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Hydrogen Diplomacy: Egypt Calls for Global Coordination in Clean Fuel Market

Anela DoksoBy Anela Dokso25/09/20234 Mins Read
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In the ever-evolving landscape of global energy, hydrogen has emerged as a powerful contender in the race towards clean and sustainable fuels. At the forefront of this transition is Egypt, a nation with ambitious plans to harness the potential of hydrogen as a game-changer in the energy market. But Egypt’s vision goes beyond its borders; it calls for the establishment of a global entity akin to OPEC, one that can coordinate the fragmented hydrogen market and foster cooperation rather than competition.

Khaled Naguib, President of Egypt Hydrogen Company, recently shed light on the nation’s journey into the hydrogen arena. He highlighted that the global hydrogen market currently lacks cohesion, with individual countries pursuing their hydrogen initiatives independently. This fragmented approach, he argues, hinders market growth and restricts the widespread adoption of this clean fuel.

Addressing concerns regarding the production of hydrogen from water, Naguib emphasized that this clean fuel can be efficiently produced from seawater following desalination processes. The primary challenge currently lies in the high cost of electrolysis devices required to separate hydrogen from water.

According to Naguib, Europe is expected to lead the global demand for hydrogen in the coming years. Europe’s growing appetite for clean energy solutions is driven by various factors, including the energy crisis exacerbated by the COVID-19 pandemic and the Russian-Ukrainian war. These events have underscored the need for alternatives to traditional fossil fuels, making hydrogen a strategic choice.

But what led Egypt to embrace hydrogen as a cornerstone of its energy strategy? Naguib explained that several factors influenced this decision. As global supply chains for gas and fossil fuels faced disruptions due to the pandemic and geopolitical tensions, Western nations, including the European Union and the United States, began exploring alternatives. Hydrogen emerged as a compelling substitute for traditional fuels, and Egypt was poised to capitalize on this opportunity.

Egypt boasts abundant renewable energy resources, with ample sunshine and wind energy potential. The nation’s strategic geographical location, robust infrastructure, and skilled workforce further enhance its capability to become a hydrogen production hub. Egypt’s current production of ammonia, a critical component of hydrogen production, strengthens its position in the global hydrogen market.

Egypt’s foray into the hydrogen market promises substantial economic benefits. The hydrogen sector generates a multitude of direct and indirect job opportunities, spanning design, construction, and operation phases. Additionally, the hydrogen value chain extends to various industries, including fertilizer and iron production, positioning it as a versatile energy source.

Europe has taken a proactive stance in fostering hydrogen adoption. The continent has initiated the establishment of a hydrogen bank designed to support the production and consumption of hydrogen. Given the current high production costs of hydrogen compared to fossil fuels, the hydrogen bank aims to bridge the price gap, incentivizing producers and encouraging hydrogen adoption.

Naguib stressed that cooperation is preferable to competition in the hydrogen market, especially considering Europe’s pivotal role in driving hydrogen demand. At present, the hydrogen landscape is characterized by fragmentation and individual efforts. Unlike the oil sector, which benefits from the coordination of OPEC, the hydrogen sector lacks a unifying body.

However, Naguib envisions a future where cooperation prevails, akin to the solidarity and collaboration witnessed following the 1973 October War between Egypt and Israel. Cooperation would involve the exchange of data, coordinated production, streamlined marketing, and pricing strategies. While regional hydrogen blocs exist, such as those in the United States, Europe, and China, they differ significantly in terms of regulations, incentives, and other related aspects.

Egypt’s efforts in the hydrogen sector have not gone unnoticed. The nation has already entered into agreements with Hydrogen Europe to promote awareness and attract technology companies. Plans are underway to collaborate with the Egyptian Ministry of Petroleum and Mineral Resources to establish small hydrogen factories serving three-wheeled vehicles (tuktuks). Additionally, Egypt is eyeing a role in the growing sector of hydrogen-powered aviation, contributing to green tourism by offering green fuel options to aircraft.

As Egypt charts its course into the hydrogen future, the world watches with anticipation. Its call for global coordination in the hydrogen market signifies a commitment to shaping a sustainable energy landscape that benefits all nations. The transition from competition to cooperation in the hydrogen sector holds the promise of cleaner, more accessible energy for the world.

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