The Japanese engineering firm plans for proceeds to go towards low-carbon H2 and ammonia production and, more controversially, their use in power generation

Japan’s Mitsubishi Heavy Industries (MHI) has issued a new round of five-year green bonds worth ¥10bn ($67m) in order to finance its decarbonisation projects, including those focused on production and end-use of clean hydrogen.

MHI has set out what sectors proceeds from its green bonds will go towards, which it has recently updated to also include, among other zero-carbon technologies, synthetic fuels made from low-carbon H₂.

The list includes projects and technology to produce green hydrogen and ammonia from renewable energy, as well as blue and turquoise H₂ and NH₃ from fossil gas with carbon emissions captured and stored.

For end-use, MHI also plans to invest in hydrogen-based direct iron reduction for green steelmaking — as well as H₂ and ammonia for use in power generation. This includes co-firing with fossil gas in turbines or coal in thermal plants, as well as technology or projects for 100% hydrogen or ammonia firing.

The use of hydrogen or ammonia in power generation has faced strong criticism as a method to reduce emissions.

Analysts and environmental groups point out that co-firing with gas or coal still emits CO2 into the atmosphere, with any reduction in greenhouse gases minimal compared to direct use of renewable electricity, and could even extend the lifetime of fossil-fuelled assets despite climate concerns.

Even if only 100% clean hydrogen or ammonia is burned, critics have warned that the high cost of these molecules — even if produced where renewable electricity or fossil gas and carbon capture are cheap and then shipped to Japan — could drive up energy bills.

Burning hydrogen and ammonia also comes with the risk that air pollutants such as nitrogen oxides (NOx) will be emitted.

Despite these criticisms, Japan and its conglomerates have forged on ahead with plans to co-fire ammonia in existing coal-fired power plants.

MHI started to develop a gas turbine that could fire 100% ammonia in 2021, eyeing commercial roll-out in 2025, while this year it is scheduled to demonstrate a 100% hydrogen-fired 40MW gas turbine.

Source:Hydrogeninsight