The role of hydrogen in decarbonizing Alberta’s electricity system
This paper explores the role that hydrogen can play in helping Alberta decarbonize its electricity system. Alberta has an abundance of natural gas resources that can be converted to hydrogen fuel and further used to generate electricity either through a turbine or through a fuel cell. Since Alberta has a significant portion of its current electricity needs supplied by combustion and steam turbines, such turbines can be repurposed to use hydrogen fuels and therefore reduce the amount of stranded assets as the province moves towards lower emissions in the electricity industry. Using hydrogen in the electricity industry can also complement a higher percentage of variable renewable energy resources, like wind and solar, by absorbing excess generation via electrolysis and providing much needed reliability as a peaking product. The carbon price and associated carbon policy in Alberta appears to be a key driver incentivizing hydrogen use in the electricity industry. Our model comparing the marginal costs of natural gas versus hydrogen for electricity production concludes that with the current carbon policy in Alberta and a rising carbon price to $170 per tonne CO2e in 2030, hydrogen has the potential to compete with natural gas as a dominant, "on-demand" power source.
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