Making sense of the hydrogen rainbow

Hydrogen is often touted as a renewable energy lifeline for hard-to-abate industries such as concrete and steel manufacturing, aviation and shipping. But when I say hydrogen, do you think I’m referring to blue or green hydrogen? Or gray or pink? And which of these shades can be labeled "clean"? Let’s break everything down.

Before diving into the colors, let’s get on the same page about two things: how hydrogen is currently used and what "clean" hydrogen really means. First, hydrogen is most commonly used in petroleum refining and fertilizer production, with transportation and utilities representing emerging markets, a.k.a, the molecule is propping up fossil fuels.

Second, RMI has the best definition of clean hydrogen (in my opinion): "Hydrogen is ‘clean’ only if carbon emissions from its production, storage, distribution and use are low or zero." Because not all hydrogen is created equally.

The most emissions-heavy derivative today is gray hydrogen, which is produced using natural gas or coal via an energy-intensive process. Gray hydrogen is also by far the most common form of this fuel in the U.S., making up 95 percent of domestic use. Globally, hydrogen production contributes around 2 percent to total emissions. So, all-in-all, not really the green alternative we’re looking for.

Now, onto the more aesthetic colors in our rainbow of energy. Next on the spectrum is blue hydrogen. Blue isn’t all that different from gray (womp womp) in that it is produced using fossil fuels. What sets the two apart is the capture and storage of all carbon dioxide byproducts during the blue hydrogen production process. (Little-known fact: If you say the words "blue hydrogen" three times inside a coal-drawn circle, you will summon West Virginia Sen. Joe Manchin.)

Currently, blue hydrogen serves as common ground for some (definitely not all) renewable energy advocates and fossil fuel supporters alike. The global market for blue hydrogen was valued at $18.8 billion in 2022, and is projected to grow in the next eight years. The use of natural gas appeases the likes of ExxonMobile, which plans on using blue hydrogen to help decarbonize heavy industry. At the same time, since the CO2 is captured and stored, the emissions associated with creating the hydrogen are eliminated — assuming the method of carbon capture has a 100 percent effectiveness rate.

With blue hydrogen as the bridge between dirty and clean, let’s explore what lies on the other side: green hydrogen. Just the utterance of the words "green hydrogen" should trigger an imaginary chorus of terra angels in your ears, with visions of Mother Gaia descending from her lush, tree-filled cocoon to bestow light and peace on this planet. Seriously, though, green hydrogen is created via electrolysis, or the splitting of water into separate hydrogen and oxygen molecules, and requires an electrolyzer, which uses electric currents to split the chemical compound.

What elevates green hydrogen above the blue and gray varieties is the use of renewable energy sources to catalyze the electrolysis. So long as the input is renewably sourced, the production and subsequent use of green hydrogen is virtually carbon-free. In 2022, green hydrogen production grew 44 percent compared to 2021, and is expected to reach a market value of $60.6 billion by 2030; the transportation sector leads in use, accounting for around 40 percent of global green hydrogen sales in 2021.

Lastly, let’s consider pink hydrogen, an even less-developed variety, derived when nuclear fission is used to power electrolysis. Pink hydrogen production systems are still finding their footing, but prominent Swedish nuclear plant OKG, owned by Uniper and Fortum, did announce its intention a year ago to sell pink hydrogen to industrial gas company Linde. The plant has actually been producing pink hydrogen since the early 1990s as a form of nuclear reactor coolant. This specific case serves as a blueprint for repurposing infrastructure in the green transition.

And it looks like the European Union is taking that idea and running with it. On Feb. 13, the EU released a highly anticipated set of rules defining what renewable hydrogen means for its member states. Russia’s invasion of Ukraine and the associated fallout severely affected the EU’s access to oil and gas, forcing it to fast-track development of independently produced renewable energy. Green hydrogen is one promising solution to this multi-pronged dilemma. But because green hydrogen electrolysis is powered by renewable energy (wind, solar, hydro) many worry that production would commandeer all of the clean energy available on local grids.

The EU decided to bypass the issue by mandating that green hydrogen can only come from electrolyzers powered by newly built renewable electricity generation equipment located on-site. So, that means each green hydrogen plant would need its own on-site wind or solar farm. If, for some reason, the green hydrogen plant must connect to the grid, it would have to sign a power purchase agreement supporting the production of local renewable energy. These new rules are expected to boost the use of the aforementioned pink hydrogen, thanks in part to the aggressive lobbying of France to include nuclear plants as renewable energy sources.

In the United States, the Inflation Reduction Act is expected to exponentially increase the production of green and blue hydrogen. The International Council on Clean Transportation estimates that the IRA "can reduce the cost of green hydrogen production by almost half, falling to nearly $3 per [kilogram] hydrogen for a project starting in 2023."

And the market trends are indicating this estimation to be accurate. Andres Angulo, an energy analyst at GlobalData, explained, "As of January 2023, 90 percent of [new construction] hydrogen projects are green, reflecting … the number of EPC [engineering, procurement and construction] contractors participating in bigger green projects."

We’re officially living in a world where a vital form of energy is represented by a spinning rainbow wheel. Keep an eye on where the wheel ultimately stops.