Merchant Hydrogen: Industrial Gas and Energy Markets

 Published On: Sep, 2015 |    No of Pages: 127 |  Published By: BCC Research-JT Gabrielsen Consulting LLC Research | Format: PDF
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The global production of merchant hydrogen was 6.8 million metric tons in 2014, and is expected to reach 7.1 million metric tons in 2015 and 8.5 million metric tons by 2020, with a compound annual growth rate (CAGR) of 3.7% from 2015 to 2020.

This report provides:

-Investigation and assessment of the future use of merchant hydrogen and on-site distributed generation.
-Analyses of global market trends, with data from 2014, estimates for 2015, and projections of CAGRs through 2020.
-Definitions of individual markets and technical applications for hydrogen.
-Coverage of cutting-edge developments, areas such as biological processing, localized production, and nanotechnology where considerable research dollars are being spent.
-Detailed analyses of research focuses, end-use markets, and production technologies.
-Information on patent and intellectual property (IP) activity.
-An overview of the structure of the industry and extensive company profiles of the leading organizations in the field.

INTRODUCTION

OVERVIEW
The industrial hydrogen market consists of three distinct segments: refinery hydrogen; on-site supply; and merchant hydrogen. This report focuses entirely on merchant hydrogen, defined as the small to medium demand from industrial end users and the nascent hydrogen energy market. Merchant hydrogen is the hydrogen produced by one company for another’s use, delivered by pipeline, bulk liquid, tube truck, or cylinders. This report makes a very clear separation between hydrogen as an industrial gas and hydrogen as an energy fuel. The industrial gas market is enormous and reflects steady growth tied to the end-use industries it serves; the energy market is relatively small but growing rapidly, especially as fuel cell–powered vehicles (FCVs) grow in number and as the drive to perfect various forms of distributed electricity generation with fuel cells continues.

COMMERCIAL PRODUCTION AND END-USE MARKETS
Hydrogen is used primarily in petroleum refining and as a chemical intermediate, particularly in the manufacture of agricultural fertilizers. The cheapest way to produce hydrogen is by natural gas reformation or coal gasification at a central plant. Hydrogen, particularly high-purity hydrogen, can be obtained indirectly from electricity via water electrolysis, a usually costly process due to the high energy input. Because all current processes to produce hydrogen generate significant amounts of CO2 emissions, large-scale hydrogen production from natural gas and coal would be environmentally acceptable only if combined with carbon capture and storage technologies.

During the forecast period of this report (and in many cases beyond it), some essential technologies that could be deployed to produce hydrogen include fossil sources with carbon sequestration (coal and natural gas); renewable energy sources (solar, wind and hydroelectric); biological methods (biomass and biological); and nuclear energy. This report also discusses alternative methods for hydrogen production that are relevant to the merchant market.

Hydrogen has been thought of as the “fuel of the future” for decades due to its abundance as an element and its nonpolluting combustion products. Although 75% of the elemental matter of the entire universe is hydrogen, most hydrogen is bound up in compounds such as methane or water or more complex sources such as coal, and thus energy is required to break the hydrogen free from these compounds. Additional energy is required to purify, compress, and/or liquefy the hydrogen for storage and transportation to usage points. This energy input, as well as technical issues related to storage and transport, is what prevents widespread utilization of hydrogen. Widespread production, distribution, and use of hydrogen will require many innovations and investments to be made in efficient and environmentally acceptable production systems, transportation systems, storage systems, and usage devices, particularly fuel cells. In the U.S., virtually all hydrogen is made from natural gas, giving rise to significant quantities of unwanted and undesirable carbon dioxide (CO2) emissions. In particular, steam methane–reforming of natural gas produces about 12 kilograms of carbon dioxide equivalent per kilogram of hydrogen produced.

Despite the unfavorable economics for uses of hydrogen other than for refining and as a chemical intermediate, interest in it has always remained strong because hydrogen in transportation would not directly generate greenhouse gases. Moreover, if the hydrogen can be obtained via “renewable” resources such as wind or solar power or even biological processing, it would truly be emission-free.

