The hydrogen hype in Nova Scotia shows no sign of deflating any time soon. The province has now approved not just one green hydrogen project, but two, and there are others in the works.
On April 12, 40 days after Bear Head Energy registered its Point Tupper “green hydrogen and ammonia production, storage and loading facility” for environmental assessment, Nova Scotia Environment and Climate Change Minister Timothy Halman approved the project.
Halman disregarded complaints from both the Guysborough County Inshore Fishermen’s Association and the Ecology Action Centre that the 30-day period for public consultation on the proposal with its 548 pages of text was simply too short.
He also ignored the litany of environmental concerns documented by the fishermen’s association. Their concerns included everything from the proposed destruction of nearly 8,000 square metres of precious eelgrass habitat for fish and crustaceans and also for carbon capture, to Bear Head’s failure to contact the fishing industry on the mainland side of the Canso Strait, “even though their development is projected to add 40-60 additional marine vessels travelling in and out.”
Halman’s approval also came despite concerns from the Mi’kmaq Rights Initiative about the project. These included worries about the project’s proximity to “known traditional use areas,” and dissatisfaction with Bear Head’s conclusion that there was “low to moderate” likelihood that the area contains pre-Contact archaeological resources. The Mi’kmaq Rights Initiative also expressed concerns about the “cumulative impacts” of many renewable energy projects around the Canso Strait.
Halman gave the go-ahead to the Bear Head Energy project just two months after he approved EverWind Fuels’ “Certified Green energy hydrogen and ammonia production” facility on the Canso Strait in Nova Scotia. EverWind plans to produce green hydrogen, convert it to green ammonia, and ship it to Germany, primarily for fertilizer production.
The climate colours of hydrogen
The Examiner has reported extensively on the EverWind project, and also on the hype and hyperbole surrounding hydrogen, which is often depicted as an important energy carrier in a decarbonized world, despite the high cost of producing it, problems transporting it, and even finding viable, workable applications for it.[1]
Related: EverWind Fuels’ ‘green hydrogen and ammonia’ project in Nova Scotia will be partly powered by coal
Related: The ‘hydrogen hyperbole epidemic’ comes to Nova Scotia
Related: Analyst: “green hydrogen” is a bunch of hot air
Related: Green-washing hydrogen with amendments to Nova Scotia’s Electricity Act
Hydrogen comes in a range of purported “colours,” although the gas is invisible. The colours are assigned on how carbon-intensive the hydrogen production is and how much damage it causes to the climate.
The least climate-friendly are “black” or “brown” hydrogen, produced using coal, and “grey” hydrogen, obtained by steam produced using methane, also known as natural gas. The latter is by far the most common colour of hydrogen produced today.
There is also “blue” hydrogen produced using natural gas, with carbon emissions supposedly captured and stored. However, a 2021 study found the greenhouse gas emissions from blue hydrogen are still greater than those from simply burning natural gas, and not much lower than for “grey” hydrogen.
The only climate-neutral hydrogen is “green,” produced using 100% renewable energy.
Therein lies one of the biggest questions about green hydrogen production in Nova Scotia: Where will all the renewable energy come from to produce all the green hydrogen?
The Energy Mix reported recently that the European Union specifies that certified green hydrogen cannot “cause a net increase in emissions by diverting renewable resources from other sectors.”
Nova Scotia Power is struggling to meet the deadline imposed by Nova Scotia’s Electricity Act that stipulates that 80% of its grid must be supplied by renewable energy by 2030. Its coal-fired plants still accounted for 41% of the province’s electrical energy production as of June 2022. They must all be closed in just seven years. According to Nova Scotia Power spokesperson Jacqueline Foster, renewables — “mainly hydro and wind” — accounted for just 37% of the province’s power supply in 2022.
In other words, there is a big shortage of renewable energy in the province, not nearly enough even for Nova Scotia’s domestic needs. But that doesn’t seem to deter EverWind or Bear Head Energy from launching grandiose projects that will need absolutely massive amounts of it to produce hydrogen, which will be turned into ammonia and exported.
