Prepared by energy consultant Advisian, the report states that due to falling prices of electrolysers and wind, solar energy, green hydrogen is set to become a cost effective fuel for the transportation industry by the end of this decade
A study commissioned by Clean Energy Finance Corporation, a think tank backed by the Australian government has found that green hydrogen is rapidly approaching cost competitiveness in the transport sector. The report has been prepared by energy consultant Advisian, and states that green hydrogen could become a cost effective source of fuel for heavy trucking, buses and remote power industries by the end of this decade.
In the past few years, several coalitions comprising of leaders across industries, sectors and the academia have been formed to actively promote research, innovation and development of a wide range of hydrogen-based solutions. One such coalition known as the HyDeal Ambition Initiative was formed early this year. The 30-member coalition has committed to bringing down the price of green hydrogen to €1.5/kg before 2030, making it equal to the price of hydrogen which is produced by burning fossil fuels.
The report outlines a bright future for green hydrogen by projecting that the cost of delivered green hydrogen is likely to go down by almost 40%. This means that it is likely that by the end of this decade, green hydrogen might be commercially available for as little as €2.21 per kilogram. The report goes on to state that currently, hydrogen is approaching price parity with petroleum products and may even displace natural gas. The lowering of prices could be in part because of the falling costs of electrolysers and the declining prices of solar and wind energy establishments.
This is not the first time that an energy research firm has projected about the promising viability of hydrogen as a fuel of the future. Early this year, Hydrogen Council commissioned McKinsey Corporation to prepare a report on hydrogen. McKinsey found that by 2030, hydrogen has the potential to become the most economically viable solution to low-carbon technologies across a wide variety of sectors. The areas of possible application include long-distance transportation, shipping, steel, cement and fertilizer production among more than 20 others.
Both reports are a theoretical validation of the global energy market’s immense interest in hydrogen. In less than a decade, hydrogen has attracted a total investment of more than $300 billion with more than 200 projects being rapidly deployed around the world. Governments around the world have also taken note of this unprecedented interest. 2021 began with governments of over 30 countries launching strategies for hydrogen production and application.