Hydrogen (H2) has the potential to play an important role in the future energy ecosystem. Technology developers, investors and policymakers are increasingly working hand-in-hand to harness that potential, and to find solutions that will improve H2’s commercial viability and accelerate deployment.   

The biggest challenge to H2’s competitiveness lies in managing the cost and variability of electricity. Renewable inputs such as solar and wind enable green H2 production but also mean it is exposed to intermittency. Developers consistently highlight two concerns: upfront costs and stability of supply. 

The author’s company’s research undertaken in the H2 sector confirms this, with three-quarters of project stakeholders citing capital costs as the most significant challenge, and 44% raising concerns about securing a stable energy input.¹ Without solutions to these issues, projects risk operating below capacity or failing to achieve economic viability. 

The International Energy Agency (IEA) reports that global H2 demand increased to nearly 100 MMt in 2024, up 2% from 2023 and in line with overall energy demand growth.²  

Projects must be both technically and economically robust to keep up with projected growth. The ability to integrate renewables, maintain electrolyzer performance and reduce operating costs will determine the speed at which the industry can reach delivery at scale. 

Distributed control systems (DCSs) and digital optimization tools are essential enablers, mitigating the impact of variable renewables, extending the lifespan of critical equipment and ensuring that every megawatt of power is translated into predictable H2 output. 

Keeping electrolyzers performing. By embedding digital intelligence throughout every stage of production, from the input of renewable energy through electrolyzer operation to storage and offtake, the industry can reduce costs, stabilize supply and enhance H2’s role in the future energy ecosystem. 

Electrolyzers are the most expensive and sensitive part of the system. Their performance ultimately determines project viability, as they represent the largest portion of both capital and operating expenditures. 

A DCS that integrates instrumentation with predictive data analytics allows operators to monitor electrolyzer health in real time. Parameters such as pressure, temperature and flow can be tracked continuously, while digital twin technology simulates operating scenarios to test how systems would respond to changing situations. 

Rather than reacting to failures, operators can act in advance, scheduling maintenance and adjusting processes to avoid costly downtime. This predictive approach is vital when the underutilization of electrolyzers can drive up the cost per kilogram of H2. 

Smarter and integrated energy management. Efficiency is not just a technical goal—it can make the difference between projects succeeding or stalling. With electricity costs comprising ~70% of production costs, inefficiencies in energy use are crucial to the economics of a project. Digital platforms and energy management systems enable operators to take a predictive view of energy usage. 

By modeling a wide range of factors—everything from weather forecasts to grid conditions and price signals—the author’s company’s industrial software solutiona  

can determine when it is most advantageous to run electrolyzers, when to store energy and when to reduce load. Field applications have shown that such predictive optimization can reduce energy costs by up to 20%, a margin that directly helps lower the levelized cost of H2. 

These efficiency gains are not just a technical achievement. They matter because of where the H2 will ultimately be used. Hard-to-abate industries such as steelmaking, cement and shipping are all exploring how low-carbon H2 can help support decarbonization efforts.   

Green H2, for example, is important to the direct reduction of iron ore in steel production, replacing natural gas feedstocks in ammonia and producing e-methanol as a promising alternative for maritime fuels. Each of these processes require large, stable volumes of green H2 at predictable costs. Digital tools that increase electrolyzer utilization or reduce power consumption create a ripple effect elsewhere, making decarbonization strategies more realistic and attractive for heavy industry. 

The IEA’s Global Hydrogen Review 2025 says that while the uptake of low-emissions H2 is not yet meeting the ambitions set in recent years—held back by high costs, uncertain demand and regulatory environments, and slow infrastructure development—there are still notable signs of growth. Low-emissions H2 production is expected to grow strongly by 2030.2 Policy and digitalization must advance together, as stable regulatory frameworks and shared data platforms are key enablers of scaling at pace.  

The integration of renewables is both the greatest opportunity and the greatest challenge for H2. Many projects are now designed for direct coupling with wind, solar and hydropower generation, bypassing grids, which are not always located close to projects. Integration is also appealing because it enables lower energy costs.   

Applied approach. Digitalized control strategies are helping plants adapt. In Denmark, for example, a partnership involving the author’s company, Skovgaard Energy, Topsoe and Vestas has created the world’s first dynamic power-to-ammonia facility. The project runs in step with the wind, producing only when renewable energy is available and scaling down when it is not.3 This efficient way of running energy facilities illustrates where digital tools can add real value. 

