As a replacement for fossil fuels that are becoming increasingly rare, costly, and unstable owing to geopolitics, the globe is turning to green hydrogen generation. Certain massive investments will allow the existing energy axis to shift, and where some nations are positioning themselves as favorites to be the cheapest in their production.
These consider factors such as land cost and availability, location and accessibility, and even the availability of a safe and economical water supply. Because it must be generated with renewable sources in addition to being green hydrogen, the investment and cost of these are also important considerations.
In the long term, China, according to the analysis, will be the cheapest area to create green hydrogen. According to the research, by 2050, Chinese manufacturers might be exporting green hydrogen at a levelized cost (LCOH) of just over $0.65/kg, with Chile coming in close behind.
In an “optimistic” scenario, IRENA believes that markets like Morocco, Colombia, and Australia would trail the Chinese and Chileans.
Even in the most pessimistic cost scenario, China will be highly competitive, selling green hydrogen for roughly $1.10 per kilo, compared to Colombia’s $1.15 per kilo and Australia’s and Chile’s $1.20 per kilo.
In the best-case scenario, the United States and Saudi Arabia might attain levelized prices of roughly 0.75 to 0.80 dollars per kilogram. Prices where concerns like access to water come into play, and which, according to the gloomy scenario, may drive Saudi Arabia’s expenses up to 1.7 dollars per kilogram.
Morocco is also affected. As seen in the graph, the Moroccans have the capacity to manufacture green hydrogen at levelized prices equivalent to Chinese production in the optimistic scenario. However, because of the lack of access to water, the gloomy scenario reduces production by 63 percent, resulting in a large increase in the price of a kilo to roughly 1.4 dollars.
Colombia is a fantastic surprise and a source of optimism
Without a sure, the presence in the highest section of Colombia stands out on the list. The United States has witnessed how its strong commitment to renewable energy is paying off, having increased its capacity by 100 times to 2.8 GW in just 24 months.
The Colombian government has set a goal of installing 3 GW of electrolyzers by 2030, which, according to Colombian Minister of Energy Diego Mesa Puyo, will allow them to sell green hydrogen for $1.70 per kg by 2029, thanks to factors such as abundant water and the high speeds of Colombian marine winds, which, according to the Minister, reach 13 meters per second and contribute to the country’s low electricity prices.
The presence of Japan and South Korea at the bottom of the table, in addition to the presence of Colombia at the top, is without a doubt the most startling part of the table. Two markets that have made significant technological investments, yet will not be able to create the vector, despite being leaders in the research and production of electrolyzers. However, due to a lack of land, high energy prices, and a lack of commitment to renewables, the two Asian countries will be among the most costly to produce in the world, even in the long run.
In the optimistic scenario, Spain is ranked 11th, with nearly identical values to Saudi Arabia, around 0.85 dollars per kg. In the most pessimistic scenario, this number rises to 1.6 dollars per kg. A market that would be the first in Europe and would support the goal of transforming the Iberian Peninsula into a European Union energy export powerhouse.
