The British Columbia (BC) government has released a hydrogen strategy to scale up production of both the green and blue varieties in the province, promote local hydrogen hubs and consumption, and ultimately establish a thriving low-carbon hydrogen export industry.

The strategy commits to ramping up financial incentives and direct support to promote investment in the BC’s fledgling hydrogen industry, outlining 63 actions to be undertaken by the provincial government over the short (2020-25), medium (2025-30) and long (2030-50) term.

63 – Strategic actions to be undertaken by provincial government

“This is the first comprehensive hydrogen strategy of any province in Canada,” David Layzell, co-founder and energy systems architect at Canadian not-for-profit The Transition Accelerator, , tells Hydrogen Economist. “Other provinces, such as Alberta, have released roadmaps or background papers to promote hydrogen in their provinces, but BC has now provided steps and targets.”

The key short-term actions by the BC government will be on the regulatory front, the strategy says. “Many regulatory changes are needed to lay the foundation for a successful hydrogen industry in the province,” says Duncan McPherson, a partner at Bennett Jones, an international law firm based in Calgary.

“The two most important changes are regulations to allow carbon capture and storage to open the door for blue hydrogen production in the province, and regulations to provide water rights to green hydrogen projects since electrolysers need a lot of water.”

To support greater consumption of low-carbon hydrogen in BC, the strategy states the province will consider expanding incentives under the Zero-Emission Vehicles Act (ZEVA) from light-duty vehicles (LDVs) to medium- and heavy-duty ones. “I’m very supportive of the BC government expanding ZEVA to heavier transport, since these vehicles require a relatively small number of fuelling stations,” says Layzell. “In contrast, I am less supportive of the original focus of this programme. Battery electric vehicles (BEVs) tend to be substantially more economic for LDV than hydrogen fuel cell-powered ones.”

Export potential

BC may be blessed with abundant hydro and wind resources for the production of green hydrogen, but that does not mean it can economically produce it for future export markets—a fact the province acknowledges in its strategy. BC Hydro rates are too high to make cost-effective green hydrogen, even with discounts under its discounted Clean Industry and Innovation Rate.

As a result, the strategy suggests “alternative electricity rate designs” might be adopted sometime in the 2025-30 period to support green hydrogen producers in BC. Layzell says its “very possible” that price subsidies such as these could in the future lead to trade actions by countries with their own plans for low-carbon hydrogen production, such as the US.

“The two most important changes are regulations to allow carbon capture and storage to open the door for blue hydrogen production in the province, and regulations to provide water rights to green hydrogen projects since electrolysers need a lot of water” McPherson, Bennett Jones

“On a more fundamental basis, the question to ask is whether hydropower should even be used to produce green hydrogen in BC, especially since it takes a lot of power to produce,” says Layzell. “It may be better used powering BEVs, and the greater electrification of the economy as a whole, to achieve net zero.”  

On the other hand, Layzell and McPherson both agree BC has world-class natural gas reserves and geological storage potential and, over time, should be able to produce huge amounts of blue hydrogen for the provincial and export markets.

“At the same time, BC—and the same goes for Alberta and Quebec— will be able to leverage existing infrastructure to ship low-carbon hydrogen to international markets,” McPherson tells Hydrogen Economist. “The pipelines and rail and ports provide these provinces with a great advantage. Vancouver and Montreal are Canada’s two largest port cities.”

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Author: Vincent Lauerman