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PROJECT CARS 3 STEAM KEY FULL

Hydrogen can help tackle various critical energy challenges. It offers ways to decarbonise a range of sectors – including long-haul transport, chemicals, and iron and steel – where it is proving difficult to meaningfully reduce emissions.

PROJECT CARS 3 STEAM KEY FULL

The pragmatic and actionable recommendations to governments and industry that are provided will make it possible to take full advantage of this increasing momentum. It concludes that now is the time to scale up technologies and bring down costs to allow hydrogen to become widely used. The report finds that clean hydrogen is currently enjoying unprecedented political and business momentum, with the number of policies and projects around the world expanding rapidly. The time is right to tap into hydrogen’s potential to play a key role in a clean, secure and affordable energy future. At the request of the government of Japan under its G20 presidency, the International Energy Agency (IEA) has produced this landmark report to analyse the current state of play for hydrogen and to offer guidance on its future development. Near term, practical opportunities for policy action Furthermore, governments – at regional, national or community levels – will benefit from international cooperation with others who are working to drive forward similar markets for hydrogen.

Regardless of which of these four key opportunities are pursued – or other value chains not listed here – the full policy package of five action areas listed above will be needed. Governments and other stakeholders will be able to identify which of these offer the most near-term potential in their geographical, industrial and energy system contexts. The IEA has identified four value chains that offer springboard opportunities to scale up hydrogen supply and demand, building on existing industries, infrastructure and policies. Ambitious, targeted and near-term action is needed to further overcome barriers and reduce costs. Hydrogen is already widely used in some industries, but it has not yet realised its potential to support clean energy transitions. Ammonia could also be used in coal-fired power plants to reduce emissions.

In power generation, hydrogen is one of the leading options for storing renewable energy, and hydrogen and ammonia can be used in gas turbines to increase power system flexibility.

In buildings, hydrogen could be blended into existing natural gas networks, with the highest potential in multifamily and commercial buildings, particularly in dense cities while longer-term prospects could include the direct use of hydrogen in hydrogen boilers or fuel cells.

Shipping and aviation have limited low-carbon fuel options available and represent an opportunity for hydrogen-based fuels.

In transport, the competitiveness of hydrogen fuel cell cars depends on fuel cell costs and refuelling stations while for trucks the priority is to reduce the delivered price of hydrogen.

Virtually all of this hydrogen is supplied using fossil fuels, so there is significant potential for emissions reductions from clean hydrogen.

Hydrogen use today is dominated by industry, namely: oil refining, ammonia production, methanol production and steel production.

Gas importers like Japan, Korea, China and India have to contend with higher gas import prices, and that makes for higher hydrogen production costs. Low gas prices in the Middle East, Russia and North America give rise to some of the lowest hydrogen production costs.

The production cost of hydrogen from natural gas is influenced by a range of technical and economic factors, with gas prices and capital expenditures being the two most important.įuel costs are the largest cost component, accounting for between 45% and 75% of production costs. Gas is followed by coal, due to its dominant role in China, and a small fraction is produced from from the use of oil and electricity. This accounts for about 6% of global natural gas use.

Natural gas is currently the primary source of hydrogen production, accounting for around three quarters of the annual global dedicated hydrogen production of around 70 million tonnes. Hydrogen can be extracted from fossil fuels and biomass, from water, or from a mix of both.