22 May 2024 | 14:30 UTC — Insight Blog
Bright spots for hydrogen project development emerge amid investment delays
Featuring Staff and Eric Yep
Energy transition highlights: Our editors and analysts bring you the biggest stories from the industry this week, from renewables to storage to carbon prices.
Clean hydrogen projects are finding a pathway to final investment decisions despite global headwinds, through careful renewable power procurement, matching hydrