With a worldwide market estimated to be worth over $2.5 trillion a year by 2050, experts are looking to hydrogen as a huge opportunity for Alberta. It's going to require a coordinated approach from all three levels of government, however, to do it.
In this episode we talk with David Van Den Assem from Alberta Innovates and Kirk Hamilton from C-FER Technologies about hydrogen and what it could mean for Alberta's economy. They also discuss what Alberta Innovates, C-FER Technologies, InnoTech Alberta and Emissions Reduction Alberta are doing to propel it, and much, much more!
Welcome to Shift.
Bios
David Van Den Assem
David is a senior manager of clean technology at Alberta Innovates. He focuses on advancing innovative technologies from proof of concept through to field pilot stages in the field of carbon capture, utilization and sequestration (CCUS). The CCUS focus area is open to innovative next-generation technologies along the value chain within this area, including capture, compression, transport, mineralization, conversion, use, storage and measurement/monitoring/verification.
David also manages the hydrogen focus area and the critical minerals, mining and novel materials areas. These also are open to innovative technologies across the value chain and are aimed at building a low carbon hydrogen economy in Alberta, and advancing the extraction and use of critical minerals in Alberta to develop new industries, as well as developing high-tech materials to support energy storage, renewable energy development and other advanced materials such as carbon nanomaterials, etc.
David brings over 24 years of project management, business unit management and environmental leadership in several sectors, including power, oilsands, mining and real estate. His vision is to lead efforts to improve the ecological, social and economic footprint of these sectors, to improve our relationship with the natural environment.
Kirk Hamilton
Kirk Hamilton is a Senior Engineering Advisor with 20 years of advanced applied research and development experience at C-FER Technologies in Edmonton, Canada on a wide range of upstream and midstream energy topics. In his current role, Kirk works on strategic and business planning for C-FER identifying, developing, and implementing C FER’s strategic diversification objectives.
His current scope is addressing the technical challenges faced by global stakeholders in the transition to a hydrogen-based economy, in particular around pipeline transportation and underground storage of hydrogen. As part of this scope of activities, Kirk is working closely with the Transition Accelerator to assist the Edmonton Region Hydrogen Hub in building up the hydrogen economy in the Edmonton area as one of the world’s first hydrogen energy hubs.
In addition to his work for C-FER, he is also an active member of a number of American Petroleum Institute (API), Canadian Standards Association (CSA) and International Standardization Organization (ISO) technical committees on equipment and materials codes and standards. Kirk obtained a BSc. in Mechanical Engineering from the University of Alberta in 2001.
More reading
Shift by Alberta Innovates focuses on the people, businesses and organizations that are contributing to Alberta's strong tech ecosystem.
With a worldwide market estimated to be worth over $2.5 trillion a year by 2050, experts are looking to hydrogen as a huge opportunity for Alberta. It's going to require a coordinated approach from all three levels of government, however, to do it.
In this episode we talk with David Van Den Assem from Alberta Innovates and Kirk Hamilton from C-FER Technologies about hydrogen and what it could mean for Alberta's economy. They also discuss what Alberta Innovates, C-FER Technologies, InnoTech Alberta and Emissions Reduction Alberta are doing to propel it, and much, much more!
Welcome to Shift.
Bios
David Van Den Assem
David is a senior manager of clean technology at Alberta Innovates. He focuses on advancing innovative technologies from proof of concept through to field pilot stages in the field of carbon capture, utilization and sequestration (CCUS). The CCUS focus area is open to innovative next-generation technologies along the value chain within this area, including capture, compression, transport, mineralization, conversion, use, storage and measurement/monitoring/verification.
David also manages the hydrogen focus area and the critical minerals, mining and novel materials areas. These also are open to innovative technologies across the value chain and are aimed at building a low carbon hydrogen economy in Alberta, and advancing the extraction and use of critical minerals in Alberta to develop new industries, as well as developing high-tech materials to support energy storage, renewable energy development and other advanced materials such as carbon nanomaterials, etc.
David brings over 24 years of project management, business unit management and environmental leadership in several sectors, including power, oilsands, mining and real estate. His vision is to lead efforts to improve the ecological, social and economic footprint of these sectors, to improve our relationship with the natural environment.
Kirk Hamilton
Kirk Hamilton is a Senior Engineering Advisor with 20 years of advanced applied research and development experience at C-FER Technologies in Edmonton, Canada on a wide range of upstream and midstream energy topics. In his current role, Kirk works on strategic and business planning for C-FER identifying, developing, and implementing C FER’s strategic diversification objectives.
His current scope is addressing the technical challenges faced by global stakeholders in the transition to a hydrogen-based economy, in particular around pipeline transportation and underground storage of hydrogen. As part of this scope of activities, Kirk is working closely with the Transition Accelerator to assist the Edmonton Region Hydrogen Hub in building up the hydrogen economy in the Edmonton area as one of the world’s first hydrogen energy hubs.
In addition to his work for C-FER, he is also an active member of a number of American Petroleum Institute (API), Canadian Standards Association (CSA) and International Standardization Organization (ISO) technical committees on equipment and materials codes and standards. Kirk obtained a BSc. in Mechanical Engineering from the University of Alberta in 2001.
More reading
Shift by Alberta Innovates focuses on the people, businesses and organizations that are contributing to Alberta's strong tech ecosystem.
Jon:
Hydrogen is a key component for a decarbonized future in Alberta and the world. On this episode, we talk with David Van Den Assem, senior manager with clean technology at Alberta Innovates, and Kirk Hamilton, senior engineering advisor with C-FER Technologies, about the opportunities and challenges hydrogen represents for Alberta. We're at the cusp of something big, so grab a cup of coffee as we split atoms. Welcome to Shift.
Katie:
Hydrogen is a really hot topic right now. It seems like, every week, when I open the news, there's some hydrogen something going on. Kirk, why don't you start us off and tell us what's the big deal about hydrogen?
Kirk:
Sure, okay. Thanks, Katie. Hydrogen is being looked at around the world right now as a means to provide energy in a decarbonized way. Hydrogen itself isn't a source of energy but rather a carrier. We can produce it using renewable energy or with carbon capture techniques. It is a way to, again, meet those low-carbon requirements for our future energy needs. It's relatively easy to make. In Alberta in particular, we're quite good at making it.
Katie:
But, it doesn't naturally come without carbon, though, that's part of the conversion process, correct?
Kirk:
Well, if we're making it from fossil fuels, correct. If you are making it from water, from electrolysis, you're splitting the water molecule into its constituents, both hydrogen and oxygen, that does not produce carbon dioxide. However, if we are using methane or other fossil fuels as, I guess, the feedstock for the hydrogen, yes, you do produce CO2. We have to capture that, otherwise the process is not low-carbon. In fact, it's quite the opposite, it's very carbon intensive. Again, the carbon capture is a critical element to decarbonize hydrogen production when using fossil fuels as our feedstock.
Katie:
I'm assuming that in Alberta that's our primary source of carbon, is in those fossil fuels?
Kirk:
In terms of hydrogen, yes. No, yeah. Absolutely.
Katie:
Yeah. Sorry, yes.
Kirk:
David, correct me if I'm wrong, but I think 99.9% of the hydrogen we're producing is from methane or other fossil fuels. It is used almost exclusively at this point for industrial purposes, such as refining of our bitumen, and fertilizer production, and other petrochemical processes.
David:
Yeah, no. You're right. It is sourced from methane in this province. Those are currently the main applications for it, Kirk.
Jon:
Once we separate the hydrogen out the methane or something, we then have to sequester the carbon? What do we do with the carbon?
David:
Yeah, carbon can be used to make products. It can be sequestered in geological formations and there's different technologies out there that'll produce different things. You can produce carbon dioxide or you can produce solid carbon in the case of some technologies. There's a group of technologies called pyrolysis that in particular are of interest because you can generate hydrogen and solid carbon. You don't have to worry about sequestering it in geological formation. It's a bonus, it's a nice way to do it. Otherwise, you can utilize carbon dioxide for creating nano fibers, nano materials, enhancing the performance of [inaudible 00:04:09] in cement, so make better concrete with it, and a number of other applications that are being explored in the province and elsewhere. This is a pretty exciting time to be in the field. There's lots of activity happening.
Jon:
Yeah, no kidding. It's like a value add, really.
David:
Yes, exactly.
Kirk:
Yeah, that's just it, right? The challenge with, I guess, carbon dioxide management, I think, to this point is that it's not a commodity. It's always been viewed, or for the most part, as a waste product. Because of that, companies don't really place a value on it. However, if we do have it as a commodity that can be used into something and turned into something that can be used, now, we are more incentivized to capture and to use it, rather than just let it vent to atmosphere. Certainly, the other... and other levies that are coming or increasing at least from the federal level will provide other financial incentives. But, to David's point, I think we have a huge opportunity not only in the hydrogen space but also, I guess, the parallel space that is carbon dioxide to do something with this molecule because it isn't just a greenhouse gas. It actually has use.
Jon:
Right, right.
David:
You'll have seen some of the successes that came out of the Carbon XPRIZE, the COSIA NRG Carbon XPRIZE competition that was hosted at the Alberta Carbon Conversion Technology Centre in the southeast of Calgary at the Shepard Energy Center. A lot of great technology was being tested there, is now rolling into commercial operations. There's opportunity there.
Katie:
There's so much opportunity. When I looked at the winners and the results of that XPRIZE, I was really shocked to see that there was consumer goods, like soap and even vodka, as part of the carbon capture. It's so interesting. I had no idea that carbon could be used for really anything, if we're being honest.
David:
Yeah, it's a different way of looking at things.
Katie:
Yeah, it's really unique.
David:
Yeah, we're really excited about the opportunity. Sorry, Kirk. I'll let you jump in.
Kirk:
No, it's fine.
David:
But, we're excited about the opportunities that you can use to make something that will then improve the environmental performance and reduce the carbon footprint of the product that it's going into. Cement is a great example of that. Yeah. If you create products out of CO2 that enhance the strength and durability of cement and concrete, then you don't need as much cement or concrete to do the same duty as you would earlier. It is a very intensive process. If you are able to use less of that material, then the carbon footprint decreases dramatically. Things like that are happening and very exciting. Kirk, you were going to say?
Kirk:
Yeah. I think, again, it also comes back to the reason that I see that people don't connect carbon dioxide with utility is because of how it's been portrayed and how we view it. Again, it is seen as a root cause for a lot of the issues we're seeing with respect to climate change. Yes, I'm not going to deny it. Carbon dioxide has a direct link to climate change, but it can also be used somewhere else. We had to separate... carbon dioxide, it's just a molecule. What do you do with it? If we put it in the sky, yeah, it's going to create a greenhouse... it's a greenhouse gas and it's going to accelerate heating of the earth. But, if we use it elsewhere, it has that utility, just like other molecules that, if not used properly, can be damaging. It's, again, not about changing the narrative or denying the narrative, it's just, again, expanding it and rather saying, "Look it's not just one thing, but it's a wide range of things."
Jon:
I love that.
Katie:
I like that way of thinking about it. Yeah.
Jon:
Yeah, it's a very refreshing way of looking at it. Again, it comes back to that value add. But, let's hammer home on... get back to hydrogen specifically here. Now, for my own purposes, and I'm sure many out there, once you have the hydrogen molecule and you have a bunch of them together, is this a gas that can be condensed into a liquid or how does it look?
David:
You want to take lead on that one?
Kirk:
Yeah, I can. Hydrogen is a gas. You can turn it into a liquid, but that has to be... it's very, very cold. It's a very energy intensive process to get it to that point. We do store hydrogen as a liquid at surface. You'll see, at certain refineries and whatnot, they have these spherical storage tanks for hydrogen where they supercool it and keep it in those tanks. However, that's, again, as I said, very energy intensive. When we are going to be storing it and moving it around, it will likely be in a gas form because of it is... the economics, at this point, in moving it and storing it as liquid at such magnitude in terms of the volumes we're looking at as a broad commodity, it doesn't make sense at this point, at least from my end. David, do you have more insight on that?
David:
There's some providers that are planning on making liquid. In some circumstances, liquid hydrogen makes a lot of sense. There're certain applications where it can have some advantages, but you're right. It is energy intensive just to make it. Working on compressed hydrogen is what, I think, a lot of applications will see. For vehicles, for example, you'll see, most likely, vehicles will be compressed, not likely that they'll be using liquid hydrogen. We'll see that's part of the technology development process.
Kirk:
That's a good point, too. What we're saying right now... the technology development pace in this area is so rapid that what we say this week might be out of date next just because there are so many things that are happening and maybe there are step changes in technology that will enable us to move in areas we previously deemed uneconomic, and that's exciting.
