Hydrogen Rolling With $300 Billion Commitment To Projects by 2030

The Hydrogen Council, a global CEO-led initiative of 92 leading energy, transport, industry, and investment companies with a vision to develop the hydrogen economy has released a report titled, ‘Hydrogen Insights 2021: A Perspective on Hydrogen Investment, Deployment, and Cost Competitiveness’. The report, made by Mckinsey and Co, highlights the rapid acceleration of hydrogen projects in response to government commitments to deep decarbonization.

It also offers a comprehensive perspective on market deployment around the world, investment momentum as well as implications on the cost competitiveness of hydrogen solutions. 

According to the report, as of early 2021, over 30 countries have released hydrogen roadmaps and governments worldwide have committed public funding in support of decarbonization through hydrogen technologies. No less than 228 large-scale projects have been announced along the value chain, with 85 percent located in Europe, Asia, and Australia. These include large-scale industrial usage, transport applications, integrated hydrogen economy, infrastructure, and giga-scale production projects.

The report says that if all announced projects come to attainment, total investments will reach more than USD 300 billion by 2030. Out of this investment, USD 80 billion can currently be considered “mature”, which means these projects are in the planning stage, have passed a final investment decision (FID), or are under construction, already commissioned, or operational. 

Speaking on the rapid increase in Hydrogen deployment, the Chairman and CEO of Air Liquide and Co-chair of the Hydrogen Council, Benoît Potier stated, “A huge step in the fight against climate change has been taken, as both governments and investors now fully grasp the role hydrogen can play in the energy transition. 

“Now, to bring this potential to its full fruition, governments, investors and industrial companies must work together to scale up the hydrogen ecosystem around the world. Their collaboration in the coming months will allow for many of the projects around the world to become a reality and to turn hydrogen into a new, clean, abundant, and competitive energy carrier,” Potier added. 

The report has explained, how the deployment through clusters with strong off-takers will help suppliers share both investments and risks while establishing positive reinforcing loops. 

Three cluster types are already gaining traction, and these are;

Industrial centers that support refining, power generation, and fertilizer, and steel production, Export hubs in resource-rich countries, and Port areas for fuel bunkering, port logistics, and transportation. 

Consequently, the reduced costs from clusters will enable global trade in hydrogen, connecting future major demand centers such as Japan, South Korea, and the European Union to regions of abundant low-cost hydrogen production means like the Middle East, North Africa, South America, or Australia.

“We are seeing a new level of maturity for the hydrogen industry, and this is only set to accelerate. Hydrogen Council members collectively are planning a six fold increase in total hydrogen investments through 2025 and a 16-fold increase through 2030,” said Daryl Wilson, Executive Director of the Hydrogen Council.

He further added, “The plan is to direct most of this investment toward capital expenditures, while collaborations, consolidations, and innovation will also be a key focus.”