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Gas giant Enbridge is receiving millions of dollars of new federal funding to help build Canada’s hydrogen economy.
On Monday, Energy and Natural Resources Canada announced $9 million for six hydrogen projects. Of the money announced, $5.9 million is flowing to Enbridge — $5 million for a study investigating the potential to blend hydrogen into the Ontario gas grid and $900,000 for a “hydrogen hybrid demonstration project” using existing wind and solar energy.
“Canadian businesses have the ambition and drive to provide clean energy solutions and become the supplier of choice in a net-zero world,” said Energy and Natural Resources Minister Jonathan Wilkinson in a statement. “Investments like the ones announced today are a great example of what the hydrogen opportunity can do for Canadians — helping create jobs, grow the economy and contribute to a sustainable future.”
Another $1.4 million was announced for TC Energy and Énergir’s Trans Québec & Maritimes Pipeline, which supplies natural gas to customers in Quebec, Atlantic Canada and the Northeast United States; $1.25 million for the University of British Columbia to develop methane pyrolysis technology (using heat to split hydrogen from methane), and $1 million to Ayrton Energy that is developing a technology to transport hydrogen over long distances.
Several million spread across a handful of projects may seem like small potatoes compared to other federal financing worth hundreds of millions, but Alex Cool-Fergus, Climate Action Network Canada’s national policy manager, is frustrated to see the federal government pump any money into the hydrogen sector. In an interview with Canada’s National Observer she called hydrogen an improbable “techno-fix” that has been effectively marketed by the fossil fuel industry.
The possible end uses for hydrogen are dwindling, which is eroding its forecasted demand. To put in perspective just how significant this is, four years ago Natural Resources Canada expected the global market could be worth up to $11.7 trillion, but now says it could be worth up to $1.9 trillion — an 84 per cent drop.
“It's disappointing to see that the federal government continues to invest in this false solution, and that disappointment is amplified by the fact that some of this money is going to massive companies that don't need any more money,” she said, calling it a “slap in the face.”
“If [fossil fuel companies are] going to be investing in this at all, they should be using their own profits.”
Last year, Enbridge posted $5.8 billion in profit and greenlit $10 billion worth of new projects. Enbridge told Canada’s National Observer the blending study is to understand how it can leverage its expanding natural gas network in Ontario — something the government expects will be part of a future hydrogen network.
“The study will also help assess the readiness of the natural gas system to handle hydrogen and explore a cost-recovery mechanism to encourage hydrogen production in Ontario,” Enbridge spokesperson Leanne McNaughton said. “This could lower the overall cost of hydrogen, making it more attractive for sectors that are challenging to decarbonize, such as transportation and industrial sectors.”
The use of public dollars to build a Canadian hydrogen economy comes as the industry struggles for relevance in a world increasingly turning to electricity for decarbonization needs.
Hydrogen is sometimes characterized as a Swiss Army knife of decarbonization, because it could be used in a wide range of sectors, from hydrogen-powered transportation to cleaning up dirty steel production. But electric vehicles have all but been declared the winner in their category, and electric arc furnaces, combined with recycled steel, appear to be more cost-effective ways to decarbonize the steel sector.
At the same time the global market for hydrogen is shrinking, BloombergNEF forecasts over 80 per cent of clean hydrogen will be supplied by just the U.S., China and Europe by 2030.
It’s against this backdrop that Canada is fighting for its place in the hydrogen supply chain.
Canada’s hydrogen strategy envisions scaling up a low-carbon hydrogen sector, using a regional approach. In places with strong renewable energy potential, such as Atlantic Canada, there are plans to produce “green” hydrogen using renewables. In Western Canada, the approach is largely focused on “blue” hydrogen produced with natural gas equipped with carbon capture. The federal government interchangeably calls the various colours “low carbon” or “clean” hydrogen — umbrella terms designed to capture both varieties, even though the emissions associated with the different types of production vary significantly.
In 2021, Cornell University professor Robert Howarth and Stanford professor Mark Jacobson published the first peer-reviewed study of blue hydrogen’s greenhouse gas emissions and uncovered its greenhouse gas footprint is more than 20 per cent higher than burning natural gas.
“Blue hydrogen is a creation of the fossil fuel industry,” Howath previously said in an interview with Canada’s National Observer. “It's clearly the gas industry's view of how to keep natural gas going indefinitely into the future in a carbon neutral world.”
For some supporters of hydrogen, building an industry that includes fossil fuel derived hydrogen could help it find its place in the economy of the future, to be decarbonized later, similar to how electric vehicles were rolled out before the power grid is fully clean. But for Cool-Fergus, the necessary pace of decarbonization to avoid catastrophic warming means there’s “no more room for these false solutions.”
“Whether it's blue hydrogen, whether it's green hydrogen, the reality is it's a dead end for almost every use of it, except for a couple of really hard to decarbonize industrial sectors,” she said. “So the question isn't so much what kind of hydrogen we're producing, it's more about how quickly are we electrifying everything?
