Over the past several years, the world has been engaged in an energy transition. According to the UN, more than 70 countries have set ambitious net-zero emissions goals, and many have enacted new regulations and initiatives to meet those targets. These pathways include, but are not limited to, the broader adoption of electric vehicles (EVs); utilising new low-/zero-carbon fuels (e.g., blue/green hydrogen) to decarbonise power, transport and heavy industry; increasing investments in renewable energy; increasing the percentage of bio-feedstock blending in transportation fuels; incorporating the use of CCS or CCUS; and boosting the production of biofuels and alternative/renewable fuels, among others.

One pathway to help economies decarbonise is the use of low-/zero-carbon hydrogen. Undoubtedly, hydrogen will play a major role in global decarbonisation activities since it is well-suited to provide clean energy to the transportation, industry, power and buildings, and processing sectors. Most analysts forecast a stark rise in hydrogen demand over the next 25 years. According to the IEA, global hydrogen demand was approximately 91mn t in 2021. Several industry forecasts show global hydrogen production reaching anywhere between 300mn t/yr and 650mn t/yr by 2050. For example, the International Renewable Energy Agency forecasts global hydrogen production increasing sixfold, to nearly 620mn t/yr, by 2050.

With the stark rise in global hydrogen demand, a significant amount of capital investments are needed to satisfy forecast consumption

Conversely, BP’s 2023 Energy Outlook forecasts global hydrogen demand reaching 300–460mn t/yr within the same timeframe, based on accelerated and net-zero scenarios.

With the stark rise in global hydrogen demand, a significant amount of capital investment is needed to satisfy forecast consumption. These investments include capital-intensive hydrogen production projects, electrolyser manufacturing, pipeline conversion and construction, and hydrogen refuelling infrastructure.

The following is a brief overview of hydrogen capital projects, strategies and initiatives being implemented throughout Africa, Asia and Canada.

Gulf Energy Information’s Global Energy Infrastructure (GEI) database has been tracking hydrogen projects globally for more than two years. Since the database’s inception in early 2021, active hydrogen projects have increased more than tenfold, to nearly 1,300—a nearly 380pc increase in project announcements.

Most active projects are in Western Europe, followed by Asia and the US (see Fig.1). These three regions account for 80pc of active hydrogen projects globally, with Western Europe accounting for nearly 50pc alone. IThese projects represent a total capex of more than $1.13tn. Most projects—nearly 70pc—are in the planning/proposed stage. The following is a breakdown of active hydrogen projects by status:

• Planning/proposed: 69pc.
• Feasibility study: 17pc.
• Feed: 7pc.
• Under construction: 7pc.

When broken down by production route, 76pc are green hydrogen projects, followed by blue hydrogen pathways (see Fig.2).

As detailed in the individual regional reports of this analysis, hundreds of billions of dollars will be invested by the end of the decade to significantly boost wind and solar power generation capacity to fuel the massive number of electrolysers that will be put into operation. The electrolyser market has increased in size substantially over the past two years. According to the IEA, total installed electrolyser capacity eclipsed 1GW in 2022, with projects in the pipeline that could increase installed capacity to 134–240 GW by 2030.

Africa

Most projects in Africa are centred in four countries: Egypt, Morocco, Namibia and South Africa. These four nations account for more than 70pc of active projects in the region, with Egypt holding nearly 40pc market share in active hydrogen projects. The following is a breakdown of active hydrogen project market share in Africa by country:

• Egypt: 38pc
• South Africa: 13pc
• Morocco: 11pc
• Namibia: 9pc
• Other: 29pc.

Egypt has ambitious plans to become a green hydrogen/ammonia production hub in the region, with the government having announced plans to capture 5pc of the global hydrogen market by 2040. Most of these projects are being developed in the Suez Canal Economic Zone (SCZone). Since mid-2022, the SCZone has seen more than $50bn in green hydrogen/ammonia project announcements. These investments include the production of blue and green hydrogen, waste-to-hydrogen, renewable power infrastructure and green fuels.

1,300 – Active projects tracked by GEI’s database

Due to its location, South Africa can benefit greatly from renewable power production from wind and solar. The country plans use to its natural resources to decarbonise various industries within its borders, including power generation—South Africa presently relies on coal for c.80pc of its electricity needs. In its Hydrogen Society Roadmap report, the government identified 70 action points to decarbonise the nation. These included pathways to decarbonise energy-intensive industries (e.g., cement, mining, steel and oil refineries) and heavy-duty transport; enhancing the nation’s power grid with green power; boosting the production of hydrogen production and fuel-cell components; creating a green hydrogen export market; and increasing the role of hydrogen in various industries.

