Latvian outlook
In Latvia we have plenty of energy available in the form of wind. Electricity, biofuels or hydrogen are just energy carriers — a way to transfer that energy from a source to consumers.
Main disadvantage of renewable energy sources like wind or solar energy is that they produce power inconsistently. On a windy day wind farm can produce twice the demand, on a cloudy day solar farm will produce half the demand. That is where hydrogen comes in. Hydrogen enables true potential of renewables, as it collects and stores energy that we get from renewable sources. Then we can use it later when needed or move it somewhere further. Hydrogen covers both storage and distribution of the energy. This also means providing resilience to the energy system, because an energy supply for industry or private individual usage across the country is one of the key properties of future energy market.
It would be foolish to rely only on an electrical power grid. Yes, in some cases it is the most efficient way to have direct supply of energy that can be used almost immediately by a consumer via wires. But when we have mismatches or fluctuations of power output, or we need to supply energy to difficult to access areas or mobile consumer, then hydrogen-based energy distribution system is the solution. Hydrogen collects, stores and provides ways to use energy when it is needed with the highest added value .
The end users of hydrogen are transportation sector, industry, heat supply, and feedstock. The latest is very important, because hydrogen is one of components in most of chemical products e.g. green methanol, green ammonia, green ethanol. So hydrogen availability would also boost Latvian chemical industry. And the more wind energy we collect the cheaper produced hydrogen gets. As a result, we can have our own fuel for transportation sector, heat supply, and energy production. This is the way to get an independent country-wide energy production and supply system, assuming that this system is resilient i.e. available for both energy carriers – electricity and hydrogen.
Need to scale
Hydrogen price depends on holistic approach. If wind energy is independent from main power grid, then we can collect much more energy from windmills, convert it into hydrogen and add it to the usage. The green energy price could be affordable already today, but we need to scale-up.
Here is an example: it will not be economically feasible to introduce just five buses on green hydrogen to the city's public transport as infrastructure and system maintenance will be too expensive. But if there is a fifty bus fleet, then a combination of wind mills, electrolyzers, refuel stations and fuel cell buses will lead to a balanced and feasible business case. And fossil fuel parity can be achieved.
It is a matter of approach – how to combine those ecosystems e.g. 50 fuel cell buses, 30 garbage tracks, 10 locomotives into one uniform system. We need this «hydrogen fleet». A lot of studies are looking at current state of hydrogen energy market, but we should not focus on a current state. The scale up projects oriented on a better future with green renewable energy replacing fossil fuel are necessary.
Green energy application
Today wind and hydrogen is one of the best combinations how we can get green energy delivered to transportation sector. Total cost of ownership is the key factor for the transport and this is the main issue as of now. According to recent studies for busses, trains, tracks, total cost of ownership for electric vehicles is about double to internal combustion vehicles. But this calculation is incorrect. We will see quite different picture when we calculate cost throughout vehicle lifetime, including service, fuel and depreciation. This would be the correct way to compare EVs and ICE vehicles. But today the decisions are usually based on blinded view on fuel cost only.
In case of buses, with the right size of the fleet it already makes sense to switch to green hydrogen today. Especially, if hydrogen production is supported by wind energy. Trains as well. Passenger cars are not there yet. In case of passenger cars there is also sentimental feeling in play. But hydrogen already makes sense for heavy duty applications: trains, buses, trucks, garbage tracks, ships.
Energy consumption of a country consist of electricity, heat and fuels. Each segment can be taken and analyzed separately. It provides us better understanding, which of those segments or sub-segment can be taken away from fossils and made climate friendly.
Conclusion
In Latvia demand for hydrogen is closely linked to the wind. The stronger are initiatives for wind energy the better will be adoption of hydrogen in the country. Especially for transportation.
The missing link is industry — at the moment it lacks understanding of opportunities that hydrogen can bring. But it is just a matter of time. We are already in the unstoppable process of progress and learning. We find new ideas, new ways to combine hydrogen. At the end of last year it was announced that 800MW of wind energy will come to Latvia. Only small part of this will go directly to electricity. Most of it will be beneficial to combine with green hydrogen production. This will bring the highest value to Latvia in form of cheap clean energy to all local consumers.