“The fact that the government is spending so much time and resources on developing these strategies, these working groups, and all of the different investments that are happening is simply just a distraction from what we need to be doing,” she added.
Under Canada’s hydrogen strategy, a working group set up between the federal government and natural gas industry was launched to help develop recommendations. The natural gas working group was co-chaired by the Canadian Gas Association, and included Enbridge, TC Energy, Energir, Fortis, Woodside Energy, Canadian Natural Resources, Alberta Energy and several other groups.
Wilkinson’s office did not return a request for comment before publication.
Comments
Yet, another failure by the Liberal Party claiming to be working towards reducing carbon emissions, yet, continue to pour money into the fossil fuel industry that only encourages them to boost production and emissions. It seems the Liberal party wants to play both sides, which only costs and will costs tax payers more in the long run.
Justine Trudeau needs to seriously step down and time to get a real adult to running the party.
It's almost like there's a requirement for any modern, democratic government to try in fairness to encompass a burgeoning new landscape by giving everyone a shot, to be seen as "open for business," in keeping with the kind of economy we have, kind of like what was done with the covid vaccines, ordering some of them all to see which worked best.
The fact that this government was given so little credit for keeping the country afloat enough to enable the economy to rebound rapidly and avoid a recession while also attempting to minimize deaths shows just how deeply embedded the darkly destructive conservative narrative has actually become.
It's their most significant accomplishment, and for all intents and purposes their ONLY one; it's what they've become best at, but despite that being all they actually have on offer as government, they've still been able to dupe a truly stunning number of people. It started with the hidebound and ever more oblivious media operating somewhat as an artifact of another time, then social media did what IT does best--metastasized it.
For example, watching CNN coverage of the DNC, I was struck by the commentary afterward to see that a Republican had STILL been invited on the panel, at the Democrat's convention, not only despite what that despicable, disgusting party has DONE but what it continues to DO, and the guy still had the NERVE to display the trademark con smirk. I now see it as on a par with Malcolm McDowell's at the beginning and end of "A Clockwork Orange."
So again I suggest that so disrespectfully calling Trudeau "Justine" and not even a "real adult" is another manifestation of that aforementioned narrative.
Nice reference to Clockwork Orange - I often think of it when I watch Trudeau smirk his way through yet another breathless news conference.
Oh for another Tommy Douglas in Canada's Parliament!
Charlie Angus for PM!!!!
You mean the Republican who urged Republicans to support Kamala? Perhaps even the founder of the "Republicans for Kamala" organization?
At this point, far from all Republicans support Trump. Just for what it's worth.
“If [fossil fuel companies are] going to be investing in this at all, they should be using their own profits.” Absolutely! They're hardly short of lolly considering they've been raking it in even while these days greenwashing their very own 1950's + 1970's research which proved what they're doing would burn and flood the planet. Even now being taxpayer subsidized.
Hydrogen is another scam. How do you make H2. Run electricity through water. How do you make electricity? Fossil fuels or hydro or solar. We know what the fossil companies want. If the electricity comes form solar or other renewable then just use the electricity. Do not believe anything the fossil fuel industry says. And certainly don't give them (our) money.
Michael Grant 315ppm
Will the National Observer PLEASE send these comments to Energy and Natural Resources Minister Jonathan Wilkinson!
This government's capacity for obtuseness and lying never ceases to beggar the imagination.
Can someone please run a contest for a half-hour sit-down with Trudeau, to educate him about the differences between the various colors of hydrogen, to apprise him of the necessity of including burning and burned forests in our federal carbon output numbers, the fact that "carbon intensity" is not a "thing" when it comes to output numbers, and that output includes Scope 2 and Scope 3 emissions.
If I can understand it, there's no excuse for him not to.
Well it does appear as if more and more people are finally coming to grips with the problem of fossil fuel burning - in all its possible permutations. We urgently need to educate the generations coming up who will inherit the world we are damaging, and make it possible for ordinary joes and jills to understand the new technologies of energy generation. Even us seniors who spent lifetimes inhaling the toxins of internal combustion. coal burning plants and the poison emitted from gas stoves and heaters, not to mention tobacco smoke... are still bright enough to figure out fossil fuel bad!, solar, wind and other natural energy sources GOOD!
Enbridge and their ilk are nothing but a giant sucking corporate ne'er do well (welfare bum?) gobbling up tax paid subsidies to keep their demented heads above water. Let them drown. They won't be missed and the demand for workers in the sustainability trades will more than make up for their disappearance.
It is beyond frustrating that the federal government and all levels of government continue to pump money into:
1. Huge corporations that do not need financial support when they could instead be encouraging smaller businesses and startups so we are less dependent on powerful conglomerates. We could be growing smaller independents and projects to increase interest and entrepreneurship in green energy production.
2. Put most of our energy dollars to grow proven, reliable green energy sources like wind, solar and geothermal energy production like countries around the world are successfully doing.