The low-carbon hydrogen sector grew in 2021 on the back of enterprise and government support and has moved from the technology stage to the implementation stage, but it still needs massive investment to be commercialized at a competitive cost, policymakers and executives said at the 4th Hydrogen Energy Ministerial Meeting in Tokyo held on Oct. 4.
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17 governments on Oct. 4 released hydrogen strategies, and more than 20 governments publicly announced they were working to develop strategies, compared with just three in 2019, the International Energy Agency said in a report launched at the conference.
It said the countries that have adopted hydrogen strategies have committed at least $37 billion, and the private sector has announced an additional investment of $300 billion, but putting the hydrogen sector on track for net zero emissions by 2050 requires $1.20 trillion of investment in low-carbon hydrogen supply and use through to 2030.
Noé van Hulst, Chair of the International Partnership for Hydrogen and Fuel Cells in the Economy, or IPHE, which comprises of 21 member countries, said its members alone had $30 billion of public funds announced for stimulating clean hydrogen, which is a 10% increase over the previous six months.
"Hydrogen is no longer in the technology stage but has rather progressed to implementation stage," Kajiyama Hiroshi, Japan's Minister of Economy, Trade and Industry said. "More in-depth, institutional measures are required in order to realize a hydrogen society."
After last year's announcement for carbon neutrality by 2050, Japan adopted a green growth strategy and action plan as its national strategy. In order to implement the plan, a two trillion yen fund was launched, Hiroshi said.
Hydrogen investments rose despite the coronavirus pandemic, with unprecedented private fundraising, mostly for manufacturing and to meet project demand, the IEA said.
"Companies specialised in producing, distributing and using hydrogen raised almost $11 billion in equity between January 2019 and mid-2021 – a considerable increase from prior years – and contracts funded by government recovery packages are expected to raise project investments substantially," it said, but added that investments were still short of decarbonization targets.
The IEA projected that every year until 2030, investments of $7 billion in electrolyzers will be required (30 times recent record investments) and $4 billion in fuel cell electric vehicles deployment will be needed (14 times recent record investments).
Middle East push
Suhail Bin Mohammed Al Mazroui, Minister of Energy and Infrastructure, UAE, said, "We still have major barriers facing us to fully commercialize hydrogen at a competitive cost."
The Middle East is working on several fronts to retain its energy market dominance and will sell both conventional hydrogen leveraging on its gas infrastructure and renewable hydrogen.
"As we are updating our energy strategy 2050, we believe hydrogen will be one of the potential fuels (for future)," Mazroui said in his speech.
The nation plans to install 44 GW solar capacity by 2050. At the same time UAE is a major gas producer and exporter, which will give it competitive advantage to further develop both conventional and renewable hydrogen, he said.
Saudi Arabia is building a large green hydrogen facility in Neom and it has a natural advantage in cost of gas and carbon capture for conventional hydrogen and green hydrogen, said Prince Abdulaziz bin Salman Al Saud, Minister of Energy, Kingdom of Saudi Arabia.
"The kingdom aims to localize the value chain in Saudi Arabia in line with the target in 2030 strategy but it also has the ambition to become a reliable supplier of all forms of clean hydrogen in the world," he said. "Our long term strategy is complimentary with that of Japan."
Australia is modeling itself as a supplier and its Energy and Emissions Reduction Minister Angus Taylor said it has a new agreement with India to develop hydrogen and solar.
Separately, Singapore's renewable energy firm Sembcorp Industries' subsidiary Sembcorp Utilities, Japan's energy and environment firm Chiyoda Corporation and trading firm Mitsubishi Corporation also signed a memorandum of understanding Oct. 5 to explore the feasibility of supplying decarbonised hydrogen to Singapore.