Morocco Is A Green Leader & Might Get EU Hydrogen Balance Right

Ah, Morocco, home to more high-speed, electrified passenger rail than exists in all of North America, the 323-kilometer long service between Tangier, as well as the city of Rick and Ilsa’s doomed reunion. The plan is to extend that passenger service to 1,500 kilometers, almost exactly the same distance as Europe’s high-speed rail as a ratio of the geographical area covered.

The high-speed rail line is significant, in that it’s indicative of a key focus of Morocco’s government, to transform the country’s economy to a green one. The major policy levers include the National Sustainable Development Strategy, the Green Morocco Plan for agriculture and, inevitably, the Green Hydrogen Energy Transition Vector and Sustainable Growth plan. As part of the Corporate Europe Observatory (CEO) and The Transnational Institute (TNI) report on Europe’s efforts to turn Northern African into a hydrogen manufacturing center for Europe, I looked at Morocco’s green hydrogen strategies, thinking, and European influences. This article is a lengthier version of the report chapter on Morocco.

Moroccan solar and wind resource potential are excellent, maps courtesy Global Solar Atlas and Global Wind Atlas

And so, we have three precursors to green hydrogen in Morocco. We have a government focused on a decarbonized future. We have excellent wind and solar resources. And we have a government focused on green hydrogen.

Unsurprisingly, there are several efforts involving green hydrogen being considered in context of the EU and Morocco’s pre-COP26 announcement of a Green Partnership.

The Green Hydrogen Plan

The plan starts out well: “The establishment of a national industry based on hydrogen would firstly replace ammonia imports with a local production of this important raw material for the fertilizer.” (Translation from French by Google Translate.) The country imports 1.8 million tons of gray ammonia manufactured from hydrogen derived from fossil fuels annually. 

Chart of fertilizer consumption as a % of production courtesy World Bank

Chart of fertilizer consumption as a % of production courtesy World Bank

Morocco used to be a major fertilizer exporter. As fertilizer shifted from mining guano to being manufactured from black hydrogen combined with nitrogen from the air, Morocco shifted to being a massive importer of fossil-fuel sourced fertilizer, with 90% of its supply from elsewhere. This is a nuanced space however, as Morocco is simultaneously the world’s largest miner of phosphates, another key component of fertilizers. It exports the raw phosphates, however, and they represent perhaps a sixth of fertilizer use. 

As noted, ammonia-based fertilizer is a major climate change problem, with every ton having three tons of CO2e from upstream methane emissions, three tons of CO2 from its manufacturing from fossil fuels, and up to 6 tons of CO2e in the form of nitrous oxide with a global warming potential of 265 after application. Morocco’s agricultural sector provides 15% of its GDP and 60% of Morocco’s produce goes to the EU. Replacing grey ammonia with locally manufactured green hydrogen will have excellent climate benefits for both Morocco and the EU. 

The plan rapidly diverges into areas where hydrogen is being touted as an energy solution, but they don’t hold up to scrutiny. Mixing it with methane in natural gas pipelines has limits of 20% of volume even in the EU, would deliver only 6% of the energy as natural gas of equal volume, and requires more energy to pump. Using it as a vehicle fuel continues to be promoted, but battery electrification is going to dominate all but the most extreme modes of transportation, deep-water shipping and long-haul aviation. Replacing natural gas with hydrogen for electricity entails throwing away two-thirds of the electricity from renewables instead of just using the electricity directly.

The use of hydrogen in the refinery section to desulphurize crude oil will also diminish rapidly. As peak oil demand is reached later this decade, the first crude products to see diminishing demand will be high-sulphur fuels. Alberta’s heavy oil sands crude is already seeing a $14 quality discount, and that’s only going to increase. In a small handful of decades, only the cheapest to extract, sweetest, lightest crude that’s closest to water will find a market. The 55% of pure hydrogen used in refineries will be much less by the end of the century.

