MICHELE FOSSI – “It’s 2050, and the world is set to feel the first refreshing effects of global cooling. Temperatures have stabilised — rainforests and reefs thrive. We can trade, prosper and travel while respecting the delicate equilibrium of our planet. When we take a long-haul flight, or turn up the heating we are using clean energy. Ships, buses and cars no longer spew toxic fumes and CO₂, but pure water. The pipes leading into our homes carry gas derived from recycled waste or renewables. We are harnessing the power of the wind and sun — transformed into Hydrogen.” Does this reassuring prophecy ring any bells?
MARCO ALVERÀ – (Laughs) It does! It’s an excerpt from my first book, Generation H. I’m now using my time at home during lockdown to write two other books on the same topic, including one for children. The interest around Hydrogen is growing very fast.
M.F. – These ideas of a green future seem more akin to the likes of Greenpeace or Jeremy Rifkin. How is it that the CEO of Snam, Europe’s largest gas infrastructure company, has arrived at this conclusion?
M.A. – Hydrogen presents a huge opportunity, both for Snam and the world. Some might think I am pushing this agenda because I’m afraid that the alternative — to go all-electric — could harm our business. We should all remember that you can only electrify so much of our economy — a percentage that is estimated around 40-50% to 2050. So we need to think of other carbon-free energy sources besides clean electricity if we want to reach the goal of net-zero CO₂ emissions by 2050.
M.F. – So, where can we ensure the remaining 50-60% if we want to divest from fossil fuels entirely?
M.A. – That’s still an open question. No one’s talking about how to substitute our coal, oil and natural gas dependency for heavy industries today. Bill Gates — who’s also a big Hydrogen advocate — says, “whenever people come and talk to me about the energy transition, I always ask them the same question; what’s your solution for steel?” Experts predict that we’ll have millions of new city dwellers in the next 30 years. Cities are made of steel — and you cannot reproduce steel, and likewise fuel large sectors of the industry entirely with electricity.
M.F. – So, what do you propose?
M.A. – In my book, Generation H, I explain why I think that Hydrogen is the solution to achieving carbon-free, clean steel production while solving many other older problems that remain unresolved today.
M.F. – Like what?
M.A.. – Think of the problem of the seasonality in energy consumption — which today is considered one of the biggest impediments to the development of renewable energies. In many areas of the world, such as continental Europe and North America, there is a massive shift in energy consumption between summer and winter months. Because of heating, cities like Berlin or Milan consume something like six times more energy in the winter than in the summer. As of today, there’s no way you can replace natural gas with renewable electricity. You cannot use a battery that you charge on the 5th of June to heat your home on the 15th of December.
M.F. – But can Hydrogen do the trick?
M.A. – Yes. And precisely because I have this vision, I would like to turn the energy company I work for into the world champion of Hydrogen. And Biomethane — which is CO₂-neutral Methane obtained from organic and agricultural waste, too.
M.F. – Methane, Hydrogen… Before we go on with the conversation, let´s quickly outline the chemical properties of these two gases. Methane: we combust Methane to produce energy. Methane is considered cleaner than oil because when burned, it produces only CO₂ — sparing our cities of toxic smog. However, for the very same reason, it contributes to climate change. Hydrogen: when combusted, you get energy too. However, instead of producing CO₂ as a side product, you get pure water! Too bad Hydrogen does not exist as a naturally-occurring gas on planet Earth. We have to produce it ourselves from water.
M.A. – It’s true. Hydrogen is hardly present in its gas state on Earth. But because there’s a lot of water on this planet, there’s also plenty of Hydrogen. We just need to decide to go and get it.
M.F. – To divide water into Oxygen and Hydrogen, we need to provide energy. Depending on which source of energy we use — ‘dirty’ coal or clean, renewable solar or wind energy — some ways of Hydrogen production are cleaner than others. So-called ‘grey Hydrogen’ is obtained by combusting coal as a source of energy to divide water, which makes it overall ‘dirty’ because it’s production is linked to CO₂ emissions. A cleaner option is ‘blue Hydrogen’, this being Hydrogen produced from coal or other fossil fuels, but where you capture and store the CO₂ before it is released in the atmosphere. Last but not least, we have ‘green Hydrogen’ — Hydrogen produced from solar, wind or other renewable energy sources. What is the percentage of green Hydrogen today, compared to the others?
