Will Water Demand Restrain Hydrogen Ambitions in the Caspian Sea?

Green hydrogen, produced through renewable energy-powered electrolysis of water, is seen as a pivotal driver of the global energy transition. By enabling the utilization, storage and long-distance transportation of renewable energy—whether as gaseous hydrogen or ammonia—green hydrogen provides a viable
pathway to decarbonize hard-to-abate sectors, such as heavy industry and long-haul transportation (IEA, 2023).

The Caspian region, particularly the vast undeveloped lands to the east of the Caspian Sea offers immense potential for renewable energy and hydrogen projects. This area combines exceptional solar and wind resources with access to the low-salinity waters of the Caspian Sea, making it an ideal location for giga- scale hydrogen production. Having the potential to generate hundreds of gigawatts of green hydrogen and ammonia, the region is well-positioned to become a major supplier of green energy to the EU and global markets. The prospective export routes across the Caspian Sea and through the South Caucasus could position Central Asia as an emerging pivotal hub for supply of low carbon hydrogen and its derivatives, competing with Australia, the Middle East and North Africa, or South America. Giga-scale green hydrogen initiatives in Kazakhstan and potentially Turkmenistan are already attracting significant from developers interest. For example, the Kazakhstan’s flagship green hydrogen project, Hyrasia One project, Mangystau region (Fig.1), spearheaded by the German-Swedish company Svevind and supported by the EU.

It aims to construct 40 GW of wind and solar capacity to produce and export by 2032 up to 2 million tons of green hydrogen or 11 million tons of green ammonia 1 annually. Development of the first 2 GW phase is underway, accompanied by a comprehensive Environmental and Social Impact Assessment (ESIA) to evaluate potential environmental impacts of the project. Meanwhile, experts emphasize that Hyrasia One must address significant concerns over water use, as it plans to extract substantial amounts of water in an already water-stressed region. Balancing the project’s ambitions with local ecological sustainability and general water management by water-scarce Kazakhstan is critical to its viability and acceptance.

However the hydrogen projects should be considered in the context of other activities in the Caspian basin that further exacerbate stress on its water levels and aquatic ecosystems. The damming and overuse of the Volga River, the sea’s primary freshwater source, are indicated as key contributors to declining levels.
Additionally, water extraction for desalination for agriculture, and infrastructure development severely harms ecosystems and worsen pollution, destabilizing the region’s environmental balance. Tackling these challenges and balancing competing demands for agriculture, human consumption, and industry requires
coordination among littoral states. Comprehensive regional environmental impact assessments are crucial to evaluate and coordinate large-scale water use initiatives.

Meanwhile, environmental concerns risk eroding political and policy support for hydrogen projects in Central Asia, further delaying the development of hydrogen value chains, which already face long lead times. These concerns could also shift focus away from more significant factors impacting Caspian Sea levels, such as climate change and extensive water diversions for agriculture, industry, and human consumption. In this note, we try to examine the relative importance of the impact on water use of hydrogen production, compared to other factors. We argue that the expected water use by hydrogen projects like Hyrasia Oneis negligible compared to the effects of climate change and water diversion for agricultural and industrial uses. Thus we suggest that water availability should not be a primary restrictive factor in policy dialogue over hydrogen production in the Caspian basin.

Picture Source: Vecteezy.com

Water Requirements for Hydrogen and Conversion Production

Water is an essential resource for the electrolysis process in hydrogen production and plays a vital role in associated technological applications, such as equipment cooling and ammonia synthesis from hydrogen. When seawater is used, desalination is required before it can be incorporated into these processes. This step increases overall water demand, although part of the processed water is returned to the environment as high-salinity brine. Below are some key metrics for water demand in hydrogen and ammonia production: 

•  The core chemical process of electrolysis requires 9 liters of high-purity water to produce one kilogram of hydrogen.
• Technological needs, predominantly for equipment cooling, significantly increase water consumption. According to (IRENA, 2023) Alkaline electrolyzers (see below) consume approximately 22.3 liters of fresh water while Proton Exchange Membrane (PEM) electrolyzers require slightly less – around 17.5 liters per kilogram of hydrogen.
• In case of seawater use, water extraction largely increases and reaches 83 liters of seawater for one kilogram of hydrogen produced. Of this, 59 liters are returned to the sea as high-salinity brine, resulting in a net consumption of 24 liters per kilogram of hydrogen.
•  Ammonia synthesis introduces an additional step in the technological process, but its water requirement does not add significantly to the above numbers. The Power-to-X study for Tunisia concludes that the extra water needed for ammonia production is negligible relative to the water demands for hydrogen generation.

Thus, industry estimates suggest the net consumption of water from the Caspian Sea to be close to or below 25 liters per kilogram of green hydrogen. This aligns well with the projection from the Hyrasia One project, which forecasts an annual net water withdrawal of 50 million cubic meters at the full operational capacity (2mln tons of H 2 ), based on advanced engineering solutions for desalination, electrolysis, and cooling. Based on this estimate, we examine the effect of such water diversion on the Caspian Sea level.

