Green hydrogen supply will be uncertain for decades to come

The supply of green hydrogen from renewable electricity will remain scarce in the short term and uncertain in the long term, predicts a new study published in Nature Energy.

Green hydrogen and derived clean fuels are especially valuable for achieving climate neutrality. They can replace fossil fuels in industry or long-distance transportation where direct electrification is not feasible.

However, even if production capacities grow as fast as wind and solar power, the renewable champions in growth rate, green hydrogen supply will be less than 1% of final energy globally by 2035, while the European Union could reach the 1% mark a little earlier, around 2030.

In particular, the EU’s 2030 plan to supply 10 million tons of green hydrogen with domestic energy capacity will be out of reach unless policymakers can foster unprecedented growth for energy technologies.

By 2040, a breakthrough toward greater green hydrogen shares is more likely, but large uncertainties prevail, increasing current investment risks. However, history shows that emergency policy measures could generate substantially higher growth rates, accelerating progress and increasing the likelihood of future hydrogen availability.

It has spurred a surge of enthusiasm in recent years and plays a key role in facilitating many net-zero emissions scenarios: green hydrogen and derived green fuels are based on renewable electricity and are produced through a process called electrolysis, splitting H2O water molecules into hydrogen and oxygen.

“Much of the debate and research around hydrogen has revolved around questions related to demand for suitable applications, markets and sectors. But so far no study analyzed the bottleneck of potential expansion pathways for electrolysis, a supply technology in its infancy that needs to undergo rapid innovation and deployment to unlock its potential for climate change mitigation,” lead author Adrian Odenweller of the Potsdam Institute for Climate Impact Research (PIK) said in a statement.

Today’s electrolyzers are mostly small and individually manufactured; however, global capacity must increase 6,000-8,000-fold by 2050 to contribute to climate-neutral scenarios compatible with the Paris Agreement. This dwarfs the 10-fold increase simultaneously required from renewable energy, which is readily available and cost competitive.

Using a computer simulation of energy technology diffusion and exploring thousands of possible worlds, the research team took a deep dive into the likelihood and feasibility of increasing electrolysis capabilities.

“The broad success of green hydrogen is by no means a given. Even with electrolysis capacities growing as fast as wind and solar, there is strong evidence of near-term scarcity and long-term uncertainty in terms of green hydrogen availability,” says Falko Ueckerdt, co-author of PIK.

“Both impede investment in hydrogen infrastructure and end uses, which reduces the potential of green hydrogen and jeopardizes climate targets. However, while this could make green hydrogen a risky bet from a policy perspective, historical analogues also suggest that emergency policy measures could encourage substantially higher growth rates, accelerating progress and increasing the likelihood of future hydrogen availability.”

According to the study, policies that trigger rapid deployment of electrolyzers providing gigawatt-scale capacities in the coming years could help unlock substantial innovation and scale effects and enable green hydrogen to meet demand in sectors inaccessible to direct electrification.