To increase the production of green hydrogen, South Africa’s Department of Science and Innovation released the South Africa Hydrogen Valley Final Report. This detailed the potential development of three domestic hydrogen hubs—Johannesburg, Durban/Richards Bay and Mogalakwena/Limpopo (see Fig.3)—and various projects to decarbonise various industrial sectors and transportation.

 Namibia also plans to increase hydrogen production by making use of its sunny climate—the nation sees more than 300 days per year of sunshine. Namibia will utilise solar power to produce hydrogen for both domestic consumption and export. The country’s most capital-intensive project is being developed by developer Hyphen Hydrogen Energy. The company’s two-phase, $10bn project will produce green hydrogen that will be converted into green ammonia for export, primarily to German energy company RWE. The project could ultimately produce up to 1mn t/yr of green ammonia.

Namibia may also be the site of Africa’s first hydrogen-powered power plant. France’s HDF Energy is investing nearly $200mn to develop a power station run on clean hydrogen. Once operational in 2024, the plant will help the nation mitigate power imports from neighbouring countries, primarily South Africa. Namibia currently imports c.40pc of its power needs. These two projects will enable the country to satisfy domestic power demand as well as become the first in the region to be both carbon-neutral and start up a hydrogen power plant. 

According to Morocco’s Green Hydrogen Roadmap, the government has ambitious plans to significantly boost domestic hydrogen production. Doing so will help the African country mitigate fertiliser imports and increase the market share of renewable energy capacity in its energy mix. Morocco’s goal is to increase its renewable energy market share from less than 40pc in 2022 to 52pc by 2030 and up to 80pc by 2050. Additional solar and wind projects will provide the country with both clean electricity and feedstock for green ammonia production. Companies such as France’s Total Eren and local phosphate and fertiliser giant OCP are providing Morocco with more than $25bn in green hydrogen/ammonia projects.

Although Egypt, Morocco, Namibia and South Africa account for most active hydrogen projects in the region, other African nations are investing in green hydrogen/ammonia projects as well. Mauritania has nearly $75bn in green hydrogen projects under development. These capital investments could lead to the production of nearly 10mn t/yr of green hydrogen by the early-to-mid 2030s.

Other nations—such as Algeria, Angola, the Democratic Republic of Congo, Djibouti, Kenya, Uganda and Zimbabwe—have all announced plans, memorandums of understanding and/or strategies to increase hydrogen production capacity. These projects will help Africa significantly boost the production of renewable power, green hydrogen and clean ammonia/fertiliser, increase clean energy exports to regions such as Europe and help domestic job creation, among other benefits.

Asia-Pacific 

Much like the rest of the world, many Asian countries are pursuing net-zero goals. Asia is home to five of the ten largest CO₂ emitting nations (China, India, Indonesia, Japan and South Korea). To combat CO₂ emissions, many Asian nations have instituted pathways and programmes to reach net-zero goals by mid-century. Most of these initiatives include heavy investment in hydrogen production, hydrogen infrastructure and hydrogen fuelling.  

Asia-Pacific accounts for 21pc of active global hydrogen project market share. The region is investing more than $350bn in new hydrogen capacity and infrastructure over the next several years. At the time of this publication, the GEI database was tracking nearly 275 active hydrogen projects in the region. Australia accounts for nearly half of these projects, followed by China and India. A breakdown of active hydrogen project market share in Asia is shown in Fig.4.

Although the Asia-Pacific region has announced many new hydrogen projects over the past few years, few have reached FID. In turn, more than 90pc of the region’s hydrogen projects are in preconstruction phases, such as in feasibility studies, pre-Feed and Feed. Regardless, the region has allocated substantial capital to increase hydrogen production and infrastructure and boost its market share in electricity generation, transport, mining, shipping and within industrial processing operations, among other areas. 

Australia intends to become a major green hydrogen/ammonia production hub for the Asia-Pacific region. Australia’s 2019 National Hydrogen Strategy details nearly 60 joint actions that could propel the nation to be a leader in green hydrogen production. These include short-term initiatives such as advancing pilot projects, trials and demonstration projects; assessing supply chain infrastructure needs; and developing much-needed infrastructure for prospective hydrogen hubs in regions such as Kwinana, Gladstone, Pilbara and Whyalla, among several other locations. Australia’s long-term goals (i.e., from 2025) include scaling up operations, production and infrastructure to become a major player in regional and global hydrogen value chains.

