provide storage to balance variable renewable energy flows, but this can only be achieved with coordinated action between the public and private sector, at EU level.
Our View
In line with Cefic, Petrochemicals Europe expects hydrogen to play a pivotal role in reducing the carbon footprint of Europe’s energy and feedstock supply within the transition to climate neutrality. The future of the European chemical industry – especially in the transition towards climate neutrality – will be closely intertwined with the development of a hydrogen economy, as it is both a major producer and consumer of hydrogen. In the future, hydrogen could also become a major building block of chemical products with a low GHG footprint and could help to decarbonise the chemical industry’s energy consumption. For the vision to become reality, the European Union needs a Hydrogen Strategy, which creates legal and investment certainty, to pave the way for a successful deployment of climate-friendly hydrogen.