New research from Wood Mackenzie shows that falling costs and growing project pipelines will ensure the 2020s are the “decade of hydrogen”. The executive summary of the report can be downloaded here.

Hydrogen production costs: is a tipping point on the horizon examines the production costs of green, blue, grey and brown hydrogen from 2020 to 2040. Dynamic pricing was utilised to assess the competitiveness of green with fossil generation. The analysis was also expanded to include both PEM and Alkaline electrolyzers, different deployment sizes, different capex assumptions, plus added Saudi Arabia given the activity in solar and grey hydrogen markets there.

Key findings from the report include:

• Green hydrogen costs will fall by up to 64% by 2040.

• Over the past decade, global demand for hydrogen has only grown by 28%, peaking in 2020 at 111.7 million metric tons or 320Mtoe.

• The top 10 countries account for 70% of global hydrogen demand. China and the United States each account for 21% and 19% of demand, respectively. Refining and ammonia dominate two-thirds of all demand uses. Despite the continued discussion on mobility, it is a miniscule share of the market.

• While a few countries and sectors constitute the majority of 2020 global demand, 85 countries require hydrogen. However, individually, 61 countries make up less than 1% of global demand. This shows the potential to make in-roads in many markets at low stage usage.

• Global production of hydrogen is almost exclusively produced by hydrocarbons. Grey, brown and black hydrogen make up a combined 99.6% of global production. So, although there is a tremendous amount of hype regarding green hydrogen, it barely registers across the full value chain for hydrogen’s uses.

More details can be found here.