Analysis of Global South's Green Hydrogen: Assessing Reality Beyond Excitement
The development of a sustainable green hydrogen economy, particularly in developing countries, is a promising yet complex endeavour. High production costs, insufficient demand, financing difficulties, and regulatory uncertainties are the current challenges that need to be addressed [1][3][4].
From an environmental perspective, green hydrogen, produced by electrolysis powered by renewable energy sources like solar and wind, is virtually emission-free at production. However, the cost of renewable electricity and the price of electrolyzers remain high and variable, affecting production economics and scalability [1][3]. For many Global South countries rich in solar or wind resources, balancing land and water use impacts is also crucial, as electrolysis requires substantial water input, which can be a constraint in water-scarce regions.
From a social perspective, challenges include economic affordability and accessibility, job creation and equitable growth, and energy justice and community impacts [1][3][4]. High upfront capital costs and expensive hydrogen production can limit local industrial uptake and consumer access without sustained subsidies or incentives. Ensuring local workforce development and inclusion, rather than relying on imported expertise and technology, is essential. Furthermore, hydrogen development should benefit local communities without adverse impacts or displacement, especially in rural or indigenous populations.
Opportunities for the Global South lie in leveraging abundant renewable resources to produce competitively priced green hydrogen and export clean energy or hydrogen derivatives to global markets, fostering economic diversification [2]. Green hydrogen can also be used to decarbonize hard-to-abate industries, enabling sustainable industrialization aligned with climate goals [3]. Promoting technological innovation and cost reductions through partnerships, subsidies, and scaling up electrolyzer manufacturing and deployment can further accelerate the transition to green hydrogen [2][5]. Aligning hydrogen strategies with broader social development goals such as job creation, skills training, and equitable energy access is equally important.
Sustained government policy support, international financing, and clear regulatory frameworks will be critical to overcoming current economic and operational barriers, especially in regions where market demand for hydrogen is still nascent or uncertain [1][4].
The potential for green hydrogen is significant, with the International Energy Agency seeing a potential of up to 700 million metric tons annually [6]. However, foreseeable demand is currently below EU and member state targets. For instance, the German Hydrogen Strategy (BMWK 2023) failed to enshrine civil society principles in the 2024 Import Strategy due to resistance from the Chancellor's Office [7].
In the United States, President Biden made "clean" hydrogen a pillar of the Inflation Reduction Act (IRA) [8]. Similarly, China is investing heavily in electrolysis with the goal of dominating the green hydrogen market. Pilot projects, regional clusters, and state-supported initiatives are prevalent in countries with sovereign wealth funds like Saudi Arabia, Oman, and the United Arab Emirates [1].
In conclusion, the development of a sustainable green hydrogen economy in the Global South faces economic, regulatory, and social challenges, but also offers significant environmental and socio-economic opportunities if supported by targeted policies and investments that address both production cost barriers and inclusive growth considerations.
References: [1] BloombergNEF (2020). The future of hydrogen: Perspectives for a decarbonized energy system. [Online] Available at: https://about.bnef.com/insights/the-future-of-hydrogen/ [2] International Renewable Energy Agency (IRENA) (2021). Hydrogen: A renewable energy perspective. [Online] Available at: https://www.irena.org/-/media/files/ias/2021/mar/hydrogen_a_renewable_energy_perspective_2021.pdf [3] International Energy Agency (IEA) (2021). The role of hydrogen in the clean energy transition. [Online] Available at: https://www.iea.org/reports/the-role-of-hydrogen-in-the-clean-energy-transition [4] United Nations Development Programme (UNDP) (2021). Green hydrogen: A pathway to sustainable industrialization in developing countries. [Online] Available at: https://www.undp.org/content/undp/en/home/librarypage/energy/sustainable-energy/green-hydrogen-a-pathway-to-sustainable-industrialization-in-developing-countries.html [5] European Commission (2020). A hydrogen strategy for a climate-neutral Europe. [Online] Available at: https://ec.europa.eu/info/strategy/priorities-2019-2024/europe-green-deal/actions/hydrogen-strategy_en [6] International Energy Agency (IEA) (2021). The role of hydrogen in the clean energy transition. [Online] Available at: https://www.iea.org/reports/the-role-of-hydrogen-in-the-clean-energy-transition [7] Clean Energy Wire (2023). German hydrogen strategy fails to enshrine civil society principles in 2024 import strategy. [Online] Available at: https://www.cleanenergywire.org/news/german-hydrogen-strategy-fails-enshrine-civil-society-principles-2024-import-strategy [8] White House (2021). Fact sheet: President Biden signs the Inflation Reduction Act into law. [Online] Available at: https://www.whitehouse.gov/briefing-room/statements-releases/2022/08/16/fact-sheet-president-biden-signs-the-inflation-reduction-act-into-law/
- In environmental science, the production of green hydrogen, driven by renewable energy sources such as solar and wind, could significantly mitigate climate-change effects, due to its virtually emission-free nature.
- The challenges that need to be addressed in transitioning to a green hydrogen economy include high production costs, insufficient demand, financing difficulties, and regulatory uncertainties – issues identified in environmental-science, business, finance, and general-news literature.
- The industry of green hydrogen is poised for growth, particularly in countries with abundant renewable energy resources, as highlighted in education-and-self-development and technology discussions.
- From a social perspective, accessibility, job creation, equitable growth, and energy justice are crucial considerations, as stresses in climate-change, energy, lifestyle, and business discourses indicate.
- In financing terms, sustained subsidies or incentives are key to making green hydrogen economically viable for developing countries, according to numerous industry, finance, and energy-related reports.
- Some nations rich in solar or wind resources, such as those in the Global South, must carefully consider the potential water-usage impacts of electrolysis, a concern raised in environmental, energy, and general-news discussions.
- With the potential for up to 700 million metric tons of green hydrogen annually, technology breakthroughs and cost reductions can enable broader adoption of this clean energy source, as debated in environmental-science, technology, and climate-change literature.