SCOPE OF STUDY
This BCC Research study focuses on key hydrogen technologies and applications. It provides data about the size and growth of both captive and merchant hydrogen markets, lists company profiles, and discusses patent trends and industry trends. Cutting-edge developments, research priorities, and potential business opportunities are a key focus.

The report includes the following:

-Investigation and assessment of the future use of merchant hydrogen as an industrial gas and the roles likely played by the emerging hydrogen energy market.
-Analysis of trends in the market, with data for 2014, estimates for 2015, and projected compound annual growth rates (CAGRs) through 2020.
-An overview of the structure of the industry and extensive company profiles of the leading organizations.
-Detailed analyses of research focuses, end-use markets, and production technologies.
-Analysis of patent and intellectual property (IP) activity.

INTENDED AUDIENCE
This report was designed to provide a high-level overview of the merchant hydrogen market with particular emphasis on the emerging hydrogen energy markets that use merchant hydrogen. The report provides a primer on merchant hydrogen in the context of the global hydrogen market, its primary producers, and production technologies; current production process R&D; the use of hydrogen as a fuel in fuel cell–driven vehicles; and merchant hydrogen’s use in distributed electricity generation. Anyone seeking a comprehensive review of the current status of merchant hydrogen and the major players involved will find this report to be useful. Although current R&D is discussed, this report will be more relevant to business professionals interested in understanding the data and projections with regard to where this industrial chemical market appears to be headed.

METHODOLOGY
This study was prepared using both primary and secondary research methodologies. BCC Research reviewed the publically available data regarding forecasts of both production and capacity of the merchant hydrogen market in the U.S. The secondary sources include journals covering hydrogen and fuel cells and related books, trade literature, marketing literature, other product/promotional literature, annual reports, security analyst reports, and other publications. It is important to be aware that there is no commonly accepted basis to quantify the merchant hydrogen business sector among the major players or among government organizations. The summary of this report discusses this issue in detail. In particular, what constitutes that portion of the merchant hydrogen market serving refineries is a topic of considerable debate. This report relies on market segmentation based on interviews with others in public and private forecasting organizations. Consequently, the current and forecasted merchant production in this report is considerably higher than a 2011 BCC Research report on this topic.

The base year for analysis and projection is 2014. With 2014 as a baseline, BCC Research developed market projections for 2015 to 2020.

INFORMATION SOURCES
The primary data sources for the forecasts in this report include direct interviews with knowledgeable individuals in government and in private industry. In addition, we consulted secondary sources for the report, including industry journals and publications, product literature, white papers and technical journals, and financial reports/investor presentations for industry suppliers. An extensive patent analysis was conducted to gauge technological innovation and to determine research activity as it applies to new product development.
Chapter- 1: INTRODUCTION - Complimentary 4 $0
OVERVIEW
COMMERCIAL PRODUCTION AND END-USE MARKETS
SCOPE OF STUDY
INTENDED AUDIENCE
METHODOLOGY
INFORMATION SOURCES
ANALYST'S CREDENTIALS
RELATED BCC RESEARCH REPORTS
BCC RESEARCH WEBSITE
DISCLAIMER

Chapter- 2: SUMMARY 4 $250
INDUSTRIAL HYDROGEN AND ITS MARKET SEGMENTS
MERCHANT HYDROGEN
UNITS
MAJOR FINDINGS

Chapter- 3: INDUSTRIAL HYDROGEN MARKETS 15 $1355
HYDROGEN
GLOBAL PRODUCTION OF HYDROGEN
INDUSTRIAL HYDROGEN MARKETS-NORTH AMERICA
MERCHANT HYDROGEN MARKET
LARGE-SCALE MERCHANT HYDROGEN PRODUCTION TECHNOLOGIES
DISTRIBUTED HYDROGEN PRODUCTION
MERCHANT MARKET DELIVERY MODES
ECONOMICS
U.S. DEMAND FOR MERCHANT HYDROGEN
MERCHANT HYDROGEN COSTS AND END USERS
HYDROGEN PRODUCTION CAPACITY AT REFINERIES

