The global Hydrogen Council said in December 2023, that about USD 430 billion in projects, are required to reach the goal of decarbonisation.
Sanjiv Lamba, CEO of Linde and Co-Chairperson of the Hydrogen Council, said: “It’s promising to see clean hydrogen projects developing across geographies, with 12 GW of electrolyzer capacity reaching FID. However, we need to further build on this momentum if hydrogen is to fulfil its role in supporting the energy transition. This is achievable with the right regulatory frameworks in place, and through collaboration across the entire hydrogen value chain.”
Challenges facing the sector include high costs of capital and higher costs of renewable power, which have increased the cost of making renewable hydrogen.
Estimates for production costs of renewable hydrogen are up 30-65%, resulting in USD 4.5-6.5 per kilogram.
In the long run, the Hydrogen Council expects production costs to fall to USD 2.5-4/kg of renewable hydrogen.
A full report on Hydrogen Isights (2023), has quoted Bernd Heid, Senior Partner at McKinsey, who said cost increases have led to global interest rate hikes, supply chain constraints, and increased renewable energy costs.
Picture: net zero investor