However, since the country’s hydrogen strategy was developed several years ago, the government is revising several aspects to attract more investments into the sector. This announcement has come in light of the recent passage of the US Inflation Reduction Act and other nations around the world offering attractive tax breaks and subsidies to invest in renewables, green hydrogen production capacity and infrastructure in their respective countries. As of Q4 2022, the Australian government has allocated nearly A$530mn (more than $350mn) of funding to various consortiums and companies to develop hydrogen projects/hubs domestically.

Hydrogen will play a major role in global decarbonisation activities since it is well-suited to provide clean energy to the transportation, industry, power and buildings, and processing sectors

Despite stiff competition from other countries trying to attract hydrogen investment, Australia continues to be the leader in project development within Asia-Pacific, accounting for more than $175bn in capital investments to 2035. These investments include major projects and hubs such as the nearly $70bn Western Green Energy Hub, the $36bn Asian Renewable Energy Hub, the $15bn Desert Bloom project, Fortescue Future Industries’ North Queensland Super Hub, the $10bn CQ-hydrogen project, and Sun Brilliance’s Karratha and Murchison Hydrogen Renewables’ projects (each costing c.$7bn), among several other multibillion-dollar projects.

These projects will complement new hydrogen infrastructure under development in the country, including hydrogen fuelling stations, blending with natural gas for electricity generation, and  decarbonising domestic heavy industrial industries (such as mining and heavy-duty transport).

China last year unveiled its hydrogen strategy to 2035. The country’s goals are to increase domestic green hydrogen production to 100,000–200,000t/yr by 2025, place 50,000 hydrogen-fuelled vehicles on the road within that timeframe and significantly build out hydrogen refuelling centres within the country. China is the world's largest hydrogen producer, but most of the nation’s hydrogen is produced through coal gasification. This grey hydrogen is both energy- and emissions-intensive.

China has ambitions to increase green hydrogenproduction significantly as the cost of production falls. The China Hydrogen Alliance forecasts Chinese hydrogenproduction to reach 35mn t/yr by 2030 and c.60mn t/yr by 2050.

To meet these ambitious goals, China  is significantly increasing capital investments in green hydrogen production projects. The GEI database is tracking more than $150bn in capital investments in China, with nearly 30 green hydrogen projects under development (see Fig.5). These projects, along with additional gas imports, will help China reduce coal-fired power generation, mitigate emissions and increase green ammonia production. They will also be complemented by additional hydrogen infrastructure—such as state-controlled Sinopec’s west-to-east green hydrogen transmission pipeline from Inner Mongolia to cities in east China—and several partnerships to develop hydrogen refuelling stations in major Chinese cities.

India’s government has announced plans to become energy independent by 2047 and achieve net-zero emissions by 2070. To help achieve these goals, the country has unveiled its National Green Hydrogen Mission, approved by the cabinet in January 2022. India plans to achieve a green hydrogen production capacity of 5mn t/yr by 2030 and have 125GW of renewable energy capacity at a cost of nearly $98bn in capital investment. The government has also announced more than $2bn in incentives to jumpstart domestic green hydrogen production projects. This move is an effort to reduce the cost of green hydrogen production in India—which, at the time of publication, was INR300–400/kg ($3.66/kg–$4.89/kg)—and attract additional investment. The country has also extended its transmission fee waiver for renewable energy to green hydrogen plants commissioned before January 2031. This incentive could cut the cost of interstate transmission charges, reducing green hydrogen production costs by INR1–2 per unit of power transmitted

At the time of publication, India held the third-largest market share in active hydrogen projects in the region, with most of the country’s domestic projects under development through green hydrogen pathways (see Fig.6). These facilities will not only provide zero-carbon emitting hydrogen feedstock for India’s hydrocarbon processing sector and hard-to-abate industries such as steel and cement manufacturing, but also enable the country to replace ammonia imports for fertiliser production with domestic, green alternatives by 2035.

