Research Report

Electrolysers are a critical technology for the production of low-emission hydrogen from renewable or nuclear electricity. Electrolysis capacity for dedicated hydrogen production has been growing at an accelerated pace for some years. The past year has been a record year of electrolysis deployment, with more than 200 MW of capacity entering operation, a threefold increase on 2020. Total installed capacity has reached 0.5 GW and is expected to grow to over 1 GW by the end of 2022.

Hydrogen demand reached 94 million tonnes (Mt) in 2021, recovering to above pre-pandemic levels (91 Mt in 2019), and containing energy equal to about 2.5% of global final energy consumption. Most of the increase came from traditional uses in refining and industry, though demand for new applications grew to about 40 thousand tonnes (up 60% from 2020, albeit from a low base)

Hydrogen and its derivatives should play an important role in the decarbonisation of those sectors where emissions are hard to abate and alternative solutions are either unavailable or difficult to implement, such as heavy industry, shipping, aviation and heavy-duty transport.

Hydrogen as a clean energy vector still has significant progress to make to get on track with the Net Zero Emissions by 2050 Scenario. In 2021 hydrogen demand was almost entirely met by unabated fossil fuel-based hydrogen. The production of low-emission hydrogen was around 0.6 Mt in 2021 (less than 1% of global hydrogen production). But a significant number of projects are under development, which are expected to increase output faster in the short term.

The Breakthrough Agenda was launched by 45 world leaders at COP26 and is a commitment to work together this decade to accelerate innovation and deployment of clean technologies, making them accessible and affordable for all this decade. To kick start this Agenda, countries endorsed Breakthrough goals to make clean technologies and sustainable practices more affordable, accessible and attractive than their alternatives by 2030 in the power, road transport, steel, hydrogen and agriculture sectors.