What is our assessment?

Based on our analysis, blue hydrogen is feasible and ready to deploy, but there is little real-world evidence for its effectiveness or ability to scale. The expansion of this technology to replace current grey hydrogen production or to support the transition to a global hydrogen economy will perpetuate and possibly expand the use of fossil fuels. Because of this risk, we conclude that producing blue hydrogen is “Not Recommended”.

What is it?

Blue hydrogen production is an industrial process that produces hydrogen (H₂) from fossil fuels – either natural gas or coal – combined with carbon capture and storage (CCS) technology to reduce CO₂ emissions produced during the process. Today, most hydrogen is grey hydrogen made from natural gas without any CCS. The addition of CCS prevents the release of some of the CO₂ generated during the hydrogen production process; capturing, concentrating, and then storing it permanently underground. 

Does it work?

The technologies for making hydrogen from natural gas, predominantly steam methane reformation (SMR), are well-established and have been used to produce hydrogen for close to a century. CCS technology is also available and currently deployed in multiple industrial and power generation applications. The SMR hydrogen production process generates GHG emissions from two sources: methane leaks from the gas used as feedstock and fuel used to power the production process, and GHG emissions from both the SMR process and combustion of gas (or other fuels) for energy, including CO₂, methane, nitrous oxide, and black carbon. CCS can be applied to capture CO₂ produced during the SMR process, for post-combustion capture of CO₂ from the plant’s energy use, or for both. Incorporating CCS to capture emissions from the H₂ production process adds costs and increases energy use, but it could theoretically reduce CO₂ emissions by more than 90%. However, current adoption of blue hydrogen is very low – less than 1% of global hydrogen production – and there is little real-world evidence to support its effectiveness and scalability. The few commercial facilities currently in operation capture only about 60% or less of the emitted CO₂. Because CCS is energy-intensive, it requires more fuel to power the blue hydrogen production plant. This can also increase fugitive methane leaks due to increased gas-powered energy consumption. If implemented adequately, carbon storage can be permanent. The captured CO₂ can also be used as a chemical precursor for the manufacture of other products or for enhanced oil recovery; however, these post-capture uses of CO₂ emit GHGs, thereby reducing or eliminating the emissions reduction efficacy of CCS. Currently, only ~8% of CO₂ captured from blue hydrogen production is injected into dedicated geological storage, with the rest used in industry, enhanced oil recovery, and other applications. 

Why are we excited?

Hydrogen can be combusted as a zero-emissions fuel, used to store energy to produce electricity, or deployed as a feedstock in industrial, transportation, and energy systems. The production of any hydrogen type – blue, grey, or green hydrogen – could facilitate the expansion of hydrogen infrastructure and the development of the global hydrogen economy, which is an important step in scaling hydrogen. Blue hydrogen is more technologically ready and cheaper than green hydrogen, which is made from water using electrolysis powered by renewable energy. Blue hydrogen is more expensive to produce than grey hydrogen, but the cost per ton of CO₂ removed could be relatively low. Estimates range from US$60–110/t CO₂, although these costs are uncertain and, with lower CCS effectiveness, they could increase to ~US$260/t CO₂. If implemented with low fugitive methane emissions and high CCS efficiencies, blue hydrogen could substantially reduce emissions compared to current grey hydrogen production. The climate impact of scaling blue hydrogen could be high. Estimates and targets for blue hydrogen production by 2050 range from ~30–85 Mt H₂. At that scale, even modest emissions savings relative to grey hydrogen would have a climate impact above 0.09 Gt CO₂‑eq/yr by 2050. However, achieving this depends on the quality of the infrastructure and rate of technology scaling, both of which are unproven. 

Why are we concerned?

Currently, 6% of the world’s natural gas and 2% of its coal are used to make hydrogen. As hydrogen production ramps up, blue hydrogen – even though it reduces production emissions compared to grey hydrogen – would perpetuate and could even increase the global market for fossil fuels. If the future implementation of green hydrogen is set back, blue hydrogen could create a long-term dependency on fossil fuels. Furthermore, any hydrogen produced from natural gas leads to methane leaks, regardless of whether CO₂ is captured. Methane is a potent short-lived GHG, meaning its impact on climate warming is stronger in the near-term. This is why reducing methane emissions is an urgent emergency brake climate action. Building and expanding a new industry that relies on natural gas as both a feedstock and fuel, and which inevitably leaks methane, is counterproductive to solving the climate crisis. 

If and when there is a transition to a global hydrogen economy, blue hydrogen is a less effective climate solution than green hydrogen. Although this technology could be a transitional solution between grey and green hydrogen, blue hydrogen risks diverting resources away from green hydrogen development or ready-to-deploy renewable energy technologies, such as onshore wind or distributed solar PV. There are mixed expert opinions about the realistic level of avoided emissions that blue hydrogen may reach. Additionally, there is uncertainty around whether CCS can meet its technical potential at a reasonable cost.