IEA urges government to do more to promote hydrogen use

The International Energy Agency (IEA) urged governments on October 4 to do more to incentivise the creation of low-carbon hydrogen demand.

Most government policies focus on production of low-carbon hydrogen, while measures to increase demand for the fuel are receiving less attention, the IEA said in its Global Hydrogen Review 2021.

"Boosting the role of low-carbon hydrogen in clean energy transitions requires a step change in demand creation," the IEA said. "Governments are starting to announce a wide variety of policy instruments, including carbon prices, auctions, quotas, mandates and requirements in public procurement. Most of these measures have not yet entered into force. Their quick and widespread enactment could unlock more projects to scale up hydrogen demand."

The agency also called on more governments to introduce hydrogen strategies and roadmaps for development. Only 17 governments have so far released strategies, although a further 20 have said they are working on them. 

Governments also need to step up investments in hydrogen production and storage, the IEA said, noting that states and private investors had so far come up with only a quarter of the $1.2 trillion needed to develop and deploy hydrogen by 2030. And greater policy support is needed, it said.

"Providing tailor-made support to selected shovel-ready flagship projects can kick-start the scaling up of low-carbon hydrogen and the development of infrastructure to connect supply sources to demand centres and manufacturing capacities from which later projects can benefit," the IEA said. "Adequate infrastructure planning is critical to avoid delays or the creation of assets that can become stranded in the near or medium term."

Stronger support for innovation is also needed, and governments should push ahead with establishing the right certification, standardisation and regulation regimes.

"International agreement on methodology to calculate the carbon footprint of hydrogen production is particularly important to ensure that hydrogen production is truly low-carbon," the agency said. "It will also play a fundamental role in developing a global hydrogen market."