Global Energy Perspective 2023: Hydrogen outlook

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The Global Energy Perspective 2023 models the outlook for demand and supply of energy commodities across a 1.5°C pathway, aligned with the Paris Agreement, and four bottom-up energy transition scenarios. These energy transition scenarios examine outcomes ranging from warming of 1.6°C to 2.9°C by 2100 (scenario descriptions outlined below in sidebar “About the Global Energy Perspective 2023”). These wide-ranging scenarios sketch a range of outcomes based on varying underlying assumptions—for example, about the pace of technological progress and the level of policy enforcement. The scenarios are shaped by more than 400 drivers across sectors, technologies, policies, costs, and fuels, and serve as a fact base to inform decision makers on the challenges to be overcome to enable the energy transition. In this article, we explore how hydrogen could contribute to decarbonizing the energy system, uncertainties around hydrogen’s future role, and what it would take to set up a global hydrogen economy by 2050.

Clean hydrogen demand is projected to increase to between 125 and 585 Mtpa by 2050

Across scenarios, clean hydrogen demand is expected to reach 125-585 million tons per year by 2050.

Industry is projected to drive the majority of clean hydrogen uptake until 2030, followed by a wider uptake in new applications by 2050

Industry is expected to be the biggest driver of clean hydrogen demand until 2030; mobility could overtake industry by 2050.

Uptake in new applications depends on operating environment, infrastructure development, and relative competitiveness

There is a large range of uncertainty in the projected uptake of hydrogen in emerging sectors.

Infrastructure scale-up and technology advancements could be critical

The future hydrogen economy will likely require infrastructure scale up and tach advancements to meet demand.

Asia is projected to remain the region with the largest hydrogen demand to 2050

By region, APAC is projected to have the largest hydrogen demand in 2050, driven by demand in the chemicals sector from China and India.

Green hydrogen production is projected to be spread across regions, while blue hydrogen production is geography-specific

Green hydrogen supply uptake is expected to be similar across all regions, while blue production will be specific to certain geographies.

Clean hydrogen cost competitiveness is projected to vary between regions

By 2050, regions with production costs under $1.8/kg could export large volumes of hydrogen and hydrogen derivatives.

A global hydrogen trade could emerge to connect demand centers with resource-rich export hubs

By 2050, extensive and deep trade links could connect the globe.

Hydrogen is a versatile energy carrier that has the potential to play a significant role in decarbonizing the energy system. Hydrogen-based technologies and fuels can provide low-carbon alternatives across sectors. However, as of now, there is still a wide range of possible hydrogen pathways up to 2050 both in terms of hydrogen demand and supply, leading to uncertainty for organizations looking to enter the hydrogen market or to scale their operations.

Government and private sector support is projected to heavily affect hydrogen uptake. At the same time, future technological developments of alternatives (for instance, high-temperature electric furnaces, long-duration energy storage, and availability of biobased feedstock) could also create competition in some of the new applications for hydrogen and hydrogen-based fuels. Hydrogen companies may benefit from closely monitoring signposts on policies, the development of hydrogen-enabling infrastructure, and the cost-competitiveness of hydrogen-based technologies compared to other low-carbon alternatives as they chart their way forward.

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