Katie:
How is hydrogen going to help us get to net zero?
David:
Hydrogen is really good at providing energy and providing power. Again, I'll use vehicles as an example. In situations where it's really hard to capture carbon... so, if you think about driving your vehicle around, you're using, currently, most likely, gasoline or diesel. Carbon dioxide and other things are emitted out the back of the tailpipe. Capturing that is difficult because you're moving around. With hydrogen, you are centralizing the production of hydrogen. Any carbon that might be emitted can be captured in a centralized manner so that the hydrogen itself doesn't contain any carbon. It's just two hydrogen atoms stuck together. The energy between those two atoms and when you break that bond is where you get your energy from. It combines with oxygen that's in the air to form water. There's no emissions out of the tailpipe of, say, a hydrogen fuel cell electric vehicle. All the emissions are captured at the plant where the hydrogen's produced. You're able to decarbonize some of the more difficult to decarbonize sectors of the economy through using this energy carrier mechanism.
Jon:
Now, this isn't the first time I've heard of hydrogen fuel cells. I seem to remember, years ago, there was a company in Vancouver, can't remember the guy's name, but he was talking about hydrogen fuel cells. Why did that not catch on back then? I think this was probably two decades ago maybe. But, now, it's like-
Katie:
You're aging yourself, Jon. Holy-
Jon:
I'm only 21. But, now, like Katie opened with, this is a hot topic.
David:
Thanks for bringing that up, Jon. Ballard is the name you're trying to remember and they have been active in producing fuel cells for quite some time. It turns out most of their fuel cells are going overseas at the moment. They have a lot of traction with different companies and different countries, India, Europe, I think California is certainly picking things up. We're starting to see more traction here as well with some of the initiatives that are happening. In the West Coast, in Quebec and Ontario, we're starting to see more and more vehicles come into play that are using hydrogen. Ballard's really coming into their own. I think, to answer the question about where have they been, they have been active and they've been doing great things. We just haven't seen it locally until recently when the conditions are now become coming more suitable for hydrogen to take off. Yeah. It has to do with carbon pricing, with the availability of the technology, with all sorts of things. It's all coming together now.
Jon:
Fascinating.
Katie:
I know that the federal government's... I think it wasn't too long ago, maybe in June, they announced $2.3 million for a hydrogen fueling station in Edmonton and that's really targeted at the diesel trucks, the big diesel trucks, correct?
David:
That's right. Yeah, that's part of an Emissions Reduction Alberta-funded project as well called the Alberta Zero-Emissions Truck Electrification Consortium or AZETEC.
Katie:
Cool.
David:
Yeah. Oh, we love our acronyms, so that is developing and testing full hydrogen fuel cell, electric, heavy duty, long distance trucks. They'll be driving back and forth between Edmonton and Calgary during their test period over the next couple of years, probably maybe late next year and through 2023. They need, obviously, somewhere to fuel. There's a fueling station being put together right now at [inaudible 00:15:10], and interesting discussions going on as well about perhaps additional fueling stations for other projects that are also doing... hydrogen fuel cell buses, for example, and a few other things that are looking at Calgary as another location, so that's pretty exciting news. We're really... fingers crossed, get to see some activity happening there, too.
Jon:
Now, when you think about everything that's going on, and what I mean by that is electric vehicles, hydrogen power coming along, virtually, 90% of the population, if not more, having a regular internal combustion engine, how do you guys see... now, this is obviously longterm. But, how do you guys see this all transitioning? Is it hydrogen going to take over all of that or do you see things working in tandem? How does that look?
Kirk:
Again, I think we have to bear in mind that hydrogen, as an energy carrier, is one part of a future energy system. Electrification, and the use of electric vehicles, and other energy sources, including oil and gas, are all going to be part of that future energy mix. We are not going away from fossil fuels all together. Those are still going to be a critical element of the global energy supply.
Kirk:
We know that this is... the world population is increasing, the world's demand for energy is increasing. Even the uptake of renewables and the scale at which we can produce those, we can't draw down oil and gas and meet energy demands at the same time.
Kirk:
It's not possible. Where we see or I see it at least is, again, there's that natural expansion of the market, where, okay, there are going to be opportunities for hydrogen fuel cell vehicles where it makes sense, to David's point, things such as the AZETEC program are going to demonstrate the effectiveness of hydrogen fuel cells for heavy duty hauling. We're looking at other things, such as train locomotives and cargo ships, where it doesn't make sense to have a gigantic battery-powered system like an electric battery and perhaps fuel cells are more effective.
