Northwest European Hydrogen Monitor 2024

INTERNATIONAL ENERGY AGENCY The IEA examines the full spectrum of energyissues including oil, gas and coal supply anddemand, renewable energy technologies,electricity markets, energy efficiency, access toenergy, demand side management and muchmore. Through its work, the IEA advocatespolicies that will enhance the reliability,affordability and sustainability of energy in its 31member countries,13association countries andbeyond. SpainSwedenSwitzerlandRepublic of TürkiyeUnited KingdomUnited States IEA member countries: AustraliaAustriaBelgiumCanadaCzech RepublicDenmarkEstoniaFinlandFranceGermanyGreeceHungaryIrelandItalyJapanKoreaLithuaniaLuxembourgMexicoNetherlandsNew ZealandNorwayPolandPortugalSlovak Republic The European Commissionalso participates in the workof the IEA This publication and any map included herein arewithout prejudice to the status of or sovereigntyover any territory, to the delimitation ofinternational frontiers and boundaries and to thename of any territory, city or area. IEA association countries: ArgentinaBrazilChinaEgyptIndiaIndonesiaKenyaMoroccoSenegalSingaporeSouth AfricaThailandUkraine Abstract This is the second edition of the Northwest European HydrogenMonitor. It provides an annual update of low-emissions hydrogenmarket developments in Northwest Europe, and is the result ofcollaboration among the countries involved in the Hydrogen Initiativeofthe Clean Energy Ministerial(CEM-H2I)workstream entitled“Roundtable on the North-West European Region” and the hydrogenworking group of the Pentalateral Forum. Northwest Europe is at the forefront of low-emissions hydrogen1development. This region accounts for around half of Europe’s totalhydrogen demand, and it has vast and untapped renewable energyand carbon storage potential in the North Sea. It also has a well-developed, interconnected gas network which could be partiallyrepurposed to facilitate the transmission and distribution of low-emissions hydrogen from production sites to demand centres. Thecountries analysed in this Monitor are Austria,Belgium,Denmark, France, Germany, Luxemburg, the Netherlands, Norway,Switzerlandand the United Kingdom.Market monitoring isaccompanied by regular dialogues with key stakeholders to facilitatethe exchange of information and data collection. The development of low-emissions hydrogen in Northwest Europecould gradually scale up in the short- to medium-term. NorthwestEuropean countries now have the ambition to develop up to 30 to 40gigawatts (GW) of electrolyser capacity by 2030. However, most low-emissions hydrogen projects are currently in the early stages ofdevelopment.Their success will depend to a large extent onsupportingpolicies and regulatory frameworks,with continuousmonitoringof progress.The cost-efficient development of low-emissionshydrogen markets will also necessitate a regionalapproach that maximises existing synergies among national markets. Table of contents Executive summary .....................................................................................5Hydrogen policies and regulation ............................................................10Subsidy schemes and support mechanisms ..........................................28Hydrogen demand......................................................................................43Hydrogen supply........................................................................................53Production costs and price discovery.....................................................63Hydrogen trade...........................................................................................69Infrastructure..............................................................................................78Annex ..........................................................................................................93 Executive summary Low-emissions hydrogen can play a significant role in decarbonisingexisting gas and energy systems and will be critical to the countries’efforts to meet their energy and climate targets. In addition to itsenvironmental benefits, low-emissions hydrogen can help reducereliance on fossil fuel imports in the medium-term, bolstering energysecurity. necessary impetus and guidance for the development of hydrogenmarkets. Since Russia’s invasion of Ukraine, several Northwest Europeancountries have doubled their hydrogen production targets, and othersare considering increases. The majority of the countries in the regionadopted production targets for electrolytic hydrogen, while Norwayoptedfor a technology-neutral approach.Altogether,NorthwestEuropean countries now have ambition to develop as much as 30 to40 gigawatts (GW) of electrolyser capacity by 2030. Nonetheless,recent market developments, inflation and cost increases might drivecountries to revise their targets. In general, the focus has been onupscalinghydrogen production in many countries,though theattention is also rapidly shifting to stimulating demand