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Perspectives

Deloitte collaborates with Duke Fuqua’s EDGE Center

Exploring new clean energy pathways

A strategic collaboration to bring insight and thought leadership about the energy transition: The Deloitte Research Center for Energy & Industrials is pleased to collaborate with the Center for Energy, Development and the Global Environment (EDGE) at Duke University’s Fuqua School of Business on a series of co-authored publications focused on clean energy pathways in the energy transition.

A collaboration created to explore new clean energy pathways

The future of hydrogen

To kick off our series on new clean energy pathways, we take a closer look at hydrogen’s promise, as well as some of its challenges. Together, we break down what appears to be behind the recent enthusiasm, assess some of the specific challenges that hydrogen may be able to solve, evaluate its current state in the United States and globally, and explore potential future scenarios.

There’s a great deal of current enthusiasm about the prospects for hydrogen, especially when it comes to reducing emissions across the global economy, and it’s easy to see why. Hydrogen is clean, energy-dense, and available, and it could complement other renewable energy sources. But why the surge in interest now, when hydrogen has been used in many applications for decades? And what are the very real challenges involved in integrating hydrogen into the US and global economy and infrastructure?

Hydrogen at a glance:

  • Current global hydrogen production is around 70 million tons of pure hydrogen per year, along with around 45 million tons that is mixed with other gases and used in a variety of industrial applications.1
  • Around three-quarters of the hydrogen currently produced comes from natural gas2 —a process that releases carbon emissions. In a small but increasing number of cases, the carbon is captured, and the resulting product is considered “blue hydrogen.”
  • What's new is the emerging potential for cost-competitive, low- or no-carbon blue and green hydrogen. Developments in carbon capture, as well as the falling cost of renewable power, will potentially make these option more feasible.
  • Additionally, the use of hydrogen is being explored as a form of storage to help offset the intermittency of renewable electricity sources like solar and wind.
  • For a hydrogen economy to gain momentum, hydrogen will need to compete on cost with other energy sources and will likely require rapid scaling of infrastructure. In addition, for green hydrogen to be cost competitive, production costs would potentially need to drop to below $2 per kilogram.3
  • Hydrogen supply and value chains are complex and require large upfront investment. Cross-sectoral collaboration will likely be required to ensure investment in this interconnected infrastructure moves ahead.

Podcast: Hydrogen and the decarbonization puzzle

In this episode of the Fueling the Future series, we explore the role of hydrogen as part of the energy transition. Since there is recent interest and enthusiasm about hydrogen, especially for its use to reduce emissions, we discuss the value proposition of green hydrogen. What energy challenges can green hydrogen solve? What hurdles must be overcome to capture this opportunity? What are the most exciting current global examples?

Stay tuned for future episodes about clean energy pathways.

Stay tuned about future publications in our series

Bookmark this page, follow @Deloitte4Energy on Twitter, or subscribe to My Deloitte to receive notifications from our Energy, Resources & Industrials practice, including alerts about newly released publications in this series.

About the contributors

  • Kate Hardin | Executive director of the Deloitte Research Center for Energy & Industrials
  • Dan Vermeer | Associate professor of the practice and executive director of the Center for Energy, Development and the Global Environment (EDGE) at Duke University’s Fuqua School of Business
  • Nichelle McLemore | Managing director, Oil, Gas & Chemicals, Deloitte Services LP and EDGE Advisory Board member

Endnotes

1World Nuclear Association, Hydrogen Production and Uses, April 2021.
2International Energy Agency, The Future of Hydrogen, June 2019, p. 38.
3S&P Global Market Intelligence, “Experts explain why green hydrogen costs have fallen and will keep falling,” March 5, 2021.

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