IEA – Global Hydrogen Review, 2023

The IEA's Global Hydrogen Review 2023 highlights the significant potential for low-emission hydrogen production to grow by 2030. The number of announced projects for low-emission hydrogen production is increasing rapidly, with potential annual production reaching 38 Mt by 2030. However, cost challenges are currently impeding the deployment of these projects. China is taking the lead in electrolyser deployment, increasing its installed capacity from less than 10% of the global capacity in 2020 to over 30% in 2022. By the end of 2023, China's installed electrolyser capacity is expected to reach 1.2 GW, accounting for 50% of the global capacity. However, increasing equipment and financial costs pose a threat to project viability and the impact of government support. Efforts to stimulate low-emission hydrogen demand are lagging behind, with demand primarily concentrated in traditional applications such as industry and refining. Government actions have largely focused on supporting low-emission hydrogen production rather than demand. The private sector has started to adopt low-emission hydrogen through off-take agreements, but these efforts remain at a small scale. International cooperation initiatives aim to aggregate demand for low-emission hydrogen, but the impact of these initiatives is unclear and mainly focused on new applications rather than existing sectors such as chemicals and refining. Scaling up low-emission hydrogen use is crucial for enabling the nascent hydrogen trade, but progress on infrastructure development has been slow. Despite strong political momentum and an increasing flow of capital into the low-emission hydrogen sector, actual deployment is still limited, accounting for less than 1% of global hydrogen production and use. Regulation, certification, manufacturing expansion, and creating demand are key barriers to adoption that require strong policy action from governments across the entire value chain to overcome.