Globally, 131 large-scale hydrogen projects have been announced since February 2021, taking the total to 359 projects that will produce 10mn t/yr by 2030, according to the latest Hydrogen Insights Update from the Hydrogen Council, a global CEO-led initiative.

The world’s hydrogen demand needs to hit 212 mn t/yr for the goals of the Paris Agreement to be achieved, according to separate modelling by the IEA.

Total investment in projects along the whole value chain amounts to an estimated $500bn before 2030, the Hydrogen Council says. Around $150bn of these investments are considered mature—meaning the investment is in a planning stage, has passed FID, or is for a project already under construction.

10mn t/yr – 2030 hydrogen production based on current announcements

China has seen an uptick in activity, with more than 50 large-scale projects announced and over $180 bn in committed investments. Some 50pc of these are linked to transport applications.

Key announced projects since the last update include Sinopec’s ambition to build 1,000 refuelling stations in the next five years and the commissioning of a 200MW PV-connected hydrogen plant in the Ningxia region.

China wants hydrogen to form 10pc of its energy share by 2050.

Falling green hydrogen costs

Renewable rollout combined with falling electrolysis capex costs could lead to green hydrogen production at $2.4/kg in the near-term, the report finds. By 2030, the cost for electrolysis could significantly decrease to $1.7/kg in cost-optimal locations.

These costs are not low enough to export hydrogen to other countries at prices competitive with  Australia, Saudi Arabia or Chile.

“Investments are increasing by roughly $1bn every week. Most active areas are Europe, South America and the Middle East, with the US increasing in momentum and China setting very ambitious targets,” says Bernd Heid, a partner with McKinsey.

McKinsey collaborated with the Hydrogen Council in writing the report.

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Author: Tom Young