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The Future of Hydrogen Chapter 6: Policies to boost momentum in key value chains Chapter 6: Policies to boost momentum in key value chains • Hydrogen is already widely used in some industries, but it has not yet realised its potential to support clean energy transitions. Hydrogen can be produced from many sources and it could play a very important and versatile part in a clean energy future. There have been numerous successful government-backed projects in recent years; now it is time for policy to help stimulate commercial demand for cleaner hydrogen and for proponents to demonstrate they can build on the current unprecedented momentum. • Ambitious, pragmatic and near-term action is needed to further overcome barriers and reduce costs. The 2030 time horizon will be crucial for the wider deployment of hydrogen in the longer term. There is scope to build on hydrogen’s current uses by scaling up low-carbon production and fostering innovation. In parallel, demand for hydrogen in new sectors and applications can be created and markets connected. • Five smart policy actions are needed to 2030: (1) establish long-term signals to foster investor confidence; (2) stimulate commercial demand for hydrogen in multiple applications; (3) help mitigate salient risks, such as value chain complexity; (4) promote R&D and knowledge sharing; and (5) harmonise standards and remove barriers. • Four value chains offer springboard opportunities to scale up hydrogen supply and demand, building on existing industries, infrastructure and policies: • Make industrial clusters the nerve centres for scaling up the use of clean hydrogen. Growing hydrogen demand in major industries offers the opportunity to create hubs that bring down the cost of low-carbon hydrogen pathways and kick-start new sources of demand. Coastal industrial clusters, co-located near ports, are particularly attractive, • Use existing gas infrastructure to help boost low-carbon hydrogen supply and make the most of a reliable source of demand. Even 5% blending would create large new hydrogen demand; 100% hydrogen enables deep emissions reduction for the long term. • Give focused support to those transport options where hydrogen has most to offer. This could make fuel cell vehicles more competitive and promote the development of core infrastructure. Existing 2030 government targets require 2.5 million fuel cell vehicles on the road and 4 000 refuelling stations. Such a scale-up could reduce fuel cell costs by 75%. • Kick-start the first international shipping routes for hydrogen trade. Lessons from the successful growth of the global LNG market can be leveraged. International hydrogen trade needs to start soon if it is to make an impact on the global energy system. PAGE | 167 IEA. All rights reserved.PDF Image | The Future of Hydrogen 2019
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