Chapter- 4: GLOBAL MERCHANT HYDROGEN MARKETS 7 $632
GLOBAL MERCHANT HYDROGEN MARKET OVERVIEW
EUROPEAN MARKETS
CHINA
GLOBAL MERCHANT HYDROGEN PRODUCTION

Chapter- 5: NORTH AMERICAN MERCHANT HYDROGEN DEMAND 25 $2259
MARKET DEMAND AND END-USE MARKETS
MERCHANT INDUSTRIAL HYDROGEN MARKET DEMAND DRIVERS
HYDROGEN ENERGY MARKET DRIVERS
MERCHANT HYDROGEN EQUIPMENT MARKETS

Chapter- 6: NORTH AMERICAN MERCHANT PRODUCTION 7 $632
CURRENT HYDROGEN PRODUCTION LEVELS
LOCATION OF THE HYDROGEN REFINERY CAPACITY
LOCATION OF THE MERCHANT PLANTS
PLANNED EXPANSIONS FOR PRODUCTION
HYDROGEN FROM RENEWABLE RESOURCES
HOW RENEWABLE POWER RELATES TO MERCHANT HYDROGEN

Chapter- 7: MERCHANT HYDROGEN: TECHNOLOGY DEVELOPMENT 7 $632
OVERVIEW
EMERGING PRODUCTION TECHNOLOGIES
CATALYSTS

Chapter- 8: MERCHANT HYDROGEN DELIVERY MODES 6 $542
PIPELINES
CYLINDER AND TRUCK DELIVERY
ON-SITE PRODUCTION
HYDROGEN INFRASTRUCTURE ISSUES
Table 34 : TYPICAL HYDROGEN SALE QUANTITIES

Chapter- 9: HYDROGEN STORAGE 4 $361
STORAGE AND HYDROGEN-FUELED VEHICLES
HYDROGEN-FUELED VEHICLE STORAGE OPTIONS
HYDRIDE SOLID-STATE STORAGE

Chapter- 10: INDUSTRY STRUCTURE AND COMPANY PROFILES 26 $2349
MARKET CONCENTRATION
COMPANY PROFILES

Chapter- 11: PATENT ANALYSIS 16 $1446
HYDROGEN PRODUCTION, STORAGE, AND UTILIZATION
FUEL CELL SPECIFIC PATENTS
SAMPLE PATENTS

