BAKU, Azerbaijan, June 2
By Leman Zeynalova – Trend:
Despite setbacks to some projects and near-term uncertainty about its market growth, hydrogen is perhaps unique among fuels in that its prospects are stronger in mid-2021 than before the COVID-19 pandemic, Trend reports citing the International Energy Agency (IEA).
“This outcome rests in part on the reliance of hydrogen projects on government grant funding, for which plans have been markedly expanded in economic recovery plans around the world. Nine countries plus the European Union published hydrogen strategies or roadmaps in 2020 and one so far in 2021, with nearly twice this total currently under development. Although current production and consumption are modest, expectations for the near-term expansion of low-carbon hydrogen4 are higher than ever. Spending in the four areas of project planning, project completion, equipment manufacturing and equity purchases were all at record levels in 2020. Capital investment for low-carbon hydrogen is gaining momentum, with the electrolysers coming online in 2020 alone representing nearly USD 70 million,” reads the IEA report.
Project completions in the area of water electrolyser installations for energy purposes reached an estimated 65 MWe globally in 2020, according to the IEA.
“While this was far below the 140 MWe that project developers at the start of 2020 were aiming to commission, it was nonetheless more than double 2019 levels. Vehicle fuelling and industrial applications led the intended uses of hydrogen from these electrolyser projects. Much of the focus in Europe has turned to industrial applications, including the steel and refining sectors, as early markets for captive low-carbon hydrogen production. In Japan, the power sector is receiving renewed attention for hydrogen as a means of electricity storage and replacing coal and natural gas with ammonia and hydrogen. However, at 50 percent, the share of electrolysers installed for transport applications was at its highest point since 2010 due to the expansion of this type of project in China. Several hundred MWe of electrolysers are currently under construction or seek financial close for an announced commissioning before the end of 2021. Although delays can be expected for some projects, orders have recently been placed for delivery of some large electrolysers in 2021 and 2022, notably a 20 MWe plant for fertiliser production in Spain, a 24 MWe plant for chemicals manufacture in Germany and a 20 MWe plant for a refinery in Denmark. As in 2020, developments in China will play a major role in determining the overall level of investment. Not all of these electrolysers are expected to produce exclusively low-carbon hydrogen, however, with the majority anticipated to run on grid electricity, at least initially,” says the report.
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