Hydrogen economic opportunities

Introduction

Hydrogen represents a significant economic opportunity for Alberta’s energy sector and the province. By 2050, it is expected that the world’s hydrogen economy will be worth trillions. Alberta is well positioned to be a key part of the global hydrogen economy.

The hydrogen economy is expected to bring both widespread direct and indirect economic benefits to Alberta. As world-scale hydrogen projects are developed, new employment opportunities are expected in the province for professionals, scientists, and trades while other energy sector jobs integrate with the new hydrogen economy.

By 2030, it is anticipated that the hydrogen economy in Alberta could bring tens of thousands of jobs and billions of dollars of economic activity during the construction phase, as well as thousands of jobs and hundreds of millions of dollars of economic activity during the project operations phase.

Hydrogen policy foundation

Alberta’s Natural Gas Strategy and Vision commits to

• pursue investment
• improve the province’s competitiveness
• expand Alberta’s access to new markets, and
• position a more diversified, resilient natural gas sector.

Alberta’s approach supports renewable and natural gas resources that are capable of producing low-carbon, clean hydrogen.

Alberta’s Hydrogen Roadmap further commits to actions related to hydrogen investment, including policy actions to reduce risk to investors, and enable access to capital for clean hydrogen production.

Investment advantages

Alberta has the resources and experience to produce some of the lowest cost, clean hydrogen in the world, these advantages include:

Energy resources

Alberta can leverage its existing natural gas reserves, renewable energy resources, extensive pipelines and energy infrastructure to play a leading role in Canada’s clean hydrogen economy. Alberta has low-cost natural gas a primary feedstock for hydrogen.

Environmental commitment

Alberta has world-class environmental standards and practices in place. Alberta’s strong environmental, social, and governance record is the foundation for a new strategy that will elevate leadership and accountability. Further, Alberta’s Emissions Reduction and Energy Development Plan positions Alberta as a global leader in emissions reductions, clean technology and innovation, and sustainable resource development.

Innovation leadership

Alberta is a committed leader in innovation, greenhouse gas emission reduction research, and carbon management. Alberta’s innovation agencies such as Emissions Reduction Alberta and Alberta Innovates have provided over $106 million in funding to 37 hydrogen projects. These projects include hydrogen powered buses, trucks, and locomotives, new hydrogen production technologies, hydrogen blending into utility markets, and development of hydrogen hubs.

Competitive business environment

On top of having the lowest corporate tax rate in Canada, Alberta offers the Alberta Petrochemicals Incentive Program. Under the program, when a project becomes operational, up to 12% of eligible capital costs will be returned in a grant to attract investment in the province’s hydrogen production facilities equipped with Carbon Capture, Utilization and Storage (CCUS). Alberta is home to world-scale CCUS projects, multiple industrial clusters, and has the geology to store sequestered carbon capture.

Experience and scale

Alberta is already the largest hydrogen producer in Canada. Alberta’s workforce knows how to safely produce, handle and use large quantities of hydrogen. The companies below have already invested in industrial processes for hydrogen.

Private hydrogen investment

Alberta’s private sector is already investing in the provincial hydrogen economy, recent projects include:

Projects for production, industrial processes, power generation and energy storage

•  Air Products’ Alberta Net-Zero Hydrogen Complex: This auto-thermal hydrogen production facility based in Edmonton is expected to be on-stream in 2024 producing clean, natural-gas based hydrogen.
• Dow Chemical’s Net-Zero Emissions Ethylene and Derivatives Facility: A proposal for the world’s first net-zero carbon emissions integrated ethylene cracker and derivatives facility in Alberta. The operation will be fuelled by hydrogen that is converted from cracker-off gas.
• Strathcona Refinery Renewable Diesel Expansion: Imperial is constructing a renewable diesel complex with carbon capture that will source natural gas-based hydrogen as feedstock.
• Battle River Carbon Hub: Heartland Generation is converting the Battle River Generating Station, a legacy coal-fired generation facility, to Canada’s first large-scale 100% clean hydrogen-fired electricity generation facility.
• Capital Power Hydrogen-Capable Gas Turbines: New Mitsubishi Power gas turbines acquired by Capital Power for its coal-to-gas conversions at the Genesee generating station are hydrogen-capable and, able to operate with a mixture of natural gas and up to 30% hydrogen with future conversion up to 100% hydrogen.

