How much water does Green Hydrogen need? - Issue #26
The Big Picture
As feared, the dawning reality of climate change is resulting in genocidal chatter.
One instance surfaced on Sunday when author Benjamin Ramm said he attended a meeting where it seemed “segments of the elite have simply ‘written off’ large parts of the Global South”.
It’s tempting to dismiss such messages as crackpot theories, but we shouldn’t. Faced with a global threat, humankind might not respond unitedly. As we saw with Covid-19, developed countries hoarded more vaccines than they needed; refused to waive patent waivers; even countries like India reneged on commitments to supply vaccines to other developing countries.
Climate change, too, as historian Timothy Snyder wrote in 2015, “might induce panic about future shortages” and force leaders of developed countries to act preemptively. Perhaps even, as he wrote, specifying a human group, like the third world, as the source of an (ecological) problem.
As history tells us, moral arguments don’t always win. For this reason, even as the global south seeks climate finance, it needs to take steps on adaptation and mitigation. Last week saw one such response. Twenty countries most vulnerable to climate change are considering halting their repayment of $685 billion in collective debt – and directing that money into boosting climate resilience.
India might well need to consider joining this bandwagon. Right now, our demands for climate finance co-exist with decidedly contradictory domestic policies. It’s an interesting juxtaposition. See Climate Reads below for more.
News of the Week
With that prologue, what made the news this week?
On the environmental front, there are two shattering reports about biodiversity loss.
The World Wildlife Fund’s Living Planet Index, which monitors 32,000 separate populations of species worldwide, found that, on average, they were 69% smaller than they had been in 1970. Also came news of a puzzling collapse in snow crab numbers. As many as seven billion crabs (total estimated population: eight billion) have disappeared – a 90% drop in numbers – since 2018 alone. Warming seas are one reason. Overfishing is another.
Given those numbers as background, how is mankind’s battle to save the planet faring?
We are inching along. This year, global Capex (capital expenditure; on setting up plants) in wind and energy will overtake Capex in upstream oil and gas. Similar trends can be seen in India, too – more on that soon. In other news. OPEC decided to cut production by two million barrels. Oil prices will likely stay high.
But even if prices do not spike in the winter due to the cuts, it is unlikely that it is because of good news. The only palpable reason for the suppression of oil prices is a severe dent in demand, indicating a protracted recession in the global economy. The worst-case scenario would see oil prices spiking even as demand struggles to stay afloat. As things stand, parts of the world are already reporting diesel shortages.
The race between China and US over semiconductors is heating up. The US is now turning to “technological containment”, reported Bloomberg. “President Joe Biden’s administration will use an obscure but potent regulation, the Commerce Department’s Foreign Direct Product Rule, to prohibit firms from providing certain advanced semiconductors to Chinese companies unless they secure permission from Washington. The administration will also block the acquisition of sophisticated US-manufactured chipmaking tools by leading Chinese firms and slap additional restrictions on dozens of Chinese companies.”
What does this mean? As Bloomberg reported: “Chinese firms were using nearly unrestricted access to advanced chips and manufacturing equipment made abroad to support Beijing’s military buildup and surveillance state. So, the Biden administration concluded that preserving US advantages required constricting that access now.”
The country’s export restrictions also prohibit ‘US persons’ from “supporting the ‘development or production’ of chips at targeted Chinese firms without a license. This is another extraordinary measure. See this thread.
The race to dominate the industries of the future is real. How is India faring in this battle? On the one hand, there are narratives about whether the country can lure supply chains to India.
But that is just half the story. See Tim Sahay’s essay in Climate Reads below.
Back home in India, this newsletter reported last week that India’s state oil cos have posted losses for two consecutive quarters now – even as global oil prices have climbed, they have not hiked their prices for seven months now. This week came news that the government is releasing Rs 22,000 crore to help BPCL, HPCL and IOC cover losses incurred by selling LPG below cost the last two years.
Continuing with hydrocarbons, Russia’s invasion of Ukraine has resulted in India looking around for other LPG suppliers. The country has begun talks with Algeria and Angola. It has also rekindled talks with US’ Tellurian. This deal was in the news till last year when then-petroleum minister Dharmendra Pradhan wanted Petronet LNG to sign the MoU – but the Petronet board had refused.
Finally, we have some estimates on how much water is needed to produce green hydrogen.
“The International Energy Agency, the Australian government’s National Hydrogen Roadmap, Goldman Sachs and others state that it takes nine to 10 litres of water to create one kg of hydrogen,” Reuters reported last week. “That only accounts for the final stage when the water’s two elements are split, known as the stoichiometric process. Getting to that point requires a larger amount of water. Yet more is needed to keep the electrolyser cool.
All in, Bluefield reckons that could take the total to 24 litres. Engineering consulting firm GHD puts it between 60 litres and 95 litres per kg for freshwater. Yarra Valley Water, a Melbourne utility that unveiled a green hydrogen pilot programme last month, pegs the upper end for the industry as a whole at some 80 litres.”
This is another reason why India might be better off exporting electrolysers – not hydrogen.
Climate Reads
India is not the only country where demands for climate finance rub shoulders and coexist with wider ecocidal decisions. There is Egypt too. The country is clamping down on activists working on rising sea levels, water scarcity, and over-development – apart from others like the “environmental harms caused by corporate interests (tourism, agribusiness and real estate) and military businesses (water bottling plants, cement factories and quarry mines). As the Guardian reported, these have “become “no-go areas” for academics and environmental groups. Also off limits is industrial pollution, contributing to thousands of premature deaths yearly in Cairo.” Instead, the report says, “a new cohort of environmentalist groups working on issues palatable to the government such as trash collection, recycling, renewables and international climate finance has emerged.”
Adam Tooze on the current state of the world economy.
“The expert appraisal committee of the Indian Ministry of Environment, Forest and Climate Change has recommended the grant of environmental and Coastal Regulation Zone (CRZ) clearance for a big infrastructure and tourism project in Great Nicobar Island that will lead to the diversion of 15 per cent of its forest area and the felling of 8.52 lakh (852,000) trees in phases. The project is being spearheaded by Andaman and Nicobar Islands Integrated Development Corporation under a vision plan conceived by the NITI Aayog. The island, mostly covered by forests, has not witnessed large-scale human activity so far.” This Mongabay story on the government’s plans for Great Nicobar uses maps to bring home the project's costs.
Dream, dare, and debt: how the disruptive ideas of Suzlon’s Tulsi Tanti changed the rules of the game. ET Prime looks back at Suzlon’s Tulsi Tanti.
How are India’s plans to make Lithium Ion Batteries coming along? ET Prime takes a closer look at what the PLI winners are up to.
The world is seeing a new cold war, writes Tim Sahay. The resulting geopolitics around resources need to be understood.