BAKU, Azerbaijan, Jan.20
By Leman Zeynalova – Trend:
Introducing hydrogen as an energy carrier can raise energy security risks, especially when it comes to internationally traded hydrogen and derivatives, Trend reports with reference to the International Renewable Energy Agency (IRENA).
“Hydrogen is expected to play a smaller role in a decarbonized energy system in 2050 than fossil fuels do presently. Therefore, the level of trade risk would be limited to a smaller number of sectors. Setting up infrastructure for hydrogen trade carries risks on both sides of the supply chain. Given the high capital intensity of hydrogen trade value chains, de-risking these investments will likely require large consortia, high levels of state involvement, and international co-ordination,” reads a report released by IRENA.
The agency notes that from the perspective of an exporter, revenue security is crucial.
“Without an assured stream of revenues, it is not possible to recoup the upfront capital expenses incurred to build hydrogen projects. Revenue must be sufficient to cover the costs of electrolysers (in the case of green hydrogen), natural gas reformers (in the case of blue hydrogen), solar and wind parks (for green hydrogen), gas reserve facilities (for blue hydrogen), and transport and storage infrastructure. Plans for hydrogen export projects have sprung up across Australia, the Middle East, North and Southern Africa and South America. Together, the plans behind those projects envisage the production of millions of tons of clean hydrogen and derivatives destined for global markets. These plans face an uncertain future, as global demand for clean hydrogen is only just emerging and competition for sales will be fierce. The list of countries that aspire to become hydrogen exporters is much longer than those planning imports,” says the report.
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