Projects for vehicle transportation

• Alberta Zero Emissions Truck Electrification Collaboration (AZETEC): Several organizations in Alberta have collaborated on a 700 km range hydrogen fuel cell electric truck that will carry freight between Edmonton and Calgary.
• Alberta Zero Emission Hydrogen Transit (AZEHT): New Flyer is supplying two fuel cell electric buses powered with Ballard’s fuel cell technology to the City of Edmonton and Strathcona County.
• CPKC Hydrogen Locomotive Program: Canadian Pacific Kansas City (CPKC) is testing hydrogen-powered locomotives.
• Blue Hydrogen-Diesel Dual Fuel Engine Technology Development: The University of Alberta, partnered with The Transition Accelerator with partial funding from Alberta Innovates, to test a hydrogen delivery system and control software solution. A major engine original equipment manufacturer plans to demonstrate the co-injection of clean hydrogen and diesel into a Class 8 diesel internal combustion engine. 
• Edmonton International Airport’s Airport City Sustainability Campus: Edmonton International Airport announced a hydrogen-powered Airport City Sustainability Campus initiative with several companies, including JOIN, Mitsui, Hydra Energy, Hercules Logistics, VEXSL, Letenda, SBI Bioenergy, Toyota, and True Zero. The initiative includes hydrogen fuelling stations, hydrogen-fueled vehicles, and technology partnerships. This also includes a purchase of 100 Toyota Mirai hydrogen fuel cell electric vehicles that will be on Alberta’s roads soon.

Projects for export

• Pembina and Marubeni Memorandum of Agreement: Pembina and Marubeni are co-developing a low-carbon ammonia supply chain from Western Canada to Japan and other Asian markets, including a low-carbon hydrogen and ammonia production facility in Alberta’s Industrial Heartland.
• ATCO and Kansai Investment: ATCO and Kansai are developing an integrated clean fuels supply chain between Canada and Japan through the production of clean natural gas-based hydrogen that will be shipped to Japan.

Government hydrogen investment

The Alberta Indigenous Opportunities Corporation supports Indigenous communities participating in resource development projects. The corporation has the authority to provide up to $1 billion in loan guarantees to support the ability of Indigenous communities to raise capital and invest in natural resource projects.

The Government of Alberta has also created Invest Alberta, a Crown corporation dedicated to investment attraction with a mandate to engage the world and provide high-end, tailored support to investors and major new investment projects.

Alberta Innovates and Emissions Reduction Alberta are provincial public agencies that provide innovation ecosystem support. Both agencies have provided over $106 million in funding to 37 hydrogen projects. Alberta Innovates supports the Hydrogen Centre of Excellence, and is providing funding for early phase and industry growth programs, including funding for clean energy. Emissions Reduction Alberta is currently providing rounds of funding for innovative technology projects, as well as infrastructure upgrades for businesses.

Related resources

• Edmonton Region Hydrogen Hub: An alliance of government, Indigenous, and economic development organizations looking to kick-start the Edmonton Region’s hydrogen economy.

Contact

Connect with the Natural Gas Strategy and Engagement Branch:

Hours: 8:15 am to 4:30 pm (open Monday to Friday, closed statutory holidays)
Email: [email protected]

Mailing Address:
Alberta Energy and Minerals
Natural Gas Strategy and Engagement Branch
6th Floor, North Petroleum Plaza
9945 108 Street*
Edmonton, Alberta  T5K 2G6

* Couriers, please report to the 2nd floor.