M.A. – As of today, it is still quite low, unfortunately. Almost all of the Hydrogen in circulation is grey. But still, with the use of grey Hydrogen, we are paving the way for the arrival of clean, green Hydrogen — hopefully soon. By testing with grey Hydrogen, we are refining the way we store, transport and get deeper insights on how to make use of Hydrogen in general. And also how to sell it.
M.F. – But why don’t we start with green Hydrogen?
M.A. – In the absence of a CO₂ tax, there’s no incentive to go green — green Hydrogen is still more expensive to produce than the grey. But in five years we could reach the tipping point over which the first will be cheaper than the latter. To accelerate the transition to green Hydrogen, governments could consider subsidizing it with incentives.
M.F. – Grey, blue and green. Are there other colours for Hydrogen?
M.A. – You also have ‘pink Hydrogen’ — Hydrogen made from nuclear energy. And there’s ‘turquoise Hydrogen’, obtained from pyrolysis. Similarly to blue Hydrogen, in the production process for turquoise, the carbon is stored in solid form and prevented from contaminating the atmosphere. Except for grey, I support all these different ‘coloured’ types of Hydrogen, as long as we can keep the CO₂ involved in the ground. Let’s always remember that carbon, per se, is not harmful. We’re made of carbon. Trees grow with carbon; carbon feeds plants. We eat carbon at every meal or drink it when we order a beer.
M.F. – Even a girl’s best friend — diamonds — are made of carbon.
M.A. – Yes, even diamonds! Carbon is ‘bad’ for the environment only when it is released into the atmosphere in the form of CO₂, as it absorbs heat and contributes to the heating of the planet. But if we can capture it during the process, we are left with a solid byproduct that we can use to build many objects, from tennis rackets to skis. I even like pink Hydrogen: if you’re in Japan and you have a lot of nuclear energy at your disposal, pink Hydrogen is a cool way to employ it.
M.F. – I’ve heard about the many qualities of this clean fuel since I was a child. In your book, I found the idea of using a Hydrogen engine was already foreseen by Jules Vernes back then! In 1874 Vernes wrote, “I believe that water will one day be employed as fuel, that Hydrogen and oxygen which constitute it, used singly or together, will furnish an inexhaustible source of heat and light, of an intensity of which coal is not capable”. So if the idea of Hydrogen as a fuel is not new, what makes you so confident it will suddenly be adopted by humanity in the next few years?
M.A. – Many scientists of the past — starting from Jules Vernes, who was a scientist besides being a novelist, and Alessandro Volta, the inventor of the first battery — were convinced that Hydrogen, being both flammable and largely available, was the solution for humanity’s quest of energy.
M.F. – But then oil came in the way.
M.A. – In the 1930s, in order to overtake Germany, Churchill converted the British fleet from coal to oil — a decision that historians consider marks the beginning of the oil industry revolution. After the War, oil became so cheap that Hydrogen, for mere cost reasons, was put on the side. Oil is cheap because our society does not acknowledge its real value. When we burn a litre of oil in our car, we are consuming a liquid that has taken nature millions of years to produce, and is not renewable. It should cost far more than a dollar or two.
M.F. – In the early 2000s, in the wake of growing concern for climate change, Hydrogen re-entered the debate for environmental reasons, as a cleaner substitute for fossil fuels.
M.A. – Correct. In 2002, when I was working for an Italian electricity company, I attended a global conference on Hydrogen. In those years Hydrogen was mostly considered to be a vector to bring nuclear energy into cars. Japan, in particular, was pushing its automotive industry in this direction. Renewables were still very expensive at the time: solar energy cost 100 times more than oil. The reason why I got so excited about Hydrogen, to the point of writing a book and deciding to turn Snam into a Hydrogen leader is that, in the course of the past 10 years, the price of solar energy has fallen by 30 times. For the first time in history, the idea of producing Hydrogen by splitting water with solar energy became suddenly economically feasible. And looking forward four or five years, I am pretty confident that we will be able to make Hydrogen from the sun at the same cost of oil.
