A key part of a clean and secure energy future
Hydrogen can help tackle various critical energy challenges, including helping to store the variable output from renewables like solar and wind to better match demand. 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. It can also help improve air quality and strengthen energy security.
Near term, practical opportunities for policy action
Hydrogen is already widely used in some industries, but it has not yet realised its potential to support clean energy transitions.
Ambitious, targeted 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:
- Establish long-term signals to foster investor confidence
- Stimulate commercial demand for hydrogen in multiple applications
- Help mitigate salient risks, such as value chain complexity
- Promote R&D and knowledge sharing
- Harmonise standards and remove barriers
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. 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.
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. 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.