BAKU, Azerbaijan, October 11. Low carbon hydrogen can play an important role in the future international competitiveness of Azerbaijan’s exports as the global markets strive for products with low carbon intensity, the World Bank (WB) said, Trend reports via WB’s “Azerbaijan: towards green growth” publication.
“Given the significant renewable resources, natural gas availability, Carbon Capture and Storage (CCS) potential, infrastructure and proximity to key markets, Azerbaijan could become an important producer of blue, green and turquoise hydrogen, jointly known as LCH, and its derivatives, and develop an LCH economy,” the research said.
According to the WB, green hydrogen has significant potential in countries with large renewable energy resources, such as Azerbaijan, and is expected to become competitive in scale and cost over time.
Priority actions suggested by the WB, for LCH production in Azerbaijan would include establishing national excellence centers or departments for operating the hydrogen industry, developing legal and regulatory framework for H2 production, transportation and storage, and developing consistent H2 standards covering quality, GHG intensity, safety, and technology.
In addition, the government needs to phase out direct fossil fuel subsidies and introduce new ones to help develop the blue H2, establish targets and incentives to move from fossil fuels to H2 in the industrial and transport sectors, and set up monitoring, verification and reporting systems, the report added.
The establishment of international cooperation to facilitate capacity building and knowledge exchange, as well as the signing of bilateral agreements with countries that will import H2, will boost demand and scale up the supply of H2, and eventually promote Azerbaijan as an LCH provider on the global arena, the WB said.
“The size of infrastructure investments required to develop an LCH economy will be huge but can be managed by developing supply-demand hydrogen hubs/clusters much like what’s being done in Europe and the US, and by initially using the existing gas infrastructure (by blending hydrogen into natural gas, and repurposing gas pipelines), before building a dedicated hydrogen infrastructure,” the report noted.
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