Kirk:
There's going to be financial incentives as governments around the world steer societies toward or away from more carbon intensive energy sources or more not just sources but uses such as internal combustion engines. But, again, we can't make blanket statements that, "Yeah, it's going to be this or that." I think there's going to be a mix. I do still think and I still believe that internal combustion engines are also going to improve. There's going to be a role for them somewhere. Again, I can't say what the mix is, but it's just... again, we have to look at this as... one of the things we see in the term transition is, "Oh, we're moving from one thing to another," but I see it a little differently in that we're transitioning to a different mix. The spectrum of energy sources, carriers, and uses are changing, and that's how I view it.
Katie:
I love that. But, when I think of transitioning, I don't just think of transitioning from one type of energy to another type of energy, I'm thinking about the infrastructure. Like, in Alberta, how are we going to transition our traditional oil and gas sector to a hydrogen sector, if we are? Is the infrastructure already in place? Can we convert some of the existing infrastructure? What does that look like from your guys' perspective, David?
Kirk:
Well, I think the hydrogen energy sector is a part of the oil and gas energy sector. If we're producing hydrogen from methane, natural gas is one of Alberta's and Western Canada's largest commodities. We will require a robust natural gas energy sector to make this a success and all of the refining and all the industrial processes that we already have in place. Again, we already produce a very large amount of hydrogen for... our existing process is about two-and-a-half to 3 million tons per year. Most of that isn't with carbon capture. But, again, as we build up new capacities, such as the Suncor-ATCO announcement, the Air Products hydrogen facility, we're going to be seeing improvements in that. Yes, we have that framework there. Now, when it comes from using it beyond, I guess, what you say, the fence of the production facilities, yes, that's where a lot of the questions remain. How do we deploy it into the community? How do we deploy it to other locations that may not be co-located with production?
Kirk:
We're looking at that at C-FER quite heavily in terms of what is the impact of hydrogen on legacy infrastructure, such as transmission pipelines, such as underground storage systems, because there's a huge amount of uncertainty in terms of how hydrogen impacts materials. Hydrogen itself is a very... or the hydrogen ion is a very challenging, I guess, no, it's not a molecule because it's an atom, to work with. It is very dangerous for steel because it's so small, it can penetrate into the steel and it can change the material response to certain load conditions. Under the right circumstances, we can have a reduced performance of those materials, such as increasing crack propagation under certain pressure cycling and fractured toughness, what we call it. Again, we have to know what we're doing... before we start to introduce hydrogen into these systems, we have to know how they're going to respond because, again, that comes back to, "Well, can we do this safely?" There's no way we're going to succeed in this if we can't do it safely and if we want to. There's a lot of questions that have to be answered at this point and a lot of work to be done.
Jon:
Kirk, this is the work that you're undertaking with C-FER right now is-
Kirk:
Yes, this is part of the work that we're undertaking right now. We just launched or announced the launch of a joint industry program as a global program. We had a meeting about three weeks ago, four weeks ago where we had companies from all over the world and pretty much every continent except for Antarctica meeting-
Katie:
I wonder why.
Kirk:
Well, they will probably need their... at the research stations there, they'll probably need fuel cells, but I'm not sure about pipelines yet. But, there's a lot of interest around the world about this. Basically, what we're proposing is looking at what is the impact of hydrogen on the remaining life of legacy assets. We're focusing right now on the pipelines. Again, there're so many different assets we have to examine, but pipelines are the big one. Here in Canada in particular, pipelines are a very sensitive topic. We want to make sure that we're using these properly because that's really... at the end of the day, if we can't move hydrogen from where it's produced to where it's going to be used, it's going to be hard to build a market for that.
Jon:
What I love about that is this whole notion of reduce, reuse, recycle that comes back to just creating that value add. Now, this work you're doing, how does that inform the work that you're doing, David?
