5 mins read
Published Dec 8, 2024
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Challenges and Opportunities in Guarantee of Origin for Hydrogen
Hydrogen has recently emerged as a pivotal energy carrier in the quest for new energy solutions. Its versatility and potential to produce zero emissions make it a promising candidate for decarbonising industries ranging from transportation to heavy manufacturing. However, for hydrogen to fully realise its potential as a green energy source, consumers and industries must be able to trust that it is produced sustainably. This assurance is achieved through a guarantee of origin (GO), which verifies the production methods and environmental attributes of hydrogen.
As of 2024, there are no universal standards accepted around the globe to standardise and verify hydrogen produced from all pathways. This is why it is important to ensure that a reliable GO system for hydrogen addresses these challenges and key opportunities that arise from it. This article explores common obstacles faced by the hydrogen industry and how NoviqTech is addressing these challenges through its advanced GO solutions.
Why Guarantee of Origin for Hydrogen is Crucial
Hydrogen production is highly variable in its environmental impact. For example, green hydrogen is produced using renewable energy sources but uses natural resources like water, whereas grey hydrogen is derived from natural gas, resulting in substantial carbon emissions. The ability to differentiate between these types through a GO system is essential for building transparency, establishing consumer trust, and driving investments in hydrogen. This transparency also enables governments and industries to track natural resource use and emissions, ensuring compliance with local regulatory standards and environmental goals.
The Hydrogen Rainbow Showing Various Production Processes. Image Credit: Skillen et al., 2022.
Key Challenges in Guaranteeing the Origin of Hydrogen
Despite the critical role of a GO system, creating a reliable and transparent tracking framework is not without its difficulties:
1. Complex Supply Chains and Distribution
The hydrogen supply chain often involves multiple production, storage, and distribution stages, making it difficult to track its origin consistently from start to end. Each step — from production facilities to pipelines and storage centres — requires accurate tracking to maintain the integrity of its GO.
2. Lack of Global Standards for Certification
Currently, there is no universally accepted certification framework covering all hydrogen production pathways. Different countries are developing their own standards, leading to inconsistency across regions. Without global alignment, it becomes challenging to verify, for example, that green hydrogen in one country is equivalent to certified green hydrogen in another, creating hurdles for cross-border hydrogen trade and complicating international compliance.
3. Data Security and Transparency
Tracking hydrogen requires accurate data on production methods, emissions, and supply chain pathways. However, data transparency and security are challenging, especially when dealing with complex supply chains. Any misreporting or data tampering could undermine confidence in hydrogen markets, affecting both demand and investment in low carbon hydrogen.
4. Evolving Regulations and Compliance Requirements
The regulatory landscape for hydrogen production and distribution is still developing. Differing regulatory requirements across regions add complexity, as companies must navigate varying standards to maintain compliance. For a truly effective hydrogen GO system, these regulations need to be consistent, predictable, and aligned across countries to support global trade.
Opportunities in Guaranteeing Hydrogen’s Origin
While the challenges are substantial, there are equally compelling opportunities that NoviqTech is addressing through its Carbon Central platform:
1. Blockchain for Transparent Tracking
Blockchain technology offers an ideal solution for hydrogen origin tracking, providing a decentralised, tamper-proof ledger that records each step in the supply chain. Carbon Central leverages blockchain to create trustworthy records for each kilogram of hydrogen in real time as it is produced, ensuring customers receive reliable, transparent data on their energy origins.
2. Digital Twins for Real-Time Monitoring
Digital twin technology creates a real-time, virtual representation of hydrogen production and distribution processes. By using Carbon Central’s digital twin feature, companies can continuously monitor all inputs, outputs and emissions.
Carbon Central’s Digital Twin Feature to Track Hydrogen Production Processes
3. Government Incentives and Industry Support
Governments across the world recognise the potential of hydrogen as a clean energy source and are introducing incentives to support green hydrogen production and certification. Tracking hydrogen production in Carbon Central makes it easy for project proponents to leverage financial aid, tax credits, and subsidies for low carbon hydrogen through producing various reports.
4. Rising Market Demand for Verified Hydrogen
There is a growing demand from consumers, industries, and governments for verified, sustainable energy solutions. As awareness and demand for sustainable hydrogen rise, producers who can provide reliable guarantees of origin will have a significant advantage. This demand incentivises investments in GO technology, further driving innovation in the industry. NoviqTech is positioned to support these market shifts with its reliable GO solutions, allowing companies to meet consumer demands confidently and transparently.
The Path Forward
As hydrogen becomes an increasingly vital part of the energy transition, the need for robust, transparent GOs will only grow. While challenges persist, advancements in blockchain, digital twins, and global standardisation are paving the way for reliable GO systems that will accelerate hydrogen’s adoption as a sustainable energy carrier.
NoviqTech is committed to leading this transformation. Through its innovative technologies, NoviqTech empowers clients to confidently embrace sustainable hydrogen, ultimately building a cleaner, more accountable energy future.
