The International Energy Agency Releases “Global Hydrogen Review 2022”

Recently, the IEA (International Energy Agency) released the “Global Hydrogen Review 2022.” Spanning 280 pages, this report reviews, elaborates on, and summarizes hydrogen-related data as of June 2022, covering topics such as hydrogen demand, hydrogen production, hydrogen infrastructure, hydrogen trade, hydrogen policies, and investment and innovation. Hydrogen Hub (WeChat public account: h2-2005) has translated the most important insights from the report and compiled a selection of key charts for our readers.

By 2030, the installed capacity of electrolyzers will reach 124–240 million kilowatts.

Hydrogen demand continues to grow. In 2021, hydrogen demand reached 94 million tons, accounting for approximately 2.5% of global final energy consumption. Most of the growth in hydrogen demand comes from refining and industrial sectors. By 2030, the potential capacity of projects already announced will reach 3.5 million kilowatts.

In 2021, the production of low-carbon hydrogen was less than 1 million tons, almost entirely sourced from factories that use fossil fuels and employ CCUS technology to achieve low-carbon emissions. However, the number of low-carbon hydrogen projects is on the rise. If all currently under-construction projects are successfully completed, by 2030, low-carbon hydrogen production could reach between 16 million and 24 million tons. Of this total, 9 million to 14 million tons would be produced via electrolysis, while 7 million to 10 million tons would come from industrial by-product hydrogen. Specifically regarding electrolytic hydrogen production, by 2030, the installed capacity of electrolyzers is expected to reach between 124 million and 240 million kilowatts.

To fulfill governments’ climate commitments, annual production of low-carbon hydrogen will need to reach 34 million tons by 2030. To achieve global net-zero emissions by 2050, hydrogen production will need to reach approximately 100 million tons by 2030.

Expanding electrolyzer manufacturing capacity is crucial for developing a robust hydrogen supply chain. Currently, global electrolyzer production capacity stands at nearly 8 million kilowatts per year, and according to industry announcements, this could exceed 60 million kilowatts per year by 2030.

By 2030, the cost of green hydrogen will drop to as low as $1.3 per kilogram.

Compared to current energy prices, the cost of green hydrogen is already competitive with that of industrial byproduct hydrogen—particularly in regions rich in resources and with favorable conditions.

If the currently underway electrolyzer projects are successfully implemented and production capacity is expanded, by 2030, the cost of electrolyzers will drop by approximately 70% compared to today’s levels, enabling the cost of green hydrogen to reach between 1.3 and 4.5 U.S. dollars per kilogram.

In February 2022, the world’s first shipment of liquefied hydrogen was transported from Australia to Japan, marking a milestone in international hydrogen trade. As for the market, by 2030, annual hydrogen exports are projected to reach 12 million tons.

In terms of hydrogen infrastructure, using existing natural gas pipelines to transport hydrogen can reduce investment costs by 50% to 80%. Currently, several infrastructure projects are underway to retrofit existing natural gas pipelines for 100% hydrogen transport.

European countries are considering upgrading LNG terminals to accommodate trade formats that increasingly rely on ammonia. However, this upgrade poses significant technical challenges and has a substantial impact on costs.

From a policy perspective recently, the EU’s Important Projects of Common European Interest, the U.S. Inflation Reduction Act, and Germany’s H2Global initiative are expected to have a significant impact.

Hydrogen Demand and Hydrogen Production Capacity

Hydrogen Demand: In 2021, hydrogen demand grew by 5%, reflecting a recovery in global economic vitality. The table provided by the International Energy Agency features two sets of data each year: on the left is a bar chart showing the sources of hydrogen production, and on the right is a map illustrating the total hydrogen demand by country. As can be seen from the chart, from 2019 to 2021, China’s total hydrogen demand remained relatively stable while also being the region with the highest demand. In 2021, demand reached 28 million tons, an increase of 5% over 2020. North America ranked second, and the Middle East came in third, each with demand around 12 million tons. Europe’s demand exceeded 8 million tons.

Electrolytic Hydrogen Production Capacity: According to projections by the International Energy Agency, as the scale of individual electrolysis projects gradually expands, electrolytic hydrogen production capacity is expected to see a significant increase in 2022. Prior to 2021 (including 2021), most electrolytic hydrogen projects were below 10 megawatts; however, after 2021, the number of projects exceeding 10 megawatts increased substantially. In 2022, the International Energy Agency forecasts that projects ranging from 10 to 100 megawatts will become the mainstream. Yet after 2026, projects exceeding 1,000 megawatts will dominate new project development, reflecting an overall trend toward increasingly larger-scale projects.

In 2021, nearly 70% of existing production capacity was accounted for by alkaline electrolyzers, while proton exchange membrane electrolyzers made up about 25%. Solid oxide electrolysis technology also saw significant growth. By 2030, the total capacity for hydrogen production via electrolysis is expected to reach 115 gigawatts. China and Europe will remain the primary sources of electrolytic hydrogen. According to the International Energy Agency, electrolytic hydrogen production in North America is unlikely to see substantial progress by 2030. (Source: International Energy Information Network)