David:
Well, we are focused on providing funding and investment in technology providers that are advancing new solutions to the market, new innovations. There's a tremendous need for developing better solutions for the new way that things are going to be done, so managing hydrogen, lighter, stronger tanks for mobile applications and stationary applications, better cooling compression systems, better pipe treatment systems, whether that's a liner, or coatings, or better metallurgy. There's just a lot of work that needs to be done to make sure that the system will roll out safely, effectively, and at a price that customers are happy with. There's lots of work to be done and lots of activity happening, so very exciting.
Katie:
I'm glad you mentioned price, David. I always like to ask about the economic benefits to Alberta. I think, according to the hydrogen roadmap document that the provincial government released, they said that, by 2050, we can expect hydrogen to be worth $2.5 trillion a year worldwide. How much of that is coming to Alberta? Do you know or can you guess?
David:
Well, that same document does give us a little bit of an idea of what we can expect to see as well as some of the other studies done by groups like the Transition Accelerator and others. We are seeing, from the Transition Accelerator in particular, a hundred billion-dollar market in Canada. Alberta, being such a predominant player in hydrogen production currently and anticipated in the future, about $67 billion of activity in the Alberta market, so that's very exciting. There's interesting opportunities with export to places like Japan and South Korea, for example, that don't have their own resources. They have to import. There have been conversations back and forth. Those are developing. Using numbers from the US hydrogen economy roadmap extrapolated to the Canadian application, it could be about a $15 billion a year opportunity just with export to those two jurisdictions. Lots, lots happening.
Jon:
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Kirk:
I just echoed David's comments. We're seeing a tremendous amount of growth. I was just in Abu Dhabi at the ADIPEC conference two weeks ago. There, you listen to... again, it's an oil and gas hub. UAE and Saudi Arabia, they produce massive amount of oil and gas, but all anybody could talk about at that conference was hydrogen. The amount of investment in that region going into hydrogen is equally staggering. They see the opportunity as well. They see the global growth and demand, the future demand, the same way we do. It's interesting. It's a very interesting time in the energy and, I guess, in the world right now where everybody seems to be glomming onto this idea at virtually the same time.
Kirk:
Everything is happening in unison. We are in discussions when I was there about how do we create these cross-jurisdictional partnerships, how do we create ways... yes, we're competitors in one way, but we also acknowledge that we're far enough apart. The market is vast enough that we're going to get there faster through collaboration, through cooperation, and help decarbonize the global economy more quickly, rather than trying to go at it alone and have a protectionist attitude over how we're going to make hydrogen or how we're going to deploy technologies to mitigate carbon emissions.
Katie:
We talked about the transition between our current infrastructure to hydrogen infrastructure, but one thing that's coming to my mind is talent. Do we have the people in Alberta currently to help us make this transition?
Kirk:
I think so. Two weeks ago, I was at ADIPEC. Yesterday, I was at the SPE Thermal Well Integrity Design Symposium... well, yeah, Integrity and Design Symposium. There, I was on a panel with Suncor and Shell. Both Suncor and Shell, their talks... mine was on the hydrogen opportunity. Again, the theme was sustainability in the oil and gas industry for our panel. Much of the talks or the theme of the talk was, again, how do we redeploy or adapt our skillsets as the oil and gas industry into these new areas. A lot of the skills are very transferable. Certainly, yes, we all need polishing up here and there. We are going to evolve in our careers as people do and that's where, again, I come back to this term about transition. We need to look at it not as... you're not transitioning yourself away from your career, you're transitioning yourself through your career and your jobs are evolving with what we need from the energy industry. It was interesting to watch the crowd's response go from, at first, skeptical to then, "Okay," understanding and embracing the message that was being communicated.
Katie:
David, something that I've also been thinking about, too, and I think that you might be in a better position to answer this... we're talking a lot about how big organizations, Alberta Innovates, C-FER, the provincial government, the federal government... how are we going to help this hydrogen innovation. But, what kind of things are we seeing from the small to medium size businesses, the entrepreneurs? Are they helping with this innovation? Are you seeing anything cool in the market?
David:
Well, the entrepreneurs and small to medium size businesses, they know an opportunity when they see it. They are very excited about all of the activity and all the action happening around hydrogen and CCUS in the province and regionally. Yes. There's a lot of interest and a lot of new ideas coming forward. We've been entertaining and supporting lots of technology providers to date and that's only going to increase dramatically. You've seen, recently, the Province of Alberta has put out its hydrogen roadmap. They've described the need for a hydrogen center of excellence where all of these different parties can come together, the technology providers, the service providers, the industry, academia. All of these groups need to work together to help make all this happen. Now, we, Alberta Innovates, InnoTech, C-FER, Emissions Reduction Alberta, are in the proposing stages of developing that hydrogen center of excellence. You heard it here first, very exciting.
