Several governments, operators, and suppliers are betting on hydrogen as a major tool to meet greenhouse gas goals. Regarding stainless steel, they are classified in one of two markets: discrete or process. The discrete market includes small flow control products used with fuel cells in mostly mobile applications. Process includes the production and transport of hydrogen.
By Robert McIlvaine, President & Founder, The McIlvaine Company
Discrete vs. Process
The discrete classification is defined as a flow control product associated with a piece of equipment. These are small with a required flow as small as 1 lpm. Many automotive companies are moving forward with hydrogen fueled vehicles.
Process is the classification of stainless steel flow control products used in the production and transport of hydrogen. This can also include their use in processes such as: steam generation, compression, creation of chemical products, or heat generation using combustion with hydrogen as the primary or secondary fuel.
Since the discrete market involves small flow control products and a unique set of customers, the suppliers are not the same companies furnishing the larger process flow control products. Stainless steel will be a major material used in the pumps, valves, tubing, hose, and piping which controls the flow of liquid, compressed and gaseous hydrogen.
Effects on the Market
While the process market preceded the discrete market, much of the industry activity is currently in the discrete segment. Over the next 15 years, it is expected that the process expansion will outstrip discrete. By 2040, however, the discrete market will advance while the process market slows down.
A detailed analysis has been made for the process flow control stainless purchases for hydrogen through 2028.1 The coverage includes:
Based on the analysis, much of the near-term stainless potential is in gray and blue hydrogen. Gray hydrogen includes the flow control for partial combustion as well as for purification processes.
The potential for yellow hydrogen is also substantial. Environmentalists have recognized the need for carbon negative processes, and biomass combustion with carbon capture and sequestration (BECCS) is the only cost-effective carbon negative option.
The conversion from gray to blue hydrogen similarly entails carbon capture and sequestration. As many flow control products are utilized in the absorption and separation as well as liquefaction and transport, this market will likely grow as well.
Multiple analyses of the flow control companies and the products which they are supplying for hydrogen applications shows that acquisitions are positioning some flow control companies to improve their market share. For example, Atlas Coco and Ingersoll Rand have moved from compressors to a whole range of low control equipment. They are major purchasers of stainless products.
The hydrogen process stainless flow control market is highly dependent on the mix of fuels for the power industry.
An electric car plugged into an electrical outlet can be used for fossil fuel. Using the fuel cell eliminates this route. The extent to which hydrogen currently replaces coal or gas for combustion has not led to an increase in flow control revenues. Flow control stainless expenditures per kWh can be compared.
If solar or wind is used to make hydrogen which then is used in fuel cells, the stainless flow control purchases could range from 20% to 70% of a coal fi red plant, when both production and use are considered, see Figure 3.
Hydrogen use is however, only one of the variables in determining stainless flow control sales to the power industry.
Creating yellow hydrogen using biomass will have niche uses, and as BECCS is just as yellow (carbon negative), this option will require the most stainless steel. Therefore, the extent to which BECCS is adopted will increase the stainless steel market.
There will be robust growth under the BECCS based strategy outlined here. If countries do not continue to strive for GHG emissions, to meet the Paris agreement (no regulations), there will be modest growth in line with GDP. With a mix of technologies such as those envisioned by IEA to meet net zero, there will be low growth. If the environmentalists were to dictate a mix heavily dependent on solar and wind (environmental), there would be significant revenue reduction over the next 10 years.
Today, electrolyzers, the devices used in production, typically utilize one of two technologies: low-pressure electrolysis or high-temperature electrolysis. Technological developments have already seen the progression up to large-scale 20 MW electrolyzers, and 100 MW units are not too far in the future.
For every kg of hydrogen produced, 9 kg of water must be consumed. Therefore, 2.3 Gt of hydrogen requires 20.5 Gt, or 20.5 billion m3, freshwater per, which accounts for 1.5 ppm of Earth’s available freshwater. Most applications for hydrogen require it to be combusted or pumped through a fuel cell, which converts hydrogen gas into electricity and water, but while most water can be recovered, it is not generally returned to the original body of water and will be treated as consumed.
The only sector in which the use of hydrogen does not regenerate the entirety of the water feedstock by fuel cell or combustion is chemical synthesis, which will account for 540 Mt of hydrogen, using at most 4.8 billion m3 or 0.3 ppm of global freshwater annually.
Ultimately, much of the process stainless flow market will be generated through fossil fuels using Small Modular Reactors (SMR) and other technologies. There are many variables as to the fate of gray and blue hydrogen. So constant updating of forecasts will be necessary.
- Stainless For Hydrogen Flow Control: published by the Mcilvaine Company