Related: ‘Green’ hydrogen industry takes aim at Nova Scotia’s underground salt deposits
Bear Head – from fossil fuels to green hydrogen
Bear Head Energy says it is proposing “to construct and operate a green hydrogen and ammonia production, storage and loading facility” at the “site of the previously approved, but not fully constructed Bear Head LNG [liquefied natural gas] Project in the Point Tupper Industrial Park on the Strait of Canso (Bear Head Site).”
Bear Head offers this brief history of the company’s ownership:
BHE is a Nova Scotia-registered company and owner of the previously approved Bear Head LNG Project. In July 2022, Buckeye Partners, L.P. (Buckeye) acquired BHE. Buckeye has one of North America’s largest energy midstream portfolios with operations throughout the U.S. and the Caribbean.
In fact, the Bear Head saga is a lot more complicated than that, with a long history of fossil fuel projects and changes of ownership since 2002 when a company called Access Northeast Energy applied for and two years later got provincial environmental approval to develop the LNG site. Two years later, it sold the Bear Head project to the American petroleum firm Anadarko. In 2014, Anadarko sold the unfinished facility to Bear Head LNG, which then applied again for environmental approval to “resume development” of the site at Point Tupper for LNG export.
The “executive team” of Bear Head then acquired “Bear Head LNG and Bear Paw Pipeline projects” in 2021, apparently having realized that two decades of unfulfilled LNG dreams weren’t going to fly. At some point the executive team recognized “that hydrogen and ammonia have unique characteristics as potential low carbon solutions” and that “Bear Head’s location in Nova Scotia offers unique advantages for clean energy projects.
And then in 2022, Buckeye Partners, headquarters Houston, Texas, “one of the largest independent liquid petroleum products pipeline operators in the U.S.,” decided to snap up Bear Head Energy.
Buckeye Partners, it turns out, had been acquired three years earlier by IFM Investors, an Australian private equity firm that manages US$90 billion worth of assets around the world. So the ultimate owner of the Bear Head Energy project in Point Tupper is from Australia, just like St Barbara, with its troubled gold mining properties in eastern Nova Scotia.
Bear Head Energy doesn’t reply to questions
In its environmental registration documents, Bear Head Energy says its “green hydrogen and ammonia” project will be constructed in multiple phases “driven by the availability of renewable power.” At “full build-out,” the Bear Head facility will be “capable of producing 2 million tonnes” of green ammonia a year. The ammonia will be shipped “to markets outside the region.”
Like the EverWind project, which is also located in Point Tupper and involves shipping ammonia internationally, Bear Head Energy plans to use fresh water from the nearby Landrie Lake Water Utility. Bear Head plans to use 15 million litres of water a day.
Bear Head says the final investment decision is planned for the end of 2024, and it estimates the first ammonia will “occur by mid-2028.”
This is what Bear Head says about the energy it will use to produce the hydrogen and ammonia:
Power supply for the Project will be provided from renewable power via the grid and/or direct power connection from primary new onshore and/or potential future offshore renewable energy projects.
The Halifax Examiner sent five detailed questions to Bear Head Energy about the project – twice.[2]
There has been no reply.
Green ammonia for Germany, which has ‘nothing to lose’
The Examiner then approached Larry Hughes, founding fellow at the MacEachen Institute for Public Policy and Governance and professor of electrical and computer engineering at Dalhousie University, for his thoughts on the hydrogen rush in Nova Scotia. He answered immediately.
Hughes said there are a couple of things worth considering about the companies involved. One is whether the plan is to build up interest in their projects and then sell to the highest bidder, whether the projects work or not.
EverWind Fuels is a “private developer” founded by its CEO Trent Vichie, who is resident in the United States and a former partner in the US private equity firm, Stonepeak Infrastructure. As Mary Campbell reported in the Cape Breton Spectator in July 2022, EverWind is a subsidiary of three firms — EverWind Fuel Holdings LLC, EverWind Fuels LLC, and Toronto Diamond Laredo LLC — that share the same address on the 10th floor at 122 Greenwich Avenue in New York.
And Bear Head Energy, as noted earlier, is owned by an Australian private equity fund.