Chapter- 12: HYDROGEN GLOSSARY AND ACRONYMS 6 $542
HYDROGEN GLOSSARY AND ACRONYMS

List of Tables

Summary Table : GLOBAL PRODUCTION OF MERCHANT HYDROGEN BY REGION, THROUGH 2020
Table 1 : HYDROGEN PRODUCTION FEEDSTOCKS
Table 2 : GLOBAL HYDROGEN PRODUCTION BY SEGMENT, 2013
Table 3 : GLOBAL AND U.S. HYDROGEN PRODUCTION, 2009-2013
Table 4 : PRODUCTION AND VALUE OF THE U.S. MERCHANT HYDROGEN MARKET, THROUGH 2020
Table 5 : NORTH AMERICAN SHARE OF MERCHANT HYDROGEN CAPACITY BY INDUSTRY TYPE, 2014
Table 6 : NORTH AMERICAN SHARE OF MERCHANT HYDROGEN CAPACITY BY COMPANY, 2014
Table 7 : MERCHANT MARKET DELIVERY MODES
Table 8 : HYDROGEN'S SHARE OF OIL REFINERY FIXED AND VARIABLE OPERATING COSTS, 2014
Table 9 : FUEL CELL VEHICLE COST PER MILE USING DISTRIBUTED, NATURAL GAS–SOURCED HYDROGEN FUEL
Table 10 : U.S. MERCHANT HYDROGEN PRODUCTION, THROUGH 2020
Table 11 : GLOBAL PRODUCTION CAPACITY OF HYDROGEN AT PETROLEUM REFINERIES, 2008-2013
Table 12 : REGIONAL END USES OF HYDROGEN PRODUCTION, 2013
Table 13 : MERCHANT HYDROGEN PRODUCTION IN EUROPE, 2003-2013
Table 14 : FORECAST FOR MERCHANT HYDROGEN PRODUCTION IN EUROPE, THROUGH 2020
Table 15 : MERCHANT LIQUID AND COMPRESSED GAS HYDROGEN PRODUCTION CAPACITY IN EUROPE BY COMPANY AND LOCATION, 2014
Table 16 : EUROPEAN HYDROGEN PIPELINE MILES BY COUNTRY, 2014
Table 17 : EUROPEAN HYDROGEN PIPELINE MILES BY OWNER, 2014
Table 18 : CHINESE CONSUMPTION OF HYDROGEN BY END USE, 2014
Table 19 : GLOBAL PRODUCTION OF MERCHANT HYDROGEN BY REGION, THROUGH 2020
Table 20 : U.S. MERCHANT HYDROGEN DEMAND FORECAST BY END USE, THROUGH 2020
Table 21 : FY2014 AND FY2015 FEDERAL R&D BUDGET BY ACTIVITY
Table 22 : PHOSPHORIC ACID FUEL CELL CAPACITY BY STATE, 2014
Table 23 : MOLTEN CARBONATE FUEL CELL CAPACITY BY STATE, 2014
Table 24 : BLOOM ENERGY SOLID OXIDE FUEL CELL CAPACITY BY STATE, 2014
Table 25 : U.S. FUEL CELL BUS PROJECTS, 2014
Table 26 : U.S. HYDROGEN FUELING STATIONS, OPERATING OR PLANNED AS OF END OF 2014
Table 27 : MANUFACTURING R&D CHALLENGES FOR DISTRIBUTED HYDROGEN PRODUCTION
Table 28 : POWER PLANT CAPITAL AND OPERATING COSTS: FUEL CELLS VERSUS CONVENTIONAL OPTIONS, 2013
Table 29 : HYDROGEN PRODUCTION LEVELS, 2010-2014
Table 30 : TOP U.S. REFINERY HYDROGEN PRODUCERS, 2013
Table 31 : MERCHANT LIQUID AND COMPRESSED GAS HYDROGEN PRODUCTION CAPACITY IN THE U.S. AND CANADA BY COMPANY AND LOCATION, 2014
Table 32 : RENEWABLES-BASED HYDROGEN PRODUCTION PROJECTS, AS OF END 2014
Table 33 : APPROACHES TO USING RENEWABLE POWER TO PRODUCE HYDROGEN BY PROJECT CATEGORY
Table 34 : TYPICAL HYDROGEN SALE QUANTITIES
Table 35 : U.S. HYDROGEN PIPELINE MILES BY STATE, 2006-2014
Table 36 : NORTH AMERICAN HYDROGEN PIPELINE MILES BY OWNER, 2014
Table 37 : EXAMPLES OF VEHICLE COMPRESSED HYDROGEN STORAGE SYSTEMS
Table 38 : HYDROGEN SOLID-STATE STORAGE MATERIALS AND TRADE-OFFS
Table 39 : TOP U.S. REFINERY HYDROGEN PRODUCERS BASED ON CAPACITY, 2013
Table 40 : MERCHANT HYDROGEN PRODUCTION BY SUPPLIER, 2013
Table 41 : DISTRIBUTION OF HYDROGEN PATENTS BASED ON MAJOR FIELD OF APPLICATION, 2014

List of Figures

Summary Figure : GLOBAL PRODUCTION OF MERCHANT HYDROGEN BY REGION, 2014-2020
Figure 1 : HYDROGEN INDUSTRY TAXONOMY, 2013
Figure 2 : PROBABLE RANGE OF VALUE OF MERCHANT HYDROGEN MARKET, 2020
Figure 3 : THEORETICAL VOLATILITY IN PRICE OF HYDROGEN FROM NATURAL GAS, 2005-2014
Figure 4 : HYPOTHETICAL NET NON-DISCOUNTED CASH FLOW: FUEL CELLS VS. BATTERIES BY YEAR OF OPERATION
Figure 5 : HYPOTHETICAL ANNUALIZED TOTAL COST OF OWNERSHIP, CLASS III FORKLIFT, 2014

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