Near-zero emission fuel can be accomplished by utilizing the easily sourced and powerful element hydrogen. Long-term national energy strategies often incorporate hydrogen for this reason. In South Korea and across the globe, traditional fuel sources are threatened by multiple factors like pipeline disruptions, resource availability, regulatory challenges, and global supply chain issues.
The recent trucking strike in South Korea affected the entire country’s energy infrastructure by upending the production of petrochemicals. Because South Korea relies almost entirely on fossil fuel imports to power the country, any delay in transport can have detrimental effects. This cascade has shown how vital it is to explore more easily accessible renewable energy resources, such as hydrogen fuel cells.
South Korea Hydrogen Economy Roadmap
South Korea had already begun laying the groundwork to support a robust renewable energy system to be carbon neutral in 2019. The country’s leadership detailed the country’s movement toward a hydrogen economy in its 2019 Hydrogen Economy Roadmap. The map comprises five chapters:
The Meaning of Hydrogen Economy for South Korea
A “hydrogen economy” describes an economy that emphasizes hydrogen as an environmentally friendly energy source. Hydrogen use will bring about radical changes within society and the national economy while also being a force behind economic growth. Ultimately, the pursuit of a society that has realized the unlimited potential of hydrogen is a hydrogen economy.
Hydrogen Significance and Expected Benefits in Economic Terms for South Korea
Hydrogen development can improve multiple sectors, including the transport and energy sectors. Hydrogen fuel cells can power electric vehicles, but hydrogen can also be used in commercial transport, ships, trains, machinery, and drones. Additionally, hydrogen can support electricity and heat systems.
The global hydrogen fuel cell market grows annually by 22 percent or higher, providing economic value outside of being an eco-friendly and highly efficient energy source. Job opportunities in various affiliated industries will also increase as storage, transportation, and utilization needs increase.
It is predicted that by 2040, the added value of hydrogen to South Korea’s economy will exceed KRW 43 trillion, equivalent to 2.5% of South Korea’s 2017 GDP. An estimated 420,000 jobs will be created, roughly 75% of the entire automobile industry workforce in 2018.
Hydrogen Significance and Expected Benefits for the Environment
Reducing greenhouse gases (GHGs) and fine dust from less clean energy sources will contribute to a cleaner and safer society. Decarbonization of energy consumption will greatly reduce GHGs and fine dust to ultimately lower social costs. An expected reduction of 27 million tons of carbon dioxide is predicted by 2040, the equivalent of nine 500MW coal-fired power generators. In 2040, hydrogen-powered vehicles could reduce fine dust by 2,373 tons. If South Korea continues to develop and expand its hydrogen industry, roughly 10.4 tons of oil equivalent (TOE) — equal to 5 percent of total energy consumption by domestic households in 2016 — will replace other energy consumption methods.
Potential and Limitations of Hydrogen Economy in South Korea
South Korean potential for promoting a hydrogen economy is high. Petrochemical plant infrastructure is already present, as is the experience of those involved. The physical infrastructure is well established and capable of effectively promoting development. Large-scale petrochemical complexes currently have a hydrogen pipeline with high purity production technology capable of annually producing, circulating, and utilizing 1.64 million tons of hydrogen.
There is also potential for hydrogen to be delivered through the existing LNG supply network. This would allow for a nationwide hydrogen production and supply system to be established without additional investment. The country has been mass-producing hydrogen fuel cells since 2013 and currently has top-level technology secured through alliances and mergers and acquisitions with foreign and domestic companies.
Limitations for hydrogen in South Korea include high costs, insufficient fueling infrastructure, and difficulties with applying the technology to public transportation. The lack of a comprehensive strategy and failed legal systems to promote the hydrogen economy are also hindrances to hydrogen progression.
Korea’s Hydrogen Strategy and Vision
South Korea aims to prioritize market creation and development of hydrogen utilizing industries to achieve the world’s largest market share in hydrogen fuel cell technology. The goal is to increase the number of hydrogen-powered buses to 40,000, taxis to 80,000, and trucks to 30,000. South Korea aims to domestically consume 2.9 million units and export 3.3 million units of hydrogen fuel cell vehicles. The government is expected to bear the burden of establishing and operating hydrogen support systems, but private sector companies will take over management and place more hydrogen filling stations.
For the power generation sector of the fuel cell industry, the intent is to introduce an LNG billing system for fuel cells, and weighted renewable supply certificates will be maintained to encourage fuel cell installation. The government will expand the hydrogen budget to distribute home fuel cells and provide financial incentives like an extension of the electricity tariff specialization system to ease the burden on the electric grid. The current 7MW distribution is expected to expand to 2.1GW or higher by 2040. This is the equivalent of 940,000 households.
The hydrogen supply sector must increase to sustain a growing hydrogen demand. The current demand is roughly 130,000 tons per year through hydrogen extraction and byproduct hydrogen. Hydrogen can be extracted from natural gas when there is insufficient demand. Hydrogen is a byproduct of petrochemical processes, and this hydrogen is currently used for hydrogen fuel cell EVs. If the industry grows as aimed for in this government road map, the total hydrogen demand is expected to increase to 5.26 million tons by 2040. The supply sources are expected to include overseas production and water electrolysis by 2040.
Hydrogen storage methods will need to be developed as demand and utilization increase. The current fleet of 500 low-pressure gas tube trailers and 200 km of hydrogen pipelines. High-pressure tubes must be developed to transport the increased hydrogen volume. New storage and transportation technology, such as those for liquid hydrogen and solid hydrogen, will be supported by the government to replace current compressed hydrogen systems.
