Shell Claps Back At Fortescue Green Hydrogen Scheme


Clean Power

Published on February 1st, 2021 |
by Tina Casey

February 1st, 2021 by Tina Casey 

Whelp, that was fast. Why it seems like only yesterday the green hydrogen industry was toddling around in the pilot project phase, and then last fall the Australian metals giant Fortescue Metals Group announced a record-shattering plan to develop 235 gigawatts of renewable energy around the world, all with the aim of pumping up the global market for green H2 and green ammonia, too. Now all of  a sudden here comes Royal Dutch Shell with some ideas about leveraging its global reach to cash in on the trend as well.

green hydrogen renewable energy

Seeking a competitive edge over other oil and gas giants, Shell banks on energy trading and flexes its renewable hydrogen muscle (via Shell).

Shell Spots Green Gold In Green Hydrogen

For those of you new to the topic, green hydrogen mainly refers to electrolysis, which involves subjecting water to an electrical current in order to push out hydrogen gas. Think H2O and you’re on the right track. There are other pathways for sustainable hydrogen production, but electrolysis has emerged as the weapon of choice due to the falling cost of wind and solar power, along with improvements in electrolysis technology.

Hydrogen has gained a foothold in practically every nook and corner of the global economy, and the primary source of hydrogen today is natural gas, so switching to renewable hydrogen is imperative for global decarbonization.

That’s why our ears perked up over the weekend, when Shell suddenly pulled a switcheroo. The company has begun making a name for itself as a wind and solar developer. Now it is shifting gears to become more of an intermediary between renewable energy developers and their customers, including those interested in green hydrogen.

Reuters has the scoop (follow that link for all the details). The story begins with “Royal Dutch Shell is betting on its expertise in power trading and rapid growth in hydrogen and biofuels markets as it shifts away from oil, rather than joining rivals in a scramble for renewable power assets,” and you can take it from there.

Shell’s Secret Hydrogen Weapon Is A Gas Station

Shell reportedly expects to shift away from oil while maintaining its natural gas interests. Interesting! The company does anticipate that global demand for hydrogen of any sort will increase faster than the green hydrogen sector can meet it, at least in the coming years, which means that Shell could continue to market natural gas for hydrogen production, even if (and when) the power sector sheds it.

On the other hand, the new focus on energy trading will help Shell build flexibility into a market in flux, and Shell itself may turn out to be a significant contributor to the flux.

Reuters suggests that Shell will keep at least some hand in developing renewable energy assets while leveraging another powerful asset in the form of 45,000 existing retail facilities around the globe, which are already positioned for the biofuel market.

We’re thinking sustainable hydrogen could also come into play. IBM, for example, is already exploring the energy-as-a-service benefits of on-site hydrogen production. As Reuters notes, Shell has been dipping into the  green hydrogen field here and there, and last month the company participated in a University of Texas roundtable on the potential for leveraging wind and solar resources to turn Texas into a sustainable H2 hub.

Those are large-scale projects, but a movement is also afoot to scale electrolysis down to the retail level. The US Department of Energy, for example, has been pairing up with the firm ISYS Energy on a modular, on-site renewable hydrogen fuel station that can fit into a space the size of a typical parking spot.

Shell may also be eyeballing the French oil and gas giant Total, which has been outfitting thousands of its service stations with solar panels. That’s just one step away from electrolysis, so stay tuned for more on that.

235 Gigawatts Of Renewable Energy Can’t Be Wrong

If the name of Shell’s game is flexibility, the company may also have an eye on last fall’s hydrogen news from Fortescue, which was also scooped by Reuters. All else being equal, Fortescue’s powerful position in the global metal supply chain provides it with a keen advantage over other renewable energy developers. By focusing on trading, Shell would have more room to maneuver around Fortescue and other competitors.

As reported by Reuters, Fortescue is aiming to deliver both green hydrogen and green ammonia, which is super interesting because ammonia is another one of those ubiquitous chemicals in the global supply chain that could use a cleanup in the decarbonization aisle.

Green ammonia began seeping onto the radar just a couple of years ago, as a means of making hydrogen transportation more cost-competitive (think NH3 and you’re on the right track).

There are some interesting green ammonia moves happening in the US, so pay close attention to the goings-on in Louisiana. The state is home to at least one leading ammonia producer and it is on the verge of exploiting its offshore wind resources.

The US Department of Energy is already exploring the idea of promoting green hydrogen-to-ammonia as a means of stimulating interest in distributed wind power among the nation’s farmers. The idea would be to use excess wind power to produce hydrogen for on-site fertilizer production.

More Green Hydrogen For President Joe

If Fortescue wants to get a jump on the competition, it better act fast. BP already has plans in the works for a massive renewable hydrogen and green ammonia facility in Fortescue’s home turf of Australia.

Meanwhile, over here in the US, some muscle has been added to the green hydrogen field by Mitsubishi, which has introduced new turbines for gas power plants that are engineered to transition into renewable hydrogen whenever it becomes available.

Mitsubishi is not letting the grass grow under its feet. The company has allied itself with other sustainable H2 stakeholders in the US, and since last fall it has announced a slew of new hydrogen-compatible gas turbine deals so stay tuned for more on that.

What all this means for newly minted President Joe Biden’s climate action plan is, well, really good. So far the US has proven fairly adept at developing its wind and solar resources, despite pushback from fossil fuel stakeholders. Sustainable hydrogen throws yet another spoon into the clean power pot.

As for Shell, keep an ear to the ground for additional movement in the direction of flexibility for decarbonization. The company’s recent initiatives include establishing an energy innovation incubator in partnership with the Energy Department’s National Renewable Energy Laboratory which hints at more news to come.

Follow me on Twitter.

Image: Renewable hydrogen projects in planning stages (courtesy of Shell). 


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Tags: Australia, BP, DOE, Electricity, Fortescue, green ammonia, green hydrogen, Hydrogen, Mitsubishi, NREL, shell, Total, united states, US

About the Author

Tina Casey specializes in military and corporate sustainability, advanced technology, emerging materials, biofuels, and water and wastewater issues. Tina’s articles are reposted frequently on Reuters, Scientific American, and many other sites. Views expressed are her own. Follow her on Twitter @TinaMCasey and Google+.


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