M.F. – In the book, you explain that producing Hydrogen in the desert from solar energy would solve an old problem, transporting the renewable energy produced there over long distances, to wherever it is needed.
M.A. – Hydrogen is a fantastic connector. It will connect energy sectors that are totally separated today.
M.F. – How?
M.A. – When you generate Hydrogen from the sun, you are creating energy in the form of a gas, which means you finally have a way to transport it over great distances. Due to dissipation effects, this has never been the case with electricity, which cannot be transported over long distances without losing power. On the contrary, gas can travel for longer distances with minimal energy loss.
M.F. – So, if we convert electricity into Hydrogen, we suddenly have an efficient way to produce enormous amounts of solar energy in the Sahara, and subsequently, move it to continental Europe through Italy. Or to generate wind energy in the North Sea, and then efficiently transport it in the form of Hydrogen to Sicily.
M.A. – Yes! By converting electricity into Hydrogen right where it is produced, you get to solve another old problem of renewable energy; its storage. Electricity is not only expensive to transport, but even more to store. Batteries, as we all know from our experience with mobile phones, may well be cheaper today, but they are still not that performative.
M.F. – In the past months, Snam successfully tested the feasibility of adding 10% Hydrogen to the Methane transported in the company’s pipelines.
M.A. – These are such great results! Not only have we shown to the world that you can use the already existing gas infrastructure, but that we can burn Hydrogen together with Methane, without changing anything in the hardware. Last December, we increased the percentage of Hydrogen to 10% and, again it worked just fine. These results mean we have suddenly found a way to introduce non-electric, renewable energy into factories, at no cost.
M.F. – So Hydrogen is the Trojan horse with which we can hope to inject also the so-called ‘stubborn’ sectors of the industry — the most reluctant to embrace the energy transition — with renewable energy.
M.A. – Yes. The industry of steel, as I mentioned earlier, is only one of the many. And imagine if we did the same for heating our homes!
M.F. – Explain how Hydrogen could play a role in heating our homes.
M.A. – What are your choices if you wish to heat your apartment with renewable energy? A first option — and a very expensive one — is that you install electric heating. The other is that you keep the same boiler, the same radiators and the same pipelines, and start using a mix of Methane and Hydrogen, powering your home with clean energy for heating and cooking, at no extra cost.
M.F. – Do you have a specific time frame in mind? When do you think we will be ready to transition to Hydrogen? How far is this goal?
M.A. – I am confident that the European Union will use The Green Deal as a sort of Marshall Plan to help Europe restart and rebuild itself. As we aim to restart Europe after this crisis, we need to do it in a future-proof way. We need to equip ourselves with the technologies that will allow us to have clean air as that we breathed in Milan during these days of lockdown. Can you believe that, for the first time, I can see buildings I had never been able to see before?
M.F. – Is Hydrogen playing any role in the plan for decarbonising Europe?
M.A. – We have calculated that by equipping just about 1% of the Sahara’s surface with solar parks for green Hydrogen production, it would be enough to meet all of Europe’s energy needs! In practice, the plan is to meet, with Hydrogen, between 25 and 30 per cent of Europe’s energy demand and to provide the remaining 50% with renewable electricity and the rest with Biomethane, produced from waste.
M.F. – What would be the geopolitical consequences of a massive shift from oil to Hydrogen? Would it destabilise the planet?
M.A. – Quite the contrary. Being a fair gas that can be produced virtually everywhere from sun and seawater, Hydrogen will soothe many geopolitical tensions. For the first time, emerging countries such as Ethiopia and Somalia will have the opportunity to become energy producers. The sunnier parts of the world, which also happen to be the poorest, will gain a lot from this energy transition because they will finally be able to export solar energy. Globally, Hydrogen will create lots of jobs too.
M.F. – Last September, writer Jonathan Franzen wrote a controversial article in The New Yorker titled What if we stopped pretending, where he writes, “the struggle to rein in the global carbon emission and keep the planet from melting down has the fuel of Kafka’s fiction. The goal has been clear for thirty years, and despite earnest efforts, we’ve made essentially no progress towards reaching it”. By realistically accepting that we won’t meet the climate goals and that the temperature increase will be most likely higher than 2°C, he argues, we might be more efficient in finding ways to mitigate the effects of climate change. What’s your response to Franzen?
