IEA chief calls for ‘momentum’ on hydrogen supply and demand
IEA chief calls for ‘momentum’ on hydrogen supply and demand | Windpower Monthly
Launching the IEA’s Global Hydrogen Review 2023, executive director Fatih Birol said low-emissions hydrogen still accounts for less than 1% of overall hydrogen production and use due to the slow rollout of financial incentives and stubborn cost pressures.
But production levels will increase substantially by 2030 if all announced projects are realised and greater efforts are made on encouraging uptake, he added.
Installed capacity and volumes remain low as developers wait for government support before making investments, according to the report. Meanwhile, high inflation and supply chain disruptions are also contributing to rising costs.
“This confluence of factors is particularly detrimental for an industry that faces high upfront costs related to equipment manufacturing, construction and installation,” the report states. It further warns that time lags between policy announcements and implementation are delaying projects.
But by the end of 2022, electrolyser capacity for hydrogen production reached almost 700MW and total capacity could nearly triple to 2GW by the end of 2023 and rise to 420GW by 2030, according to the IEA.
Birol called for greater progress “on technology, regulation and demand creation” to ensure that low-emissions hydrogen can realise its full potential.
The report recommends steps for governments to take to reduce risk and improve the economic feasibility of low-emissions hydrogen, which include:
• Urgently implement support schemes for low-emission hydrogen production and use
• Take bolder action to stimulate demand creation for low-emission hydrogen, particularly in existing hydrogen uses
• Foster international cooperation to ease hydrogen certification and the mutual recognition of certificates
• Quickly address regulatory barriers, particularly for project licensing and permitting
• Support project developers to maintain momentum during the inflationary period and to extend regional reach
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