Hydrogen to lead to emergence of new centers of geopolitical influence – IRENA

Oil&Gas 17 January 2022 14:05 (UTC +04:00)
Hydrogen to lead to emergence of new centers of geopolitical influence – IRENA

BAKU, Azerbaijan, Jan.17

By Leman Zeynalova – Trend:

Hydrogen will change the geography of energy trade and lead to emergence of new centers of geopolitical influence built on the production and use of hydrogen, as traditional oil and gas trade declines, Trend reports with reference to the International Renewable Energy Agency (IRENA).

“Because changes in economic relations can affect political ties (and vice versa), the emergence of markets in hydrogen and other clean fuels could bring about shifts in political relations and alliances between countries. Trade relations in oil and gas markets have largely been shaped by geology: hydrocarbon reserves are concentrated in a limited number of countries. Meanwhile, 80 percent of the world’s population lives in countries that are net importers of fossil fuels. By contrast, every country has renewable resources, although the strength of the wind and the quality of solar irradiance do vary around the world, and other renewables like hydropower or geothermal energy are more prevalent in some locations,” IRENA said in its latest report.

The agency believes that since renewable energy is ubiquitous, countries may gain the flexibility to choose preferred trading partners in the clean fuel markets of the future.

“However, the ability of countries to turn renewable potential into energy production depends on their industrial capacities and on the intellectual property underpinning innovation in the renewables sector. These capacities are relatively concentrated in a few countries. By implication, most countries are dependent on imports of PV panels, wind turbines, and other equipment from a relatively small set of countries. Therefore, trade relations in renewable energy are, to a large extent, shaped by national industrial policies,” says IRENA.

The report says that hydrogen trade flows may also raise new strategic considerations.

“As some countries and regions begin to import hydrogen in large quantities, the strategic importance of exporting countries will grow. New hydrogen production centres and shipping routes will also inform strategic planning by security and defence organisations. Opportunities will arise to shape the nascent hydrogen market to advance sustainable development. Germany, for example, has already engaged several African countries to explore and develop a hydrogen economy that makes use of the continent’s resource potential to support sustainable economic development,” said the agency.


Follow the author on Twitter: @Lyaman_Zeyn