Katie:
Yes, that is so exciting. Congratulations.
David:
Yeah, thank you. Well, we'll see how it goes. Like I said, we're in the proposal and planning stages. Lots can happen still. But, we're very excited about the opportunity and think that it would be a tremendous way to put Alberta on the global map for being a hydrogen hub regionally and just geographically.
Jon:
Now, that leads me to an interesting question. When I think about Kirk's comment that he was in the UAE, what is the perception of Canada globally and perhaps Alberta specifically in terms of hydrogen? Are we looked at as we're movers and shakers in this field?
Kirk:
In certain circles, yes. The UAE is half a world away and they're gigantic. Alberta is certainly known for certain things and Canada is a known energy provider. But, I think, too, Canada has a tremendous opportunity here. We need to move quickly on it because, as I said, the rest of the world is also moving in this. The perception is, "Okay, yeah. Canada, you're there. We see you." But, we missed... I think this is me speaking personally. I think we, as a country, missed an opportunity with LNG. You speak to the energy industry and they will acknowledge that, yes, Canada, because we didn't react fast enough and we blinked at the moment when others jumped in, we missed on LNG, which would've been a huge economic boost to our GDP. We don't want to do the same with hydrogen.
Kirk:
The rest of the world, yes, they see, "Okay, Canada has these resources." But, they also see Canada as... I wouldn't say not aggressive but certainly a little more conservative than other regions are right now.
Kirk:
Australia's already shipping hydrogen to Asian jurisdictions such as Japan. They're moving and that's why, again, we need to move. I think we can... I guess the... I said, okay, the perception of Canada is that we're conservative. On the other hand, we have the framework, from a regulatory perspective, here in Alberta to be very progressive and very active in this front. We have the framework, from the standards perspective, CSA and others, to regulate how we move, and produce, and store hydrogen. Again, we're moving faster than many jurisdictions. We're actually hosting delegations from all over the world even in the next couple weeks.
Kirk:
I've got one coming tomorrow. We've got another next week from other regions around the world that have told us their governments can't move fast enough. They want to look at investing in Alberta and looking and investing in projects here where they can learn about how to introduce hydrogen into their infrastructure, because the same information that we need, they also need. It is a bit of a... Yeah. On one hand, yes, we're seen as conservative. But, in other ways, we're seen as quite active it [inaudible 00:34:48] so, yeah...
Jon:
That's exciting.
Katie:
Kirk, if you were to ask the universe, wave your magic wand for... what do you need? What do you need from our government? What do you need from the ecosystem and industry to make this happen for Alberta?
Kirk:
Well, I think the key is government alignment at all levels and in all jurisdictions. Right now, we see hydrogen as an opportunity, we see opportunity from a federal level, we see it from a jurisdictional level. I think if all the provinces were aligned in that, "Hey, you know what? We have to work together on this. We don't have to worry about where it's coming... who does what and where and what piece of the pie is mine." We need to focus on getting hydrogen to the markets that need it, first and foremost, and that's going to be working in with governments, with First Nations groups, with other jurisdictions outside of the province and getting all that stakeholder engagement so that we're all bought in, because if we all believe in the why, why we're doing this and why we're producing hydrogen, why we're exporting it, the how and the what fall into place. If we can do that sooner... so I guess my question to the universe would be, can you help me... or can you help us make sure that everybody is on the same page and going in the same direction.
Katie:
David, would you-
Kirk:
If we have that, I think we can move forward.
Katie:
David, would you add to that?
David:
I fully agree with what Kirk just said. We absolutely have to be all pulling in the same direction if we want this to happen and happen at a pace that it needs to happen at. Yes, bold, underscore, highlighted. On the how, I think there's still a number of challenges that we need to overcome with building out the infrastructure, from an upstream perspective, as Kirk had mentioned, but also the downstream retail sector and end users, fleet transitions to hydrogen, and battery electric for that matter... but hydrogen where it's applicable. All of that takes a lot of effort. I think that the various different programs we see in other jurisdictions that are supporting that, I think, having those harmonized makes a lot of sense. Then, just rolling up our sleeves and doing the technology de-risking to get that next generation of stuff out there that is more cost-effective, is better quality, is more durable, is doing all the things that we need it to do so that we can continue to compete. Then, just on that competition side, it's a brief note, that we are in a position through our... and existing infrastructure, technology, and expertise, we're producing some of the least expensive hydrogen on the globe, in the planet, in the world.
