Significant divergences are emerging across countries and regions, as national hydrogen strategies reveal varying attitudes towards hydrogen’s role in energy transitions. This signals a need to embrace diversity – eliminating a one size fits all mindset – and enable differing technologies and use cases to be explored.
This Working Paper focuses on exploring the national hydrogen strategies being increasingly published globally to support hydrogen development, and further explores the different hydrogen stories emerging between countries and regions.
Global state of play of national hydrogen strategies
The development of a “hydrogen economy” is still at its early stages, though there is broadening global interest and support.
To date, 12 countries and the European Union (EU) have published their national hydrogen strategies, with 9 published within the last year alone.
Priority sectors
Differing country contexts mean that the sectoral priorities vary significantly across countries with no global priority sector yet emerging. Focal areas range from heavy duty and long-distance transport applications (buses, trucks, etc.) to carbon-intensive industrial sectors that already require and consume fossil fuel derived hydrogen (refineries, fertilisers, steel).
Japan and South Korea: Developing hydrogen economies
Japan and South Korea share several sectoral priorities, notably targeting the power sector with Japan already having targets for electricity production from hydrogen. In South Korea, the government is exploring central power generation along with fuel cell use by decentralised systems in homes and buildings and has set ambitious targets.
Both countries are also looking at the transport sector with an emphasis on fuel cell vehicles (FCVs) to be deployed in the domestic markets with targets for light vehicle use.
Australia: Export focus
In contrast, the Australian strategy places stronger focus on hydrogen production and export while also considering its own use in transport, focusing on heavy-duty and long-distance transport, and the large-scale production of clean ammonia.
Europe: Decarbonising industrial and transport sectors
In Germany, the emphasis is on chemical, petrochemicals and steelmaking industries together with a focus on heavy-duty vehicles such as military vehicles, haulage and buses.
France is focusing on replacing carbon-based hydrogen in existing industrial sectors (e.g., refining, chemistry, agribusiness) while also looking to pilot projects in the maritime and aviation sectors and seeking to be a key producer of electrolysers.
In the Netherlands, the government is considering the development of a hydrogen infrastructure to connect the different users.
Norway is cautious about significant clean hydrogen production due to the notable infrastructure costs but is exploring potential solutions, such as producing hydrogen close to customers and transporting the CO2 back to Norway for storage.
Chile and Canada: Producing, consuming and exporting clean hydrogen
In the Americas, Chile and Canada both aim to develop local supply and demand, before considering export in the mid-term.
Chile has excellent renewable energy conditions, therefore its immediate aim is to replace imported ammonia with locally produced green ammonia and grey hydrogen with green hydrogen in oil refineries.
On the other hand, Canada, a major hydrocarbon exporter, sees short term opportunities in transport where mature technology readiness is high with fuel cells expected to be deployed in road haulage, rail, and shipping.
Policy tools
To enable hydrogen within their energy systems, countries are considering a wide variety of policy instruments and tools with some particularly innovative measures.
Vision setting
Publishing a national strategy or roadmap can be an important step for setting out a vision for stakeholders. In doing so, the strategies provide visibility to market players on the policies, regulations and incentives to achieve the ambition.
Enabling switching to hydrogen
- Direct financial support
Hydrogen technologies are in early stages of commercialisation, with many strategies targeting direct public and private investments to support pilot projects to achieve economies of scale. The investment required could be worth $11.7 trillion by 2050.
According to the Hydrogen Council, a $50 billion gap and 65 GW of electrolyser capacity needs to be bridged by 2030 to reach a breakeven between grey and renewable hydrogen.
Several governments have pledged direct public funding to 2030 to develop their national hydrogen industries or economy:
- Japan has committed some $1.5 billion to support zero-emission hydrogen production and to develop distribution infrastructure;
- France plans to invest €7 billion by 2030 targeting industrial decarbonisation, heavy duty transport, and R&D;
- Germany has adopted a “package for the future” with €7 billion to speed up the market rollout of hydrogen technologies nationally, complemented by €2 billion to foster international partnerships.
Mobilising private funding is also critical and can be combined with public funds. For instance, the Dutch government aims to invest up to €338 million in green hydrogen projects in addition to planned investments of €9 billion of which most are private, in northern Netherlands to develop an integrated hydrogen ecosystem.
- Financial incentives
Tax policy is an effective instrument to incentivise switching from fossil fuels to new energy carriers. Where emissions trading schemes are in place, a higher carbon price could be a particularly effective incentive to enable hydrogen. A carbon tax is another option being considered, for example Norway plans a CO2 tax increased annually by 5% until 2025.
Subsidies can also help encourage hydrogen demand by targeting priority sectors identified. In Portugal, hydrogen production associated with existing solar and wind power plants is promoted through a “purchase” mechanism by which feed-in tariffs are replaced with incentives for hydrogen production.
Creating the conditions for market development
- What is the role for legislation and regulation today?
Legislative and regulatory measures are yet to be fully developed and instead the focus so far is on rapidly enabling hydrogen projects by simplifying the existing frameworks as well as reducing potential barriers and administrative burdens.
- Standardisation is needed but maybe not yet
Standards and certification mechanisms can help harmonise processes important for hydrogen development. Hydrogen safety is frequently mentioned as a priority field for standardisation with standards for industry and transport sectors.
- Hydrogen colour debate is an obstacle to uptake
The existing strategies cite divergent forms of hydrogen based on colour or carbon intensity of production for 2030 and 2050. The choice of hydrogen production methods depends largely on the resources available and existing energy systems within each country, as well as the policy objectives being pursued.
Facilitating international hydrogen markets
Developing hydrogen as an energy vector will also require building an international hydrogen market to enable the cost effective production and trade of hydrogen. To help achieve this, various countries are developing bilateral agreements to coordinate R&D programmes, explore harmonising standards and encourage the emerging global hydrogen trade.
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