M.A. – Reading that article put me in a bad mood for a week. I kept receiving it forwarded from my friends. A week later, I prepared a written answer for them, in which I explained why I could not agree. On the one hand, we indeed need to start thinking about mitigation, because we are still way off the trajectory that we’d need to be on to stay within two degrees increase. However, we need to keep on working very hard to keep it between two and three degrees. We need to believe that we will make it and work hard for this goal. There is no room for defeat here. The cost of doing nothing is just too high.
M.F. – Too bad we are all concerned more about the virus than the climate during this period.
M.A. – Yes, but after the virus, the number one problem in the world will be climate change again, and how we respond to that — Hydrogen represents a massive solution.
M.F. – But how safe would it be to introduce this highly flammable gas in our daily life, be it in our homes or our cars? I’m thinking of the explosion of a Hydrogen-gas plant in Norway in June 2019.
M.A. – Look, every energy source has its safety concerns. Think of electricity, how many people get electrocuted in the world every year? Toyota — the world’s biggest carmaker, and one that is betting everything on Hydrogen — has done a test to show how safe their Hydrogen car, Mirai, is. They first filled up all its tanks, and then threw it off the tenth floor of a parking lot. The car crashed and didn’t explode. Then they took a machine gun and started firing at the car — still, no explosion.
M.F. – How come?
M.A. – It’s the lightest gas of the universe. In case of a leak, it flies away very fast, thus making the actual risk of explosions very low.
M.F. – In October 2017, you delivered a TED talk about Fairness in the work environment, that collected 3 million views and in which you explain why, for a company, treating the employees fairly pays off, at all levels. It’s worth remembering here that Snam, under your guide, has been nominated by Forbes as one of the best 150 companies to work for in the world last October.
M.A. – Science has highlighted how detrimental unfairness can be. When you have an unfair boss, the psychological response in the employee is so negative, that no bonus can help — they just disengage and stop performing. When you feel the victim of an unfair boss, the same part of the brain lights up as when you experience physical pain.
M.F. – So social pain and the physical pain are — at a neurological level — identical.
M.A. – Yes! And this has a terrible overall impact on the global economy. It is estimated that unfairness at work costs the US economy 550 billion dollars every year, due to the disengagement and loss of participation it causes in employees. The good news is that when you are fair, magical things happen. People relax, and when they are relaxed, they dare to express their opinion or come up with their own solutions to a problem. When ideas circulate freely, the company thrives. It’s like with jazz; you get the best jazz music when musicians improvise.
M.F. – How did you develop these beliefs?
M.A. – My very first work environment in a global financial services company was extremely competitive — if you did well, you got a big bonus; differently, you got fired. A few years later, when I moved to a large Italian state-owned energy company, I was assigned a large team of people to manage. Although I did not have a budget for bonuses, the team worked just great. So I asked myself, “can it be that the high performance of this team is related to the work environment being uncompetitive?”. This intuition urged me to talk to neuroscientists, psychologists and headhunters. What I discovered, somewhat not surprisingly, is that what motivates people at work is far more than money or fear, having a ‘purpose’ in what they do. But fairness goes beyond the workplace. Today more than ever, social commitment and having a social purpose is ever more important. Individuals, and companies, have a moral duty to help others. That’s why, with my brother, in our free time, we started Fondazione Kenta, a non-profit organization that pays homage to our grandmother, Kenta Alverà, who was a writer and an activist for women’s rights. Today, the foundation is active in the neighbourhood where it stands – Milan’s Isola – where it promotes initiatives to help the local community. And that also includes helping girls in local schools to discover their purpose and pursue it.
M.F. – Do you anticipate Hydrogen, besides becoming the future of energy and delivering on environmental targets, will also serve as a great sense of purpose for Snam’s employees?
M.A. – If a company can discover a superior purpose than just profit-making, it is a strong company. In Snam, we believe that Hydrogen can help us become a leader in the energy transition, which is one of the ways through which we want to contribute to the world.