The Role of Hydrogen in Decarbonising Key Sectors

Crossing the tipping point: Hydrogen case study

As the world shifts toward a low-carbon future, hydrogen is emerging as a crucial component in decarbonisation strategies. In areas where direct electrification is challenging or impractical, hydrogen stands out as a vital alternative energy carrier. Crossing the tipping point: Hydrogen case study, created in collaboration with the University of Exeter, EEIST, and the Bezos Earth Fund, offers an overview of hydrogen’s potential role and what is required to accelerate adoption.

Key Points

Hydrogen’s potential in decarbonisation

Hydrogen could supply 13-24% of final energy demand by 2050, particularly in sectors where electrification is unfeasible or too costly. These include industries like steel production, shipping, long-term energy storage, and aviation.

Green hydrogen’s cost reduction trajectory

Green hydrogen, produced via electrolysis using renewable energy, is projected to become the cheapest form of hydrogen due to cost declines. Currently more expensive than fossil-fuel-based grey hydrogen, its cost is expected in time to undercut grey hydrogen and become the cheapest source of hydrogen in all markets.

Early adoption in existing hydrogen markets

The fastest path to scaling up green hydrogen is by replacing grey hydrogen in industries like ammonia production for fertilisers, methanol production, and crude oil refining. These sectors offer early opportunities for green hydrogen to reach cost parity.

Global commitments and policy support

A fast global transition can only be achieved by countries taking coordinated action. No single country can make this happen on its own. Nations like the UK, Germany, and Japan are already implementing policies such as ‘Contracts for Difference’ to support hydrogen adoption.

Challenges and the path forward

Despite its potential, green hydrogen faces challenges in terms of infrastructure, financing, and large-scale deployment. Policy support, innovation, and investment will be critical in making hydrogen a key part of the energy transition.

Hydrogen offers a versatile and promising solution for decarbonising sectors that are hard to electrify. The Hydrogen case study underscores the importance of strategic policies and international cooperation to unlock hydrogen’s full potential.