Katie:
Oh, I didn't know that.
David:
Yeah. For low-carbon fossil fuel generated hydrogen, we are second [inaudible 00:38:04] in the world for producing the least cost hydrogen. For producing hydrogen through electrolysis, our friends east and west of us who have access to abundant low-carbon electricity sources can produce some of the least expensive electrolysis-sourced hydrogen in the world. We are in a fantastic position as a country and each region is in a fantastic position individually. Imagine what we could do collectively.
Katie:
Sorry, you made a comment about... we produce the second least expensive decarbonized hydrogen. Why is that?
David:
Because, we have access to the resource that we can extract very cost-effectively, we have the infrastructure, we know how to do it, we have the expertise, we have the refining capabilities. We have it all and it exists. Using it to leapfrog us into the next phase of our energy system puts us at a significant advantage over other areas. The resource is inexpensive to begin with for us, so it's a natural fit for us.
Katie:
[crosstalk 00:39:34] so it seems like we're halfway there, right? We've got carbon sequestration almost locked down and it's really cheap to create here. Guys, we're halfway there.
David:
Exactly.
Kirk:
[Crosstalk 00:39:50].
David:
We are on the cusp here of being able to just take a hold of the market, grab it, and run with it. Again, it's making sure all the horses are hitched up and running in the same direction.
Jon:
In terms of the market, that's where everybody's working together across the country and we can get product to market easier or is it...
Kirk:
Well-
Jon:
What's the big challenge there?
Kirk:
The challenge will be to make sure that the market demand, there we go, is sufficient, right? We have these broad and bold goals to produce massive amounts of hydrogen. Again, we're looking at 20 million tons by 2050 per year for across the country, that's a lot of hydrogen. We need to make sure, again, that that is how... where is that going? We're not just going to produce hydrogen because we can do it cheaply and because we're good at making it. Where are we using it? It is about, again, building up that demand. As a consumer side from... so if I'm switching hats from the person advising on the technology side... but, as a user of hydrogen, how am I going to... or adapt? I'm looking at my home, "Okay. Well, I've got to go from natural gas to a hydrogen burning furnace, or water heater, or... " embracing that kind of change and certainly being... if there's going to be rebate programs and whatnot, as the market adapts to absorb some of these costs of adaptation, that's really going to be fundamental. Without the market, this is all just a thought exercise.
Jon:
Guys, this is absolutely fascinating. I think there's a zillion ways we can go with it. The messages here, though, are we got the feedstock, we've got the infrastructure. We've got the skill and the talent. Let's align everybody and move forward on this. Let's continue to create an environment and create the knowledge for people to understand that this is a product that is feasible and can be affordable. But, everybody, again, needs to be aligned.
David:
Well said, Jon.
Jon:
Any final words?
Katie:
Thank you for joining us.
Jon:
Any final words for wrapping up here? David?
David:
I think exciting times are ahead. 2022 is going to be a pivotal year for Alberta in particular but for the sector as a whole across the country and around the world. It's going to be an exciting time. Looking forward to being able to give you some really interesting updates and follow up podcast in the near future.
Katie:
I would love that.
Jon:
Yup. Kirk?
Kirk:
No, I echo David's comments. The amount of energy and interest in this space is... I've never seen anything like it in my 20 years of working at C-FER. We seem well-poised and well-timed in this hydrogen endeavor as a province. I think, again, it sees that opportunity. Alberta was built on the ingenuity, built on the pioneering spirit. How do we move forward? I think, again, look what we did with oil sands. We took a resource that the rest of the world deemed, I guess, worthless. We turned it into this massive economic driver for the country. We take that mindset, that knowhow, just think of what we can do as a province in terms of how that applies to hydrogen. This is a tremendous opportunity in front of us and I think we're going to take advantage of it.
Jon:
Shift can be found online at shift.albertainnovates.ca or email us at shift@albertainnovates.ca. On behalf of everyone here, I'm Jon, until next time. Have a great day.