C-MACC Hydrogen Weekly Update 3
This hydrogen service is intended to provide perspective on a very fast-moving market. An average of 10 new hydrogen projects have been announced each week for the last few years, with the IEA database adding 1100 new initiatives between its 2020 and 2022 surveys. The pace has not slowed in 2023. But many of the announcements lack substance, and many more lack any explanation around why the economics might work. Others are just concepts that will require too many things to go right for them to make sense. Our goal with this work is to make sense of the noise, provide updates on technological advances and breakthroughs, and focus on what is happening that will move the needle.
- There is not enough progress in clean hydrogen today to suggest that any of the near and medium-term goals can be met, and there is growing concern that real project momentum is slowing.
- A lack of compelling economics drives the slowdown to move forward with either blue or green hydrogen at enough scale to make a difference – we should be pushing blue much harder today.
- Green hydrogen requires an equipment learning curve that blue does not and providing incentives to boost blue hydrogen quickly (this decade) will be much cheaper than trying the same with green.
- Governments could drive electrolyzer development by encouraging projects based on mixed power initially – phasing towards 100% green power over time – looking for power is slowing things down.
- Hydrogen is critical to many energy transition plans, including renewable fuels, synthetic fuels, marine fuels, clean steel, and decarbonizing many industry segments – the pace needs to accelerate.