From coal to green hydrogen

By Federico Alberto Cuello Camilo

The addiction to coal is proving hard to overcome. Over one third of electricity generation and over two thirds of steel production rely on this most efficient ― and most polluting ― of fossil fuels.

It will be hard to decarbonize the world economy without replacing coal for energy generation and industrial use.

Paradoxically, it was global warming ― the heat wave of 2021 ― what led many countries to buy more coal and restart their coal-fired generators.

This situation questions the timid achievement of the 26th U.N. Climate Change Conference in Glasgow (COP26), where the wording accepted was to “phase down” ― and not to “phase out” ― the use of fossil fuels, as requested by major developing countries.

With war in Ukraine disrupting world energy markets further, how can we expect to phase down the use of fossil fuels such as coal? Of all conventional hydrocarbon fuels, the demand for liquefied natural gas (LNG) is expected to grow the most over the next decade.

Some countries rely on the spot market for their LNG, feeling fully the fluctuations in prices.

Others, such as Korea, have negotiated long-term supply contracts with the U.S., Qatar, Australia, Oman and Malaysia ― just to mention the top five ― smoothing the effects of the price shocks observed during 2021 by relying on dependable deliveries.

But the long-term objective is not just to replace coal with another fossil fuel, LNG, but to decarbonize our economies by becoming CO2-neutral. An energy transition of such scope can be achieved by replacing conventional fuels gradually but steadily with alternative, non-polluting sources.

It is precisely in Korea where the scenarios for this energy transition are likely to be matched by effective realizations. Since February 2021, Korea's new hydrogen law provides the policy framework for the alternative fuel that promises to transform the world's energy matrix.

The duration or intensity of solar radiation, winds or tides are unpredictable. A stable supply of renewable energy is possible only by storing electricity generated.

Batteries are the prime storage option. When interconnected to smart grids, supply and demand of renewable energy can be managed in a decentralized fashion. Technologies are available but their adoption will take time. This option, however, confronts several problems.

First, battery supplies are still insufficient and will probably remain so for the foreseeable future.

Second, there is a need to clean up the extraction and processing of the so-called “critical minerals” embodied in batteries, as well as in solar panels and wind turbines. Until such processes are achieved, the manufacture of these devices will not be fully clean and CO2-neutral.

And third, there has been a persistent level of “greenflation” observed since 2021 in the prices of the critical minerals ― including aluminum, bauxite, lithium, nickel, rare earth elements and many others ― due to high demand for them amid the energy transition.

The situation opens up space for another storage option: green hydrogen, produced through the electrolysis of water powered by renewables. In gas or liquid form, hydrogen could become the new source of baseline energy, potentially replacing LNG in electricity generation, heavy transport and industries such as cement, chemicals and steel.

Continuous innovations in Korea ― made possible by its hydrogen law ― are reducing costs and increasing energy generated by fuel cells, produced by leaders such as Bloom Energy, Hyundai Mobis, SK and others, which are competing already in price with conventional sources.

The energy transition in Korea is a long-term goal embodied in the Korean New Deal. It is the backbone to the country's long-term climate strategy, the 2050 Carbon Neutral Strategy, presented to the U.N. in 2020.

But because of the unfortunate war in Ukraine, necessity and urgency converge for us to accelerate the pace of the energy transition, as foreseen by an author who is rarely mentioned nowadays: futurist Alvin Toffler.

Toffler's writings on the energy transition in his book, “The Third Wave,” (1980) were prescient: “… Until new sources are substituted, the industrial nations will suffer recurrent, possibly violent withdrawal symptoms, with the struggle to substitute new forms of energy itself accelerating social and political transformation.”

The Dominican Republic's economy grew 12.3 percent in 2021. Renewables account already for almost 25 percent of installed capacity. But the growth of energy supplies is not keeping up with our fast growth rates.

The Dominican Republic is a net importer of coal, LNG and oil. Despite our rapid progress in renewables, our commitment to reduce 27 percent of emissions by 2030 requires working with Korea on an energy transition for which it has pioneered the public policy responses and mastered the technologies required.

The share of LNG in our energy matrix is increasing. But the future belongs to hydrogen, which should complement our other renewables and become a source of baseline energy, eventually replacing other conventional fuels and providing us with hope for energy independence, which is no small matter in these turbulent times.

Let us work together in decarbonizing the Dominican Republic's economy, as one of the pillars for a strengthened strategic partnership, marking our 60 years of bilateral relations.

Federico Alberto Cuello Camilo is the Dominican Republic's ambassador to Korea.