”Concerns over water availability should not hinder policy dialogue on giga-scale hydrogen development in the Caspian region, as its impact on sea levels is minimal compared to other natural or man-made factors”

Effect of Hydrogen Production on Caspian Sea Levels

The Caspian Sea level has experienced significant fluctuations over time. According to Encyclopedia Britannica, the Caspian’s levels have varied by 7 meters over the past two millennia, with a 3-meter fluctuation in the 20th century alone. Dam construction, particularly reservoirs on the Volga River in last century, has significantly altered its natural flow, with estimates suggesting a reduction of up to 15% in water reaching the Caspian Sea. This reduction, combined with other factors like evaporation from reservoirs, underscores the critical impact of hydrological modifications on the Caspian’s declining water levels.

More recently, satellite data from NASA show a 1.5-meter drop in sea level since 2006, with an average annual decline of 23.3 cm over the past three years. Climate modeling study indicates that the rapid decline is caused by increased evaporation due to climate climate-induced change in wind regimes. In intermediate and pessimistic scenarios of climate change, Caspian levels could fall respectively by 9 meters or by18 meters. This would result in water surface area loss of 34% by the end of the century and will have a huge impact on the Caspian Sea ecosystems by drying out of the vast territories of the Northern Shelf and South-East of Caspian. The situation can be further aggravated by further changes in water discharge from dams on the Volga River and the planned water desalination projects of littoral states.

By Comparison the Hyrasia One project’s anticipated water usage of 50 million cubic meters represents only 0.016% of the Caspian’s annual water inflow and 0.02% of the Volga River’s contribution (250 km³ annually). This usage would translate to a one-time sea level decrease of just 0.14 mm or 0.06% of the current observed level drop of 23.3cm. Even five projects of this size would represent only 0.3% of the observed annual level decline. Thus, projects like Hyrasia One are much less significant potential contributors to Caspian Sea level variations compared to climate change, weather, or water management in littoral countries. For comparison during the spring floods of 2024, additional 350 million cubic meters of floodwater was redirected to the Caspian Sea only through newly constructed channels in the Atyrau region. This suggests that sustainable water management practices could more than offset the impacts of giga-scale hydrogen production projects on Caspian Sea levels

Conclusions and Recommendations
– Our primary conclusion is that concerns over water availability should not hinder policy dialogue on giga-scale hydrogen development in the Caspian region, as its impact on sea levels is minimal compared to other natural or man-made factors. The comprehensive environmental impact assessment processes should be adhered to and consulted to evaluate localized effects and guide the technical solutions.

– Factors such as chemical and thermal pollution from brine disposal, along with risks from Caspian Sea level variations, are likely to favor locating major projects on the steeper eastern shores. This area also offers strategic benefits, including westward export route accessibility and proximity to the Ust-Yurt Plateau, renowned for its outstanding wind and solar potential.

– The debate on Caspian Sea levels should focus on major factors like upstream water diversions and climate-driven changes. A Caspian Water Management Framework should be established for collaborative regulation of water use and desalination projects, ensuring sustainable and equitable resource management. The recent COP29 declaration in Baku emphasized the urgent need for enhanced regional cooperation to address this issue.

– Scientific Collaboration within the multilateral Data Observatory could be initiated as the first step to improve real-time monitoring of sea levels, inflows, and diversions. Such an initiative would provide critical data to support regional transparency and multilateral dialogue for water
management strategies.
– Littoral states and project developers should invest in innovative waste management techniques, such as extracting valuable minerals from brine to add economic value while addressing environmental challenges.
By implementing these strategies, stakeholders can balance hydrogen ambitions with sustainable water resource management, securing the Caspian’s ecological and economic future.

Glossary of Key Terms used:

Giga-scale projects: Renewable energy initiatives exceeding several gigawatts, with massive
capacity and transformative potential.
IRENA – International Renewable Energy Agency
Alkaline electrolyzers: hydrogen production devices that use an alkaline solution to split water
into hydrogen and oxygen. Alkaline electrolyzers are established traditional cost-effective
technology. However, they have lower efficiency and lower capacity of following the solar or
wind power variations compared to other modern electrolyzer.

PEM electrolyzers: Proton Exchange Membrane electrolyzers, which use a solid polymer
membrane for efficient hydrogen production. PEM electrolyzers are more suitable for variable
renewable energy inputs and have higher efficiencies. However the technology is still under
active development and is still more expensive compared to Alkaline electrolyzers.
ESIA – Environmental and Social Impact Assessment

The author sincerely thanks Agha Bayramov and Jachin Gore for their invaluable advice and insightful information.

References

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Urciuolo, F. (2024). The depleting water levels of the Caspian Sea: Why the choice to hold COP29 in Baku is so pertinent. Retrieved from [PDF document].

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