At the time of publication, Japan’s government was revising its hydrogen strategy. The country’s goals are to increase hydrogen supplies from 2mn t/yr now to 3mn t/yr by 2030, 12 mn t/yr by 2040 and up 20 mn t/yr by 2050. To accomplish this pathway to carbon-neutrality, Japan plans to invest $113bn in public and private sectors to create domestic hydrogen and green ammonia value chains. The additional hydrogen and green ammonia production/imports will enable the country to slash emissions from heavy processing industries and power generation. For example, Jera, Japan’s largest power producer, is studying the use of ammonia as a fuel to co-fire with coal at its power plants, and the country’s steelmaking industry is conducting research on using green hydrogen to power electric furnaces to make high-quality steel.

Japan’s Agency for Natural Resources and Energy has announced a two-prong approach to increase the development of clean hydrogen/ammonia value chains domestically. The first strategy includes subsidies for clean hydrogen and ammonia producers (i.e., green and blue hydrogen) to help make hydrogen production cost-competitive against coal and LNG. The second prong includes a support scheme to build industrial clusters for the use of clean hydrogen/ammonia.

Many other Asian nations are investing in their domestic hydrogen production value chains. These projects include the production of both blue and green hydrogen/ammonia production routes; hydrogen infrastructure buildouts; utilising hydrogen and/or ammonia to decarbonise heavy industry, transportation and shipping; and power generation.

Indonesia has announced plans to become carbon-neutral by 2060. To reach this goal, the nation plans to significantly boost the use of renewables in the country’s energy mix. The additional solar and wind capacity provides the country with both renewable power generation capabilities and feed for electrolysers to produce green hydrogen. The additional hydrogen and clean ammonia supplies will help Indonesia decarbonise its power generation sector—several power generating firms are now testing co-firing of hydrogen and ammonia in their natural gas and coal-fired power plants—and create a regional ammonia production/export hub.

Although South Korea’s hydrogen ecosystem is based on grey hydrogen production routes, the government has created a pathway to increase green/blue hydrogen production to help decarbonise the economy. According to South Korea’s Ministry of Trade, Industry and Energy (Meti), the country has three major growth strategies to build out a domestic clean hydrogen supply chain: scale-up, build-up and level-up. The following is a breakdown of each segment of this programme (known as 3UP), according to Meti:

• Scale-up: This strategy includes expanding clean hydrogen demand domestically for power generation and transportation, increasing the deployment of hydrogen-fuelled heavy-transport vehicles (e.g., buses and heavy-duty trucks)—Meti has announced an action plan to produce 30,000 hydrogen-fuelled commercial vehicles by 2030—and developing large-scale hydrogen production bases outside South Korea.
• Build-up: This strategy focuses on developing a legal framework and building an installed asset base for hydrogen distribution infrastructure (e.g., hydrogen fuelling stations, pipelines and hydrogen/ammonia receiving terminals). For example, one of Meti’s action plans is to build 70 liquid hydrogen fuelling stations by 2030. The build-up plan also includes opening a hydrogen bidding market, hydrogen business laws and a clean hydrogen certification system.
• Level-up: This programme focuses on advancing and optimising technical innovation in the country’s hydrogen value chain and lifecycle from production to distribution.

Canada

In late 2020, the government of Canada released the Hydrogen Strategy for Canada, which detailed the role hydrogen will play in its 2050 net-zero ambitions.

According to the report, Canada is targeting hydrogen to deliver up to 30pc of its end-use energy by 2050. This would increase domestic hydrogen demand to 4 mn t/yr by 2030 and up to 20 mn t/yr by 2050. The strategy is based on eight pillars—strategic partnerships, de-risking investments, innovation, codes and standards, enabling policies and regulations, awareness, regional blueprints and international markets—that will ultimately lead to Canada’s hydrogen vision for 2050.

Canada plans to use a mix of pathways to increase hydrogen production. These include electrolysis (green hydrogen), fossil fuels (blue hydrogen, which will include CCS or CCUS), gasification of biomass (green hydrogen) and production as a byproduct from industrial operations. These routes will enable Canada to decarbonise several industrial sectors, including transportation (the nation plans to have more than 5mn fuel-cell EVs on the road by 2050), mining, manufacturing and power, as well as utilising hydrogen as a feedstock for the refining and chemical processing industries.

At the time of this publication, the GEI database was tracking more than 40 hydrogen projects in the region. At 32pc, the province of Alberta holds the highest market share in active hydrogen developments. Alberta is followed by British Columbia (22pc), Quebec (16pc), Ontario (14pc), Nova Scotia (8pc), and Newfoundland and Labrador (7pc), with other provinces accounting for 1pc.

---

Author: Lee Nichols