PARIS - This paper by OECD presents a value chain approach to identify priority areas for developing national hydrogen strategies, focussing on emerging and developing economies. The analysis highlights success factors for green hydrogen projects, based on eight case studies covering applications in industrial, transport and power generation sectors. The paper summarises the enabling conditions and financing solutions that can spur the green hydrogen market creation and growth.
Executive Summary
International organisations and think tanks, as well as global, regional and national-level industry initiatives,are increasingly emphasising the role of green hydrogen in aligning the global energy sector with a net-zero pathway. As of today, over 30 countries have developed, or are in the process of developing, national hydrogen strategies to facilitate their climate action plans and to take advantage of the social and economic co-benefits offered by the green hydrogen value chain. This Working Paper is meant to create discussion in support of shaping an agenda on green hydrogen for the OECD’s clean energy financing and investment work in emerging and developing economies. Drawing upon a large body of literature and using the green hydrogen value chain as a backdrop, it reflects on the opportunities to develop green hydrogen and its derivatives in emerging and developing economies, proposing a three-step approach.
•Understanding the value chain and overall country potential. The report highlights areas for consideration in the process of defining national hydrogen strategies by outlining the opportunities of various hydrogen usages. It provides a list of statements to support policymakers to carry out a preliminary self-assessment of their country’s potential to develop green hydrogen. It also underscores the expected growing importance of the trade of green hydrogen and its derivatives at a global scale and the role of international collaboration.
•Understanding the business cases and economics factors. After assessing a country’s potential and identifying its strength and blind spots along the green hydrogen value chain, an analysis of the benefits and risks, notably the parameters driving the costs, is a crucial step towards building robust business models and confirming suitable applications in a country. A checklist enables countries to pinpoint potential barriers to the creation of an enabling environment. Quantitative examples of green steel and green ammonia production underscore the importance of addressing the upstream, midstream and downstream components of the value chain.
•Identifying suitable policies to bridge the viability gap and develop the market. This Working Paper provides insights from case studies of green hydrogen projects, focusing mainly on emerging and developing countries, identifying commonalities and specificities of enabling market conditions and financing mechanisms that can foster the development of green hydrogen. Finally, it highlights how stakeholders can successfully initiate the growth of the green hydrogen market in their countries.The value chain approach and the empirical analysis support the proposal for policy instruments that can help emerging and developing economies to create and drive the growth of a green hydrogen market.
For the full paper, visit: https://www.oecd-ilibrary.org/docserver/53ad9f22-en.pdf?expires=1668085805&id=id&accname=guest&checksum=87CC0CA7BB2B77035C0EC2C9BC75B769