Another consideration, Hughes wrote to the Examiner, is the overseas market for the ammonia. EverWind has signed memoranda of understanding (MOUs) “to negotiate a binding offtake agreement for 500,000 tonnes per annum of green ammonia” with two German corporations. But as Hughes pointed out:
As of about a month ago, Germany had signed 14 green-hydrogen/ammonia MOUs with groups and countries around the world. There are at least three here (two in NS and one in Newfoundland). Another is in Mauritania … The Germans have nothing to lose, the losers will be those scrambling to create green hydrogen at great expense, only to find it was a costly venture that led nowhere.
Canadians could also find themselves among the losers, thanks to the 2023 federal government budget. Measures in the budget mean the public will be financing these ventures through extremely generous investment tax credits (40% for “clean hydrogen”) and “innovative support mechanisms” through the Canada Growth Fund. Not surprisingly, EverWind “applauds” that budget.
EverWind has applied for public money from Canada’s Strategic Innovation Fund to finance its green hydrogen project and has four lobbyists working Parliament Hill. They’ve been lobbying everyone from the climate advisor in the Prime Minister’s Office to Canada’s Natural Resources Minister Jonathan Wilkinson, discussing, among other things, “taxation and finance.”
‘Where will the energy come from?’
In answer to the Examiner’s questions about the energy supplies for the two hydrogen projects, Hughes said, “If the plan is to create green hydrogen and green ammonia, they cannot use NSP [the Nova Scotia Power grid] because it will not be a ‘green’ source of electricity for decades to come.”
Hughes said it takes between 10 and 12 megawatt-hours of electricity to produce one tonne of ammonia.
A megawatt hour (MWh) is a million watt-hours, a gigawatt (GWh) is one billion watt-hours, and a terawatt hour (TWh) is one trillion watt-hours.
“To get two million tonnes of ammonia as Bear Head is proposing, they will need between 20 and 23 million TWh a year,” Hughes wrote in an email to the Examiner.
He referred the Examiner to a February 2023 article he penned, in which he noted that for EverWind to produce 200,000 tonnes at its hydrogen-ammonia facility in Point Tupper as it plans to do so it can start exporting that quantity of ammonia to Germany by 2025, the project would require 2,200 gigawatt-hours of electricity a year.
“To put this in perspective, in 2021, Nova Scotia Power produced slightly less than 11,000 gigawatt-hours of electricity and sold about 10,200 gigawatt-hours to its customers,” wrote Hughes. “In other words, the electricity requirements of a 200,000-tonne green ammonia facility are about one-fifth of Nova Scotia Power’s total production in 2021. Which raises the question, where will the energy come from?”
The Examiner asked EverWind for details on its proposed production timeline, energy requirements and the sources of that energy.
EverWind’s vice president corporate affairs Lynn Hammond replied that to produce 200,000 tonnes of green ammonia per year in 2025, the company will need about 2,000 GWh, which will be supplied primarily from “newly built wind farms, supplemented by additional renewable energy sources (e.g. solar). All power from Phase 1 will be allocated directly to newly built renewable energy sources through Power Purchase Agreements.” [emphasis in the original]
For Phase 2, starting in 2026, when EverWind plans to produce about 800,000 tonnes of green ammonia per year, Hammond said the company will require about 8,000 GWh of renewable energy. This will come primarily from “newly built wind farms, supplemented by additional renewable energy sources (e.g. solar). The wind farms will have a direct connection to the site.”
Hammond said no power purchase agreements have been finalized with Nova Scotia Power.
EverWind says it is “building the largest wind farm in the Western Hemisphere.” A February 2023 EverWind press release states it is “exclusively applying for leases on 137,000 acres [55,442 hectares] of Crown land” for a two-gigawatt onshore wind farm to supply the second phase of its “green hydrogen production facility by 2026.”
This, EverWind says, will enable the company to “reach 1 million tonnes of annual green ammonia production capacity by 2026.”
“Based on our 2GW wind farm, we expect production of approximately 8 million MWh, or 8,000 GWh,” Hammond told the Examiner. “As such, we would expect to produce about 800,000 tonnes of green ammonia with production from our 2GW wind farm. This, combined with our 200,000 tonnes from our first phase produces approximately 1 million tonnes per annum.”
