Today we release the latest in our line of introductions to 350 PPM relevant sectors of the economy, this time focusing on hydrogen. Given the breadth and potential importance of the subject matter, this is a more involved report than previous releases. We provide an extract below, and you can download the full report using the following link:
CLICK HERE FOR FULL REPORT: Sector Research: Hydrogen
Given a clearer picture of the consequences, climate change ambitions – certainly in the UK – are shifting towards the goal of limiting global warming to 1.5 ºC above pre-industrial levels, rather than 2 ºC. This goal dictates a global transition to net-zero energy-related CO2 emissions by 2050 at the latest.
Achieving this goal will be challenging. Current methods for the decarbonisation of energy – increased energy efficiency, switching to electricity from renewable energy sources rather than fossil fuels, and increased electrification – can, by wide agreement, only take us so far. In addition, these methods present significant challenges in their wider adoption.
In this report, we introduce how hydrogen, a clean, versatile and abundant element, currently used mostly in the production of chemicals, could help obviate or overcome some of these challenges. Hydrogen could do this by expanding into a role as a complementary energy carrier alongside zero-carbon electricity.
In this role, hydrogen produced from renewable and carbon-abated fossil fuel sources could help decarbonise certain end-use sectors, particularly those less suited to full decarbonisation with electricity, such as transport, heavy industry and heat for buildings. It could also help with the decarbonisation of the electricity supply, in part by enabling the integration of high levels of renewable energy.
Much of the technology needed to make this vision a reality exists today, but can it be scaled economically from today’s demonstration and early commercial ventures to mass market acceptance, or are there fundamental issues that will limit its uptake? Frankly, no one knows if hydrogen will become a ‘central pillar’ of our decarbonisation efforts, providing 18% of final energy demand globally by 2050, with associated revenue potential of $2.5 trillion a year, as suggested by the Hydrogen Council, a prominent hydrogen advocacy group. Regardless, given this potential, investors should be aware of hydrogen and the discussions surrounding it. This report provides a high-level overview of the topic.