ICIS has released the industry’s first hydrogen price assessments, which are based on the current value of renewable power.
Accurate and reliable pricing instruments aligned to net zero objectives are necessary for investors, policy makers, and participants in the hydrogen industry to make the €500 billion in investments called for by the European Commission’s hydrogen strategy a reality.
ICIS’s assessments of renewable hydrogen in Europe cover technologies and places that have been embraced by the market. These assessments are the result of “extensive consultation” with stakeholders in Europe’s energy market. Using ICIS’s multi-commodity energy analysis and Pexapark’s cost projections for long-term PPAs, Pexapark produces the aforementioned valuations.
These PPAs are anticipated to play a pivotal role as the principal source of renewable power for electrolytic hydrogen generation. Therefore, during the early stages of the market’s growth, PPA-based hydrogen pricing is the closest depiction of fair value for renewable hydrogen.
When it comes to creating renewable hydrogen, the European Union and the United Kingdom have strict regulations that the ICIS European renewable hydrogen assessments are the first market-based evaluations to meet (Renewable Fuels of Non-Biological Origin).
Participants can feel secure making long-term investment decisions, engaging in bilateral discussions, and coping with volatility based on these hydrogen pricing assessments because they accurately reflect the business environment facing renewable hydrogen projects.
