Nice names like Katrina, Rita and Stan are now associated with three different facts:

1. the climate change is perceived to be , well underway, the increasing numbers of disastrous hurricanes in the Caribic being one of its manifestations

2. the most vulnerable technical systems are - and will most likely also be in the future - oil platforms and large parts of the US oil refineries

3. oil prices will therefore climb earlier and reach much higher levels than expected, heralding the imminent decline of the era of black gold

Now is the right time to act globally.

Is there a chance to escape the inevitable repercussions of this decline? Yes there is, but the escape route is different from what we thought before.

Practically all industrial nations depend heavily on oil as energy source. Although visions and concepts exist of what our life would be without it, it is impossible to substitute it in the short term. Surprisingly, the global view of an environmentalist on our energy future does not differ much from that of a realistic engineer: hydrogen economy being the magic word. However, whereas the environmentalist envisages the global era of hydrogen production based on renewables only, the engineer, more familiar with the current efficiency figures of technical systems available maintains that renewables (solar, wind and biomass) will only be able to play a niche role in the future.

What can be done in the near future and who can do what?

Large scale substitution of oil by hydrogen would imply abandoning the corresponding infrastructure and building up the appropriate new one. This is a very costly process and experience shows that depending on the market penetration of the old technology, it may take several decades. If the transition to a hydrogen economy proves to be at all a viable proposition, the author ventures two assertions:

First: large industrial nations will go through a slow shift from oil to hydrogen economy and will depend on oil imports for another four to six decades.

Second: by contrast, smaller industrial nations depending on oil imports will have the opportunity to complete the transition earlier, let’s say within two decades, but only in specific sectors of their energy consumption.

Using rather simple arguments, it can be shown that smaller countries thanks to a few distinct economic features have a chance to start the transition earlier. The characteristic features of those countries are:

• highly industrialized

• prospering small and medium sized enterprises

• less than 10 million inhabitants

• good university education

• high standard of living

• being a small country

Oil and gas consumption for private, public and industrial heating purposes should be a considerable part of primary energy import and production. Examples are countries like Austria, Belgium, Denmark, Latvia, Slovakia, Switzerland etc.

The sector of energy consumption which should be converted to hydrogen economy first is energy for heating.

How can that goal be reached?

The technological path into this future comprises three areas:

Heat production, transportation technology for hydrogen and hydrogen production.

The transition programs to be started by these countries are more or less similar.

In the area of heat production existing oil and gas burners will be replaced by stationary fuel cells. Stationary fuel cells are more advanced in their development compared to fuel cells for transport purposes. They are already on the market and their improvement is being carried out.

These fuel cells are dual purpose cells since they produce both electricity and heat. Heat is needed for households or buildings, whereas the electricity produced is fed into the electrical grid, thus forming at the end of the fuel cell installation program a certain part of decentralised energy production. A very welcome by-product of this technology is that due to the growing number of installed fuel cells the need for daily expensive peak power will decrease, because the decentralised power producers will smooth the grid loads signifi-cantly.

The electricity produced by the fuel cells could be used instead to feed into the grid, too, for local hydrogen production. The decision will depend on detailed economic calculations according to an energy master plan of the individual country.

This area of the whole hydrogen economy booster program will pose neither intellectual nor technical problems to the countries.

As far as transportation and storage of fuel for the stationary fuel cells is concerned, viz., two different kinds of transportation have to be developed. On the one hand existing natural gas distribution pipelines will continue operation for a certain time with natural gas and later on they will be used to transport H₂, when the scale of hydrogen production has increased. Starting fuel cell operation with natural gas is only a question of extending CO₂ emission. This should be for a limited period only.

On the other hand fuel cells not connected to the gas pipeline must be fed by hydrogen and transported to the end-users by bowers.
Development of infrastructure is needed in this area. Fortunately, current development in transport of H₂ by trucks can be used for storage purposes, too. The most promising technology is the metal hydrate technology, although considerable effort is still required. It might take 5 to 10 years before the technology has reached market maturity.

The remaining third area of the total program is the industrial production of hydrogen.

Where will hydrogen come from?

To answer this question one has to look at the technologies offered on the market, promising the highest efficiency. As mentioned before, renewable energy sources are not seriously considered to produce hydrogen, since the territories of the countries will be too small to harvest electricity from wind, sun and biomass in the amounts required.

The only other reliable, sustainable and environmentally benign technology is via process heat production by nuclear High Temperature Reactors. The market has promised these inherently safe reactors to be mature within one decade. This sounds credible.
Even chemical processes required for cheap hydrogen production are available and based on well known chemistry. Electrolysis is not necessarily the best process due to its inefficiency. For improved efficiency the chemical processes need HTR’s producing heat only.

A period of 10 to 15 years to switch from oil and gas economy to the hydrogen economy is sufficient for heating purposes.

Since the small counties do not produce in most cases their own cars or have their own oil refineries for gasoline production, they are totally dependent on the global market for incorporating energy consumption for transportation into their own hydrogen economy conversion program. And this conversion will take more time than the replacement of oil/gas by hydrogen.

At the end of the first conversion period, the countries following this path and creating partly an hydrogen economy will certainly have spent a lot of money.

But what will they gain?

1. An enormous impetus onto their economy of manufacturing and installing fuel cells and development programs as well.

2. Substitution of oil/gas by hydrogen for heating purposes

3. Production prices for the energy carrier hydrogen below those for oil and gas in the future

4. A considerable part of energy consumption has become environmentally benign

5. A knowledge base with a head start marketable to the late arrivers

6. Meeting Kyoto Protocol’s commitments

7. Improving acceptance of nuclear energy

The investors and financial side of the story

The three different technological areas for the transition to hydrogen economy in the heating energy sector will need three different financing models.

The consumption of H₂ has to be subsidized, too, by public hand. The principle should be that the difference between H₂ and oil/gas should be off-set by the government. In order to keep the management of this kind of financing easy, it can be regulated via the amount of electricity produced by the fuel cells and fed into the grid.

As far as H₂ transportation and storage is concerned, further developments of the metal hydrate storage technology applicable for transportation and storage should be carried out by government funded research institutions and university, in the countries which have already started developing this technology. When maturity is achieved, there will be sufficient entrepreneurs investing in the H₂-bowser fleet as well as into the stationary H₂-storages.

Other countries with no own development program in this area have to wait until the metal hydrate storage technology is on the market.

For the remaining third technology area, hydrogen production, there is no financing model needed because the HTRs and chemical high temperature hydrogen production are well proven technologies. Their combination does not impose financing problems onto the booster and transition program for the hydrogen economy.

If the country has already nuclear power capacities, it will remarkably facilitate and accelerate the transition to hydrogen economy. Indeed the knowledge of how to operate nuclear reactors exists already and nuclear technology is already accepted.