The hype surrounding hydrogen has left a mark: interest in emissions reduction via hydrogen has given rise to many new H2 production projects. While the capacity of existing electrolyzers powered by solar panels totals 3.2 GW, the capacity of those under construction is 10.5 GW, with projects for another 122.1 GW at the pre-investment stage. The same is typical for the production of H2 based on wind energy: in this segment, the capacity of operating electrolyzers totals 2.1 GW, and that of those under construction and planned stands at 12.6 GW and 163.8 GW, respectively.
Saudi Arabia, where the aggregate capacity of electrolyzers under construction is 5.2 GW, could become a major producer of green hydrogen. Producing countries could also include Egypt, Morocco, Namibia and Oman. In some cases, electrolyzers will be used to utilize excess electricity produced by wind and solar generators during the hours of low demand.
Another area of use for hydrogen, which is produced by, among other things, steam reforming of methane, could be power generation. The addition of H2 to natural gas could reduce emissions from gas-fired power generation. According to Global Energy Monitor, six small generating facilities that use a mixture of hydrogen and natural gas are currently operating in Europe. A total of 44.6 GW of generating capacity is at the construction and planning stage, of which 30.8 GW is based in the UK, Germany and Italy.
The future of the industry will also largely depend on the development of transport infrastructure. This refers to the re-equipment of gas pipelines for H2 supplies. In the past year, the overall length of planned projects has increased by 40%, reaching 50,200 km, of which almost 20,000 km stretch across Germany, Spain and Bulgaria. However, as in the case of power generation, the vast majority of projects remain on paper: new projects face limited demand and no guarantee of return on investment.