This is an absolutely massive project, and the figures do not jibe with Hughes’ calculations.
According to Hughes, the two-gigawatt onshore wind farm would require 330 six-megawatt wind turbines, and it could supply about 7,900 GWh a year. That is 30 more than the 300 commercial wind turbines currently generating electricity in all of Nova Scotia.
Hughes said it would still not be enough green energy to produce a million tonnes of green hydrogen and ammonia, which would require about 11,000 gigawatt-hours of electricity a year.
“This is as much electricity as Nova Scotia Power produced in 2021,” said Hughes. “Where will EverWind get this electricity?”
Hughes continued:
Last September, the province announced plans to offer leases for five gigawatts of offshore wind energy by 2030. The first call for bids will be in 2025, a year before EverWind plans to ramp up its ammonia production to one million tonnes a year.
In a media release at that time, Premier Houston said that, “Setting this [five gigawatt] target sends a clear signal to the world that Nova Scotia is open for business and becoming an international leader in offshore wind and green hydrogen development”.
The premier’s announcement failed to mention how his vision of Nova Scotia being a leader in green hydrogen will be integrated into the non-existent provincial energy strategy. Without that, the EverWind project risks becoming one of a historic string of expensive industrial project failures in the province.
Hydrogen ‘distracting from important decisions’
The Examiner also questioned Brenna Walsh, Senior Energy Coordinator at the Ecology Action Centre, about the hydrogen rush in Nova Scotia.
Asked whether she thought it possible to justify the use of vast amounts of renewable energy for the production of millions of tonnes of green hydrogen and ammonia for export, when Nova Scotia doesn’t even have enough renewable energy for its own domestic needs, Walsh replied:
The simple answer to your question is no. It seems very difficult to justify a project which will use such significant amounts of land in Nova Scotia to build wind farms which will not be used to green our own grid. We have repeatedly called on the province to do a comprehensive crown land use planning study to evaluate which land would be important to preserve as part of our commitment to get to 20% protected land by 2030, which land is of biological significance and provides important habitats for at risk species, or serves as important carbon sinks like wetlands, which is currently being used for other purposes such as forestry, and which have cultural significance and using this make recommendations as to which land may cause minimal impact if selected for placement of wind farms.
Walsh noted that Nova Scotia has to get off coal by 2030. But additionally, she said, it will need to double or triple the capacity of the provincial grid to accommodate the switch from heating with fossil fuels to heat pumps requiring electricity to meet goals of getting to net-zero by 2050. The transition to electric vehicles will also add load to the grid, Walsh added.
“Therefore, we need to carefully plan where it will be best to place wind farms in Nova Scotia, as we will have to add significant renewable capacity,” Walsh said. She thinks the focus should be on the Atlantic Loop, to smooth out peaks in load on the grid, and on adding grid-scale batteries for additional backup and more reliable, affordable power as more renewables are added.
“These, as well as increasing efficiency in our buildings should be the focus in our transition,” according to Walsh.
She concluded:
I worry that the emphasis on the large hydrogen projects for export is distracting from important decisions that need to be made in terms of where the renewables which we need to power our grid today and into the future will be best placed, in addition to the potential ecological impacts to the land where the large onshore wind farms associated with the projects will be built.
Endnotes
[1] Engineer and Senior Contributor to Bloomberg NEF Michael Liebreich has written extensively on the hype and hyperbole surrounding green hydrogen and ammonia, as well as their actual potential in efforts to transition away from fossil fuels to combat the climate crisis. He was also recently featured in Markham Hyslop’s “Energi Talks” podcast, in which he explains why hydrogen is not the silver bullet many hydrogen proponents claim it is.
[2] The questions the Halifax Examiner sent to Bear Head Energy on April 14 and then again on April 18, 2023, were:
- On your website, you say “We plan to produce green hydrogen & ammonia at scale” and that your facility is “In proximity to abundant wind, tidal, and hydro power.” To produce green hydrogen, all the electricity used in its production must be from renewable sources. Where exactly (which sources and how much from each) will the electricity for your hydrogen production come from?
