New hydrogen projects achieve record numbers; investments must triple to $700 bln by 2030 to hit net-zero target, report shows

Outlook & Strategy

September 21, 2022, by Ajsa Habibic

Hydrogen projects have reached record numbers globally as 680 large-scale projects were announced, which is an increase of 50% since November 2021. However, investments in hydrogen must triple by 2030 in order to achieve the global 2050 net-zero target, says a new report published by the Hydrogen Council.

The report, Hydrogen Insights 2022, was developed in collaboration with global consultancy McKinsey & Company and points out that the urgency to ramp up investments in industrial-scale hydrogen energy projects is greater than ever.

It highlights 680 announced large-scale hydrogen project proposals, representing a total of $240 billion in direct investment between now and 2030 – an increase of 50% since November 2021 alone.

According to the report, 10% of these large-scale hydrogen project proposals have reached final investment decisions (FIDs), are under construction, or are already operational.

Following this uptake in hydrogen project announcements, the industry, investors and governments are urged to quickly ramp up FIDs and enable project construction and operations as soon as possible.

Yoshinori Kanehana, chairman of Kawasaki Heavy Industries, Ltd. and co-chair of the Hydrogen Council, said: “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. 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 further explains that capturing the maximum climate value of hydrogen to deliver the 2050 net-zero carbon emissions target requires a tripling of investments in hydrogen projects by 2030 to $700 billion, equivalent to an additional $460 billion.

The Council report goes on to note that the 2030 hydrogen investment figure is equivalent to less than 15% of investment committed to upstream oil and gas over the past decade.