More than 213GW of green hydrogen projects are planned for delivery by 2030, a significant increase from the 0.2GW operating currently, according to a report by consultancy Aurora Energy Research.

And electrolyser project sizes are scaling up as the technology and supply chains mature. To date, most projects have been between 1MW and 10MW, but by 2025 a typical project will be between 100MW and 500MW.

“If all of this capacity were to come online, it could produce up to 32mn t/yr of hydrogen,” says Anise Ganbold, global energy markets lead at Aurora.

"Electrolyser projects are still held back by red tape combined with a lack of specific policies and incentives" Howard, Aurora

A recent report by thinktank the Energy Transitions Commission suggested the world would need at least 50mn t/yr of hydrogen by 2030 to be on a pathway consistent with the goals of the Paris Agreement—although a greater role for blue hydrogen would reduce this figure.

However more projects are likely to go ahead over the next few years as other regions look to match deployment levels in Europe.

The EU has targeted 40GW of electrolyser capacity by 2030, and national governments in Europe have already pledged a combined 34 GW by the same date.

There is a pipeline of over 9GW in Germany, 6GW in the Netherlands, and 4GW in the UK—all scheduled to be operational by 2040.

Germany still offers the most attractive market for low carbon hydrogen development, but recently Poland and Italy have released hydrogen strategies that make them increasingly attractive for investment.

Italy’s is a long-term policy aiming to convert 20pc of final energy consumption to hydrogen-derived sources by 2050. Poland’s policy is focused on shorter-term goals and includes a plan to introduce a contract for difference support scheme by 2025.

Green hydrogen

The success of green hydrogen from electrolysis will be driven by two key factors: electricity prices—which makes up the bulk of production costs—and carbon intensity, the report says.

Last month, the European Commission approved a law containing a new classification for green hydrogen, implying an emissions limit of 3t CO₂/t of hydrogen produced.

Aurora expects only the power grids in Norway, Sweden and France would be sufficiently decarbonised to meet this threshold by 2030.

This means that for electrolysers outside these countries, and even within them, developers are likely to bypass the grid and connect directly with renewable power sources—mostly wind.

213GW – Projects planned for delivery by 2030

More will have to be done to bring the costs of green hydrogen down to those of blue and grey, according to the report.

“Governments across Europe have set out ambitious plans for hydrogen to drive the decarbonisation of industry and other parts of the economy, but electrolyser projects are still held back by red tape combined with a lack of specific policies and incentives,” says Richard Howard, research director at Aurora.

Green hydrogen production costs currently vary from $2.6-4.5/kg, blue hydrogen from $1.3-2.9/kg and grey hydrogen from $0.7-2.2/kg.

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Author: Tom Young