- You also say on your website that Bear Head Energy a “Fully permitted green hydrogen and ammonia site, resulting in a significant advantage for expeditious clean energy project development” … what exactly is meant here by “clean energy project development”? Elsewhere on the website you also refer to this being a “world scale clean energy project.” Are you planning to produce green hydrogen and ammonia from 100% renewable energy sources, or hydrogen of another “colour” using energy from natural gas, which is sometimes also called “clean” hydrogen?
- In your February 2023 Registration document with Nova Scotia Environment and Climate Change, you say that at “full build-out,” you will be producing 2 million tonnes a year of green ammonia using “renewable energy.” How much energy will it take to produce 2 million tonnes of green ammonia? Where do you foresee this energy coming from? Will your production depend entirely on the availability of energy from renewables?
- Do you plan to use any energy at any stage from the Nova Scotia Power grid? If so, how much and when?
- Nova Scotia Power has just been fined $10 million for missing its renewable electricity targets transition, and it still depends heavily on coal to supply the provincial grid for a variety of reasons, including the problems with the hydro from Muskrat Falls and also because there are not enough renewable energy sources yet available in the province. Given the imperative for Nova Scotians to transition to renewable energy sources for domestic use in the province (by 2030 80% of its electricity is to come from renewables), how would you justify to Nova Scotians your use of scarce renewable energy sources for this project to produce green hydrogen and ammonia?
There’s an excellent read on how Nova Scotia gets into, and out of, these net-loss investment scams – Failures and Fiascos: Atlantic Canada’s Biggest Boondoggles.
https://books.google.ca/books/about/Failures_and_Fiascos.html?id=IAP6ngEACAAJ&redir_esc=y
Someone start taking notes now so we can add green hydrogen to a second edition.
Dr. Hughes hit the nail on the head. To have green hydrogen you basically have to have excess energy on the grid specifically dedicated to creating and using hydrogen (basically as a form of energy storage). To have a truly sustainable hydrogen infrastructure an area needs a highly decentralized system in which then can ensure dirty energy is never used in the creation of the Hydrogen. NS does not have and won’t soon have enough excess energy in the system in need of storage (as hydrogen) nor does it have an infrastructure to use the produced hydrogen as energy for transportation or power production. Exporting it across the world using ships run on OIL is asinine. These current proposals are out of step and as long as we’re leaving this up to for profit entities to guide we will not have a well planned system specifically designed to serve the needs of the public. The province needs to develop longer term visions and plans for what it wants the energy grid to look like instead of these piecemeal hap hazard bumps and starts.
This is now a 100 year old idea.
“Personally, I think that four hundred years hence the power question in England may be solved somewhat as follows: The country will be covered with rows of metallic windmills working electric motors which in their turn supply current at a very high voltage to great electric mains. At suitable distances, there will be great power stations where during windy weather the surplus power will be used for the electrolytic decomposition of water into oxygen and hydrogen. These gasses will be liquefied, and stored in vast vacuum jacketed reservoirs, probably sunk in the ground. If these reservoirs are sufficiently large, the loss of liquid due to leakage inwards of heat will not be great; thus the proportion evaporating daily from a reservoir 100 yards square by 60 feet deep would not be 1/1000 of that lost from a tank measuring two feet each way. In times of calm, the gasses will be recombined in explosion motors working dynamos which produce electrical energy once more, or more probably in oxidation cells. Liquid hydrogen is weight for weight the most efficient known method of storing energy, as it gives about three times as much heat per pound as petrol. On the other hand it is very light, and bulk for bulk has only one third of the efficiency of petrol. This will not, however, detract from its use in aeroplanes, where weight is more important than bulk. These huge reservoirs of liquified gasses will enable wind energy to be stored, so that it can be expended for industry, transportation, heating and lighting, as desired. The initial costs will be very considerable, but the running expenses less than those of our present system. Among its more obvious advantages will be the fact that energy will be as cheap in one part of the country as another, so that industry will be greatly decentralized;” J.B.S. Haldane 1923