Global Strategies: Expanding the Hydrogen Economy
The world has witnessed a significant increase in announced and planned national hydrogen policies in the last 2 years. According to the International Energy Industry’s (IEA) latest Global Hydrogen Review, 17 governments have released hydrogen strategies, more than 20 governments have publicly announced they are working to develop strategies, and numerous companies are seeking to tap into hydrogen business opportunities. Let us take a high-level look at examples of countries making global strategies for expanding the Hydrogen Economy.
In June 2021, The DOE announced Hydrogen Energy Earthshot, an ambitious initiative to slash the cost of clean hydrogen by 80% by 2030. By doing this, the US government expects to unlock a fivefold increase in demand for clean hydrogen. Previous economic analysis from the National Renewable Energy Laboratory (NREL) shows detailed scenarios for expanding the US hydrogen market size and doubling or even more than tripling current demand. Expanding other options for hydrogen production is critical to the increased supply of hydrogen in U.S. for the coming years.
Strategies for expanding the hydrogen infrastructure is making great strides. The DOE has launched H2USA -a public-private collaboration with federal agencies, automakers, hydrogen providers, fuel cell developers, national laboratories, and additional stakeholders to advancing hydrogen infrastructure to support more transportation energy options for U.S. hydrogen consumers. GenH2 is one of the U.S. companies investing in infrastructure solutions to expand the hydrogen economy in the U.S. and globally.
Interest in hydrogen has grown exponentially, with the launch of the EU Hydrogen Strategy and the European Clean Hydrogen Alliance being major milestones. The strategy emphasizes use of hydrogen in industry and heavy transport as well as its balancing role in the integration of variable renewables (particularly offshore wind in the northwest region and solar photovoltaic (PV) in the south). The Alliance brings together industry, national and local public authorities, civil society and other stakeholders to implement the strategy. A significant step taken by the European Commission in adopting low-carbon hydrogen technologies came from proposals to modify directives and regulations announced in the FIT for 55 package in July 2021. These proposals will incorporate into EU legislation several targets for using hydrogen and hydrogen-based fuels in industry and transport, and for developing required infrastructure.
The European Union has registered progress in adopting hydrogen technologies. The Fuel Cells and Hydrogen Joint Undertaking (FCH JU) has played a fundamental role with its programs to support research, innovation and demonstration. More than 140 MW of electrolysis for dedicated hydrogen production have been installed, accounting for more than 40% of global capacity. The strong signals sent by government strategies have created momentum for additional deployment.
Japan is one of the countries that has been spearheading efforts to adopt hydrogen technologies. It was the first country to release a hydrogen strategy in 2017 and has been leading international co-operation since 2018 through its annual Hydrogen Energy Ministerial meetings. The country considers hydrogen technologies as practical options to decarbonize significant parts of its energy and industry sectors and to boost energy security.
Although Japan has yet to publish details on its plans to achieve the 2050 climate pledge announced by Prime Minister Suga (October 2020), hydrogen is likely to be an important part of its program. The government’s Green Growth Strategy from June 2021 includes a target to expand hydrogen use to 3 Mt in 2030. To support this goal, the government announced a public investment plan of JPY 700 billion (~USD 6.6 billion) to develop hydrogen supply chains.
The Canadian government has already established a series of clean energy support programs to enable the development of business cases for hydrogen technologies. In June 2021, Natural Resources Canada announced the Clean Fuels Fund, providing CAD 1.5 billion (~USD 1.1 billion) to help private investors with upfront capital costs to construct new clean fuel production capacity, including support for developing at least ten hydrogen projects. In addition, the Net zero Accelerator initiative will provide up to CAD 8 billion (~USD 6.0 billion) for projects that reduce domestic GHG emissions, including decarbonization of large industrial emitters, fuel switching to hydrogen in industrial processes, and development of carbon capture utilization & storage (CCUS) capacities for hydrogen production in heavy industries already using hydrogen.
In January 2021, the world’s largest PEM electrolysis plant at Bécancour was put into operation. The project, which includes a 20 MW electrolyser running on hydropower, doubled the site’s hydrogen production capacity. Currently, close to 100 MW of electrolysis projects are at different stages of development; if all are realized, total installed electrolysis capacity for dedicated hydrogen production could reach around 120 MW. In the Announced Pledges Scenario, electrolysis capacity in Canada reaches more than close to 4 GW by 2030, 40 times more than the capacity currently under development.
With these countries making investments and being strategic in expanding the hydrogen economy, the goal of a cleaner energy global ecosystem can be reached. We at GenH2 are working strategically to be a leader in helping meet those goals.