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OPINION

Green Hydrogen Production: The Turning Point of the Nepalese Economy

With the global population on the rise, there is a significant increase in the demand for energy, creating a complex challenge that requires a comprehensive solution. Meeting the energy requirements of the growing population while ensuring environmental protection is crucial. Although various sources of energy are available, petroleum remains the primary energy source globally.
By Dr Shyam Raj Pokharel

With the global population on the rise, there is a significant increase in the demand for energy, creating a complex challenge that requires a comprehensive solution. Meeting the energy requirements of the growing population while ensuring environmental protection is crucial. Although various sources of energy are available, petroleum remains the primary energy source globally. However, as a fossil fuel, its combustion contributes to harmful emissions, particularly carbon dioxide, one of the most dangerous greenhouse gases. Furthermore, the limited availability and rising costs of petroleum have resulted in economic deficits in many underdeveloped countries. Political conflicts with petroleum-producing nations such as Iraq, Syria, Iran, and Venezuela have exacerbated the situation. The ongoing conflict between Russia and Ukraine has also had a significant impact on petroleum prices worldwide.


Given the pressing need to meet global energy demands, it is crucial to develop and embrace alternative energy solutions that are sustainable, affordable, and eco-friendly. This need is even more urgent for landlocked, small, and underdeveloped countries such as Nepal, which must maintain their independence and sovereignty. By adopting alternative energy solutions, Nepal could potentially reduce its dependence on costly imports, leading to significant economic benefits and a more sustainable future. Recent government data reveals that Nepal imports more than 2.66 million tonnes of oil and 480,000 tonnes of cooking gas annually. The cost of chemical fertilizer alone is USD 3.8 million, and that of fuel is about USD 8.7 million each year, which Nepal pays to India to fulfill its energy demand. However, political instability in Nepal could result in India quickly blocking the border and halting exports of these materials to Nepal. Therefore, it's essential to consider developing alternative energy sources to ensure Nepal's political stability, development, sovereignty, and independence.


Hydrogen, despite its abundance on Earth amounting to approximately 75%, is rarely found in a free state, with its percentage being below 0.001%. Green hydrogen is a promising alternative energy source that can help meet Nepal's energy needs. Hydroelectricity is the most efficient form of energy in Nepal, making it the best option for producing green hydrogen. Different studies reveal that splitting 1.0 kg of water using an electric current produces 110 g or 1235 liters of hydrogen. Unlike traditional fossil fuels, water electrolysis produces an emission-free fuel that's sustainable and can help transition to a carbon-free environment in the future. Green hydrogen can replace traditional fossil fuels in transportation, significantly reducing greenhouse gas emissions. Hydrogen finds its applications in petroleum refining, the treatment of metals, and food processing. Furthermore, green hydrogen can also be used in the industrial production of ammonia, a precursor agent for chemical fertilizers such as urea, ammonium phosphate, and ammonium sulfate.


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As a source of energy it can be employed in fuel cells to power vehicles and provide electricity. Hydrogen fuel cells have a high energy density and are more efficient than traditional combustion engines, making them an excellent option for powering vehicles. The heating value of gasoline is 47 megajoules per kilogram, while that of hydrogen is 143 megajoules per kilogram, making hydrogen almost three times more energy-efficient than gasoline. The reason for the difference in prices between hydrogen and gasoline is mainly due to the better fuel efficiency of hydrogen. Currently, gasoline costs an average of $3.5 per kilogram in the United States, while hydrogen is priced at $14.5 per kilogram. Although the price difference may seem significant, the superior fuel efficiency of hydrogen justifies the higher cost and indicates its potential as a feasible alternative to gasoline.


In the United States and Europe, companies such as Toyota and Hyundai have already commercialized hydrogen-fueled vehicles. China has also begun manufacturing hydrogen-fueled vehicles and commercializing them in its domestic market. Similarly, in India, companies like Tata Group and Mahindra are exploring hydrogen-fuel-based cars.


Hydrogen-fueled vehicles are already commercialized in developed countries, but Nepal lags behind with limited discourse among policymakers despite some research conducted by Kathmandu University in Dhulikhel Municipality. If large-scale hydrogen production facilities are established, the opportunity for international market exports will present itself. Currently, Germany and Spain are experiencing power shortages in their hydrogen production capacities and are actively seeking to import substantial quantities of green hydrogen from the three foremost African hydrogen producers: Egypt, South Africa, and Namibia. Similarly, Latin American countries Chile and Paraguay are working to establish green hydrogen plants. Chile has already signed agreements with the EU, France, and Belgium, while Paraguay is planning to export its products to England. Other potential candidates for consumption of their products include Germany, Japan, and South Korea, which use hydrogen in their auto industries. Currently, China is the biggest consumer of green hydrogen, utilizing it to produce ammonia and methanol and for petroleum refining.


Green hydrogen is essential for producing ammonia, the vital reagent for making urea, which can enhance agricultural products in countries like Nepal. This technology could enhance land productivity, generate employment, and contribute to sustainable economic growth. Studies show that ammonia-based fertilizers support the lives of 80% of the world's population. Countries without the capacity to produce green hydrogen rely on methane or coal feedstocks, which generate significant carbon emissions. Nepal can sustainably produce nitrogen-based fertilizers by combining electrolytically generated hydrogen with atmospheric nitrogen. This approach has proven effective in boosting the economies of other underdeveloped countries. For example, Sierra Leone, a developing nation in Western Africa, used to depend on importing more than 90% of its food from neighboring countries due to inadequate infrastructure and limited agricultural capabilities. However, after the agricultural revolution, the country has become self-sustainable in food production since 2021. Despite adverse natural conditions such as annual flooding and seasonal dryness, this revolution was made possible through the development of a green ammonia plant based on hydroelectricity.


The cost of erecting a fertilizer plant can fluctuate based on several factors, such as capacity, location, and the technological sophistication of the equipment and processes employed. These variables significantly impact the initial cost, which is currently estimated to range between $6.8-13.6 million, comprising expenses related to land, infrastructure, equipment, and other miscellaneous costs. Establishing agricultural plants is an expensive venture that requires substantial investment. However, suppose the government or private sector undertakes this initiative under a subsidized plan. In that case, it is possible to achieve the commercialization of agriculture, thereby making a significant contribution to the national economy.

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