Report shows 680 large-scale projects proposed globally but awaiting final investment decisions
The pipeline of hydrogen projects is continuing to grow but actual deployment is lagging, according to Hydrogen Insights 2022, a new report from the Hydrogen Council. The report shows 680 large-scale (above 1 MW of electrolysis or equivalent) hydrogen project proposals have been announced, representing a total direct investment of US$240 billion between now and 2030 – an increase of 50% since November 2021 alone. But the next step will be to encourage quick ramp up of final investment decisions (FIDs) to jumpstart project construction and operations.
Hydrogen Insights 2022 was developed to provide a fact-based outlook on hydrogen deployment around the world, with the objective to guide regulatory and investment decision-making to scale up the hydrogen energy ecosystem. It was authored by the Hydrogen Council – a global CEO-led initiative fostering the use of hydrogen in the clean energy transition – and produced in collaboration with global consultancy McKinsey & Company.
“With the growing concerns around energy security, it is clear our economies need hydrogen. But on-the-ground deployment is not moving fast enough and needs to accelerate to realize the benefits of hydrogen,” said Yoshinori Kanehana, chairman of Kawasaki Heavy Industries, Ltd., and co-chair of the Hydrogen Council. This report proposes a series of priority actions for both policymakers and industry to overcome the challenges and accelerate large-scale hydrogen deployment.
“In addition, the report helps us understand the current state of the global hydrogen economy by highlighting what’s really happening in terms of deployment, financing and investment, as well as offering predictions for the future.”
The report shows that investment levels must substantially increase for the world to be on track for net-zero emissions by 2050. The current 2030 hydrogen investment figure is equivalent to less than 15% of the investment committed to upstream oil and gas over the past decade . Capturing the maximum value of hydrogen to deliver on the net-zero target will require a tripling of investments in hydrogen projects by 2030 to US$700 billion, the report estimates, equivalent to an additional US$460 billion.
“Climate change is the existential crisis of our time, and it will require businesses and governments working together to address it and we must do more now,” stated Tom Linebarger, executive chairman and chairman of the Board of Cummins Inc., and co- chair of the Hydrogen Council. “To move to a zero-emissions future, we must have multiple solutions available for our customers who require vastly different applications around the world and hydrogen will play a critically important role.”
Joint action by the public and private sectors is urgently needed to move projects from proposals to FIDs, the report emphasizes. To that end, it includes priority actions for both policymakers and industry intended to help accelerate hydrogen deployment.
Access the full 2022 report here.