Will water scarcity derail green hydrogen?

• United Nations warns the world is heading towards a water supply crisis
• Green hydrogen developers could be hit by constraints to local supplies
• Companies must start engaging with these issues before it is too late

The world is heading into a water crisis due to “vampiric overconsumption”. That was the warning issued by Antonio Guterres, secretary-general of the United Nations, on 22nd March at the UN’s first conference on water security in almost half a century.

“Nearly three out of four natural disasters are linked to water,” he said. “One in four people lives without safely-managed water services or clean drinking water; and over 1.7billion people lack basic sanitation.”

It was a sobering assessment that echoed the findings of two recent reports.

The Global Commission on the Economics of Water published ‘Turning The Tide: A Call to Collective Action’ on 22nd March, which said global demand for fresh water could outstrip supply by 40% by 2030, with severe shortages in water-constrained regions. Meanwhile, the ‘Global Water Security 2023 Assessment’ from the UN on 23rd March warned that three-quarters of the global population – or 6.1billion – live in ‘water-insecure’ countries. Water security is a defining issue for this century.

But what does this mean for the burgeoning green hydrogen industry? Companies need two main ingredients – electricity and water – to create green hydrogen using electrolysis, but it is the first that gets most attention. Companies that don’t consider the supply of water to their production facilities could be left high and dry.

The Commission alludes to this challenge in its report, where it calls for coordinated strategies to tackle climate change and water security. It is aiming to “ensure that the transition to low-emission energy sources reduces, rather than increases, pressure on water resources… [There] is a real risk that we both exacerbate the water crisis and undermine efforts to halt or reduce the costs of climate change”.

Secure supplies

One key point is that green hydrogen plants should not deplete water supplies overall. In very simple terms, ‘green hydrogen’ is created when electricity is run through water using an electrolyser, to split hydrogen atoms from oxygen atoms. Water is ‘lost’ at this point because it has been changed into its two elements.

However, that water is not gone forever. When green hydrogen is turned into energy through a process called oxidation, either via combustion or a fuel cell, it produces the same amount of water that was electrolysed. This enters the atmosphere as water vapour and will at some point be recovered as liquid water. 

This is why ITM Power has written that “the widespread production and use of green hydrogen is expected to have a comparatively neutral effect upon Earth’s water and oxygen resources, and the increased adoption of renewable energy (as electricity and hydrogen) will serve to reduce water consumption”. Overall, it still uses far less water to produce green hydrogen than for oil and gas extraction: it takes around 10 litres of water to produce 1kg of hydrogen, the International Energy Agency has said.

But the IEA also said companies should carry out “careful assessment” when they plan to make hydrogen via electrolysis in renewables-rich but water-stressed regions “to help limit the depletion of freshwater resources”. This could include sunny and hot countries in the Middle East with enviable solar resources but vast areas of desert.

The challenge for developers is to locate their green hydrogen projects in areas with enough water and, if needed, learn whether they need to get involved in producing fresh water, such as by desalinating sea water or treating waste water. In this case, green hydrogen developers could provide an extra benefit to water-scarce regions, because excess treated water could be used for agriculture or for domestic purposes.

The threat of insufficient water supplies to projects is real: in May 2022, for example, Kallis Energy Investments scrapped plans for a 6GW green hydrogen plant in South Australia due to the risks associated with securing clean water. But there is still little public discussion about the need for secure water supplies at green hydrogen projects. This supports the UN’s case that many appear to take water for granted.

It may be possible to deliver a pilot project using mains water supplies, but that will be a less viable strategy as developments reach utility-scale.

‍Developer considerations

There are a few considerations that developers need to be aware of now.

The first is ensuring they think early about how they can guarantee supplies of water to projects and access water resources they need, especially in water-scarce areas. The reports highlighted earlier show that this is going to be a growing challenge and one that may have a knock-on effect on project economics if costs rise. Taking action now enables companies to anticipate water supply problems and become part of the solution.

The second is to keep a focus on water technology innovation, whether that it developing tech themselves or by testing innovations at green hydrogen pilot projects. For example, a study by the University of Adelaide in February said researchers had successfully produced green hydrogen by splitting sea water, and without the need for pre-treatment. This could be an important breakthrough given how sea water is abundant in many regions that are looking to grow their green hydrogen production. 

And third, developers need to be increasingly aware of the environmental credentials of where they source water. They are already focused on making sure that electricity used in green hydrogen production is from renewable sources, but they are likely to come under greater scrutiny to ensure their water source is similarly ‘green’. In practical terms, that may mean desalination plants powered by renewables too.

The overall message for developers is they need to engage with the issues of water security now, rather than wait for a global water crisis emerge. At very least, firms must take time to understand local water conditions when they are picking sites for their projects, as this will determine if their supplies are sustainable and cheap.

Water scarcity is a defining issue for this century. Good companies will ensure they aren’t making the problem worse. The best companies will help to fix it.