The author’s company’s recent agreement with SwitcH2 to provide automation and electrification solutions for its green ammonia floating production, storage and offloading (FPSO) vessel showcases how renewable energy can be leveraged to unlock low-carbon energy value chains. The FPSO will utilize treated seawater and use electrolysis to produce green H2 that will be combined with nitrogen extracted from the air to create green ammonia.  

Once synthesized, the ammonia will be condensed and stored onboard to be transferred to carrier ships via a floating hose system for transport to ports where it can be used as a marine fuel or cracked back to H2 for industrial use.4 This is an example of helping a hard-to-abate industry to operate leaner and cleaner, enabled by a comprehensive value chain ready to meet future demand for low-carbon solutions. 

H2 plants can operate as flexible demand-side response assets, balancing renewable-heavy grids while still delivering consistent H2 volumes. In Texas (U.S.), a large-scale project supported by a range of technology providers is aiming to combine solar and wind generation with underground salt cavern storage. The storage provides a buffer against supply volatility and ensures that H2 can be delivered steadily to downstream ammonia production.⁵ 

Developers are increasingly applying structured approaches that begin with a clear business case, an optimized electrical design and standardized modular plant components. This provides repeatable blueprints that lower risk and accelerate rollout. 

From there, the electrical design is optimized around efficiency and resilience to handle fluctuating renewables. Design principles are refined to directly address the intermittency of renewables and the sensitivity of H2 economics to energy losses. Finally, modular balance-of-plant designs are applied to simplify engineering, reduce risk and enable scalability. 

The modular, standardized approach is one that the author’s company has used in partnership with Charbone Hydrogen in support of its efforts to advance green H2 production in North America. With plans to develop multiple facilities across Canada and the U.S., this scalable model can be replicated across multiple production sites and will significantly reduce engineering time and fast track implementation.  

Collaboration across industry. The author’s company’s H2 research study1 shows that more than three-quarters of decision-makers see partnerships as essential to delivering projects, with technology providers, energy suppliers and investors identified as the most critical partnerships. Proven success on previous projects and the ability to address upfront costs are the two top criteria for selecting a partner. Beyond financing, long-term technical support and lifecycle efficiency are valued as essential for success.¹ 

Developers and operators consistently stress the need for partners that can provide not just technology, but also financial models, operational know-how and workforce training. The survey data shows that a proven track record and cost management top the list of partner requirements, but long-term technical support and skills transfer are also important.¹ 

As new plants move from pilot scale to hundreds of megawatts, the ability to train operators, troubleshoot systems remotely and share best practices across projects will become just as important as the hardware itself. Strategic partnerships and digital integration are essential to manage risk, ensure certification compliance and accelerate project delivery.  

This collaborative mindset is what will allow green H2 to move from individual projects to a connected global industry. The future of H2 production relies on how boldly we design, simulate and automate today. Early integration ensures resilience, affordability and safety, transforming H2 into a viable, scalable solution for generations to come.  

NOTE  

a ABB Ability™ OPTIMAX® 

LITERATURE CITED  

1 ABB, “Key trends and insights: Green hydrogen research study,” 2025, online: https://new.abb.com/process-automation/energy-industries/enabling-your-green-hydrogen-journey/green-hydrogen-research-study#pardotform  

2 IEA, Global hydrogen review 2025, October 2025, online: https://iea.blob.core.windows.net/assets/a6c466dd-b6f0-44bd-a60a-6940eccfb1c3/GlobalHydrogenReview2025.pdf  

3 ABB, “The world’s first dynamic, green power-to-ammonia plant takes shape,” April 20, 2023, online: https://new.abb.com/news/detail/102175/the-worlds-first-dynamic-green-power-to-ammonia-plant-takes-shape  

4 ABB, “ABB’s automation and electrification technology to support floating green ammonia production vessel,” October 8, 2025, online: https://new.abb.com/news/detail/129194/abbs-automation-and-electrification-technology-to-support-floating-green-ammonia-production-vessel  

5 ABB, “ABB signs agreement to support major power-to-x green hydrogen project in the U.S.,” March 19, 2024, online: https://new.abb.com/news/detail/113736/abb-signs-agreement-to-support-major-power-to-x-green-hydrogen-project-in-the-us