The hydrogen economy roadmap’s core is that market creation, and growth prioritization will allow for accelerated development of the technology required by the market. This method will require the government to support technological advancement and ultimately result in a market-driven innovation system. The map was updated with the Basic Plan for Implementing the Hydrogen Economy of Korea by establishing a comprehensive strategy to meet the national targets set.
Current South Korean Hydrogen Projects
Hydrogen development has seen improvement in multiple sectors in South Korea, such as energy, electricity, commercial, transport, marine, and retail. In September 2021, the country held the inaugural Korea H2 Business Summit, which was attended by 15 companies already involved with the hydrogen economy. The companies in attendance, which included SK Group, POSCO Group, Hyundai Motors, and Hyosung Corporation, have entered into a council to promote hydrogen economy development in South Korea. They intend to provide policy recommendations to the government.
South Korea’s Energy and Industry
The Noeul Fuel Cell Facility has been operational since 2017 in Seoul. Korea Hydro and Nuclear Power, government companies, and POSCO Energy developed the 20MW fuel cell combined heat and power facility (CHP). Also in 2017, Korea South-East Power installed a 19.8MW fuel cell facility in Hwasung City that began operating commercially in 2020. The goal is to annually generate 165,000 megawatt-hours (MWh) of electricity and distribute it to 43,000 households within the Gyeonggi Province.
An agreement was reached with Korea Western Power and Samchully to develop an 80MW fuel cell facility that will supply electricity to roughly 185,000 households. In 2020, construction was completed on a 50MW fuel cell plant that is the world’s first to make use of byproduct hydrogen. This facility is the world’s largest hydrogen fuel cell power plant and will create 400,000 MWh of electricity. About 160,000 homes in the Chungnam Province will be supplied with electricity from this power plant.
South Korea boasts the largest proportion of operational hydrogen fuel cell electric vehicles (FCEVs). Roughly 19,500 vehicles — around 33% of the global total — are driven in South Korea, an increase from 29% market share in 2020. This number is expected to increase by 6.2 million hydrogen vehicles by 2040 as the government adds hydrogen FCEVs to the road. The country currently has around 170 hydrogen fueling stations, with more plans to increase this number to 1,200 by 2040.
Since the prototype was created in 2001, Hyundai has been working on core technologies for fuel cell electric vehicles. The company produced roughly 1,100 FCEVs in 2020 and will invest around 7.6 trillion South Korean won (KRW) into research and development in the next 10 years. Hyundai also established a hydrogen production facility to utilize byproduct gases from its affiliate steel production companies.
Hydrogen as the Future of South Korean Fuel
The discovery of electrolysis, a central process of hydrogen production at an industrial scale, at the turn of the 19th century opened the door for hydrogen energy. Less than 40 years later, the first electricity-producing hydrogen fuel cell was developed, and this has led to engineers and scientists in South Korea and the rest of the world racing toward hydrogen as a clean, abundant fuel source.
The benefits of hydrogen as a fuel source include the following:
- Supply security. The most abundant element in the universe is hydrogen, and it can be produced domestically using nuclear power, coal, biomass, natural gas, and clean energy sources. South Korea is experiencing a resource shortage that could affect its ability to generate its own fuel. Since hydrogen is abundant and easily sourced, it can help South Korea be more self-sufficient with energy production.
- Economic benefits. It is estimated hydrogen power could grow the South Korean economy by KRW 43 trillion (43 billion USD). It is also estimated the hydrogen industry will create 420,000 jobs in South Korea. Failing to break into this market could be disastrous for a smaller country like South Korea.
- Clean burning energy source. When hydrogen is combined with oxygen inside a fuel cell, it produces heat and electricity with a single byproduct of water vapor. When produced using clean energy sources, hydrogen can produce energy with nearly zero emissions. South Korea has an issue with fine particles and other pollution from less clean energy sources, so moving toward hydrogen energy will have significant effects on its ecosystem.
- Transportation options. Some forms of fuel require it to be stored and kept stable in a refined and usable state for long periods. Unlike these fuels, hydrogen can be easily transported in multiple forms — through a pipeline as a gas and in tanks as a liquid. Hydrogen is derived from water, an even more stable molecule with a pre-existing distribution infrastructure.
South Korea’s Race for Hydrogen Power
The South Korean Hydrogen Economy Roadmap describes many goals for movement toward hydrogen fuel. Still, the core of the strategy is to reach hydrogen creating over 60 percent of its 28-million-ton annual power demand by 2040. The country also aims to be a global leader in fuel cell electric vehicle production and deployment. South Korea is not the only country with lofty hydrogen power goals. Here is how its goal compares to some of these other countries:
- Canada. The Canadian Hydrogen Strategy outlines a goal to obtain 30% of its power generation through hydrogen and net zero emissions by 2050.
- India. India’s goal is to annually produce 5 million tons of “green” hydrogen by the year 2030.
- Australia. Australia’s goal is to reduce the price of hydrogen from an average of double-digit costs to AUD (Australian dollars) $2 per kilogram through the “H2 Under 2” program.
- Germany. Germany plans to work toward a hydrogen electrolysis capacity of 5 gigawatts.
South Korea’s Hydrogen Economy Roadmap is an attempt to drive the country into a globally competitive position with hydrogen power. The plan is ambitious, with steep goals and a short timeline of fewer than 20 years. Meeting its goals will require vital infrastructure that is only currently in the planning stage, but the country’s determination makes these goals possible.