Renewable energy provides an incredible opportunity for building a cleaner energy future. But it comes with a number of inherent downsides as well.
Wind, solar, tidal, and almost any other source of renewable energy is intermittent by nature, meaning it isn't on 24/7 and can only provide power at certain times. As the industry grows and more renewable energy is connected to the grid, this can create challenges for both grid operators and renewable energy developers.
But what if we rethought the grid altogether? What if electricity from renewable energy could be easily stored for future use -- even in our cars? That would truly be an energy revolution.
The future of renewable energy and fuel
It isn't often that an energy project is built that could change the energy industry, but one was just completed in the United Kingdom. ITM Power has built a project that consists of a 225 kW wind turbine, an electrolyser that turns the turbine's electricity into hydrogen, a 200 kg hydrogen storage system, and a hydrogen-dispensing unit and fuel cell for providing backup power.
If you're not familiar with hydrogen infrastructure, this would be similar to a battery being connected to a wind turbine with a charging station attached, but the energy is stored as hydrogen instead of in a battery -- and instead of a charger it's dispensing hydrogen fuel directly to vehicles.
This could have a number of implications for the energy industry if it's successful. It could change the way we fuel cars and could make renewable energy a viable base-load source of power. Let's take those points one at a time.
Image source: ITM Power.
The hydrogen car's big break
Tesla Motors gets a lot of the attention as far as alternative-fuel vehicles go these days, but a bigger company is betting on hydrogen, not batteries. You may have heard of it: Toyota Motors .
Instead of batteries, Toyota is putting its weight behind hydrogen-powered vehicles because it thinks hydrogen is faster-fueling and will lead to a much higher-performance vehicle long-term. In theory, Toyota's stance makes a lot of sense. Fueling up with hydrogen would be similar to filling up with gasoline, and a hydrogen-powered vehicle could forgo a lot of weight in batteries with a hydrogen fuel tank.
The problem is infrastructure.
There are only a handful of hydrogen fueling stations in the U.S., and nearly all of the fuel they're dispensing actually comes from natural gas. That compares to tens of thousands of electric-vehicle charging stations nationwide, so the battle is uphill for hydrogen.
But ITM Power's system could show a path to a hydrogen-fuel future. If electrolysers are used to turn electricity into hydrogen (which is fairly simple, but inefficient) it could make hydrogen fueling much easier than it is today. It could also make it possible to put a hydrogen filling station at each gas station, or generate hydrogen from a local renewable-energy power plant. That could make hydrogen both easier to find for drivers and also much cleaner than competing sources of energy -- including electricity.
Toyota, Hyundai , and Honda are the three big auto companies coming out with hydrogen vehicles, so there's some development on the auto front. What's missing from the equation is the fueling stations, especially stations getting their hydrogen from renewable energy. Maybe this shows a path forward for hydrogen vehicles?
Hydrogen powering the economy
The other big opportunity for hydrogen is in creating energy that could fuel the economy. Right now, electricity that's generated in power plants -- both renewable and fossil fuel -- has to be used at the time it's created or it's wasted in the grid. Only a small amount of energy storage exists in the world today, so renewable energy has to work within those technical confines.
Again, Elon Musk thinks he has the answer for this problem, building massive battery banks that could store energy generated during the day for future use. That's a decent solution for energy that needs to be stored for a few hours, but what about the bigger problems, like storing energy from sunny summer months for cold winter months when solar intensity falls dramatically?
Hydrogen could fill this void by being stored in tanks for use later that day or even months down the road. As with oil or natural gas, there could be an inventory of hydrogen that would keep the grid, and maybe even automobiles, running year-round.
This is a far-out projection, but ITM Power's project shows that it may not be as far off as we might think.
Upending the energy status quo
As investors, it's important to watch how companies are upending the status quo -- and in the energy field, it seems to be happening every day. Renewable energy is now lower-cost than fossil fuel energy in many parts of the world, and if the answer to intermittency can be solved by hydrogen, it could open up a trillion-dollar market.
The auto industry may be harder to crack, but with names like Toyota, Honda, and Hyundai behind hydrogen fuel, I wouldn't bet against it. Maybe renewable energy being transformed straight into renewable fuel could make for the next disruption in the auto industry.
All we know for sure is that with innovations like this, the companies that stand still will get left in the dust.
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The article This Hydrogen Project Could Be the Future of Energy originally appeared on Fool.com.By Motley Fool