Synthetic fuels are much more expensive and lower CO2 avoidance than biofuels for those segments where battery electrification cannot be achieved.

Table from Carbon Engineering synthetic fuel case study by author

Table from Carbon Engineering synthetic fuel case study by author

This table shows the Carbon Engineering synthetic fuel manufactured in a high-renewables area compared to both conventional fuels and biofuels, the NREL e-kerosene row. The nature of assembling fuels from basic elements that have to be stripped from stable chemical configurations is very expensive. Biofuels let nature do the heavy lifting and initial processing, and advances in cellulosic — stalk — biofuels mean that they do not compete with food production.

The combination means that while green hydrogen manufactured in Morocco is an excellent way to eliminate high-emissions ammonia inputs, it’s poor for other envisaged uses.

German Hydrogen Partnership

The first collaboration is a hydrogen partnership with Germany, where the Moroccan Agency for Sustainable Energy (MASEN) would build a 100-MW renewable facility to manufacture green hydrogen. As pointed out in the article on hydrogen production, renewables in a narrower geographic region like Morocco will have two challenges. The first is that even a wind and solar farm with directly connected hydrogen manufacturing will have limited utilization of the hydrogen electrolyzer. As a result, electricity will have to be taken from the grid, with both significant cost implications at Morocco’s $108 USD per MWh, and significant CO2 issues given the coal-heavy nature of Morocco’s electricity. 

MASEN issued a request for proposal in 2020 looking for a technical advisor for hydrogen development in Morocco. The resultant study was to provide a market survey, main uses of hydrogen, a Morocco-specific evaluation, and recommendations. The report is not available publicly at this point that I could find, and it’s unclear who won the study. However, there are many consultancies working diligently to tell stakeholders what they want to hear about hydrogen’s sunny future.

Morocco would be well served to have the study results assessed by a third-party who is skeptical of hydrogen to provide a more nuanced perspective.

Ammonia Manufacturing (With Unproven Technology)

Next is a pure solar electrolysis play using the Irish firm Fusion Fuel’s proprietary direct solar to hydrogen process to manufacture 31,000 tons of hydrogen annually to feed manufacturing of 183,000 tons of green ammonia production. Fusion Fuel is a 2017 startup which purports to have a technology which cost-efficiently manufactures hydrogen using only solar energy and its proprietary micro-proton exchange membrane electrolysis unit embedded directly in the solar collectors. 

There are a few red flags with this. First, the test site for Fusion Fuel’s technology in Évora, Portugal, was to have been in production in mid-2021, but there is no indication that it is working at this point. Second, they claim efficiencies of 40% in converting solar energy to electricity, something at the outer limits of solar panel performance achievable in a minute percentage of circumstances, plus use of the 60% of waste thermal solar heat for efficient manufacturing. Commercial solar panel efficiency is typically in the range of 15%-20%. Third, they indicate that they can be plugged into the grid to deliver hydrogen overnight, despite losing the thermal heat component. Fourth, there are no third-party assessments of their claims. And lastly, they are one of the crop of SPAC reverse takeover companies I assessed recently, and have lost well over 80% of their market cap since peak, indicative of the challenges related to due diligence and claims in the blank check company space.

Despite these red flags, the global Greek-based firm Consolidated Contractors Company (CCC) has signed up to be the construction partner, and the energy and commodities trader Vitol has agreed to manage market sales of the ammonia.

While I rank the likelihood of Fusion Fuel’s claims being accurate to be low and the likelihood of their technology delivering 31,000 tons of reasonably priced hydrogen quite a bit lower, the good news is that initial plans are to use the hydrogen directly to manufacture ammonia to reduce fertilizer emissions.

Vitol has indicated that it will be looking at all markets for ammonia, including the potential for shipping it to the US. As Morocco is already an ammonia importer by ship, reversing that and shipping green ammonia to Europe is a more viable alternative. This is especially apt at this point as the importation of ammonia is challenged as the Black Sea port which is the starting point for the current gray ammonia journey to Morocco is closed due to the Russian invasion of Ukraine.

All organizations, and Morocco especially, should be very careful about making significant bets on unproven hydrogen technologies when there are proven technologies and vendors. As I said in the SPAC assessment, caveat emptor.

Shipping Hydrogen To The EU

More problematically, Morocco is considering green hydrogen exports in conjunction with IRENA. As Morocco does not have a working natural gas pipeline connection to the EU but only a defunct pipeline that it used to import natural gas from Algeria which it is considering as a potential hydrogen distribution pathway, the initial option is shipping. And shipping hydrogen is deeply problematic.

While short-sea hydrogen shipping isn’t quite as challenging as deep-sea shipping due to shorter routes, the technical and economic challenges persist. Hydrogen shipping requires liquifying it by chilling it to 24° Kelvin, close to absolute zero. It takes three times the energy to liquify hydrogen as it does to liquify natural gas, the obvious shipping energy comparison. Because liquid hydrogen is still less energy dense than liquid natural gas, a ship with the same volume can only carry 27% of the energy in hydrogen as in natural gas. 

The next issue is boil-off. Liquid hydrogen boils at just over 24° over absolute zero, and so must be kept in very large diameter ball-shaped tanks with thick insulation. Even then, the absolute best case scenario is that 0.2% of the hydrogen will boil off every day that the ship is in port and in transit. While liquid natural gas can be reliquified with equipment that can be carried onboard ships, this is not possible for hydrogen due to the much greater energy and technical requirements of getting it down to 24° Kelvin. And the hydrogen that boils off almost certainly won’t be usable to add to the fuel for the ship either, especially as short-sea shipping transitions to battery-electric. Short-sea shipping is shorter in duration, but busy ports at both ends suggest 15 days or 3% of energy loss is not an unreasonable number. 

The combination of low utilization factors or high electricity costs for electrolyzers in Morocco combined with the high cost per unit of energy delivered to the EU makes shipping deeply uneconomical. Morocco and IRENA should be very leery of shipping hydrogen as a chemical for use in industry in the EU, and even more leery of shipping it as an energy medium.

What Could Morocco Do With Renewable Electricity Instead Of Making Hydrogen For Export?

Morocco electricity by energy source

Morocco electricity by energy source courtesy IEA

The most obvious thing to do with renewable electricity is to use it to displace the over 27 GWh of electricity that they get from coal annually. Coal generation emits a metric megaton of CO2 per GWh of generation, so that 27 GWh of coal electricity is 27 MT of CO2 directly avoided if replaced with renewables.

Why exactly would it be beneficial to the climate for Morocco to take renewable electricity, make hydrogen and products from hydrogen, and ship them to Europe at significant loss of energy so that the EU can achieve climate emissions reductions?

If Morocco wants to be an energy supplier to the EU, there’s a clear path forward that makes much more sense. There is already a 1.5 GW capacity undersea transmission connection linking Spain and Morocco. MEDGRID HVDC plans and proposals would bring northern Africa into a larger pan-continental electricity grid with energy losses of only 3.5% per 1,000 km, and enable hydro, solar and wind to flow across a broader region, something that substantially combats intermittency.

Further, the UK-based Xlinks is developing a 3.6 GW undersea HVDC cable to bring electricity from a Morocco wind, solar and storage facility into the UK. That’s the future of energy transmission — moving electrons, not moving molecules.

But as the article started out by saying, Morocco’s first goal for green hydrogen is to manufacture green ammonia for fertilizers. That’s indicative of shrewd thinking on the part of Morocco’s leaders, and hints that they’ll be able to ride European hydrogen hype for investments in Moroccan infrastructure that are actually of value to the country. Given that they are shifting the electric high-speed passenger train to fully renewable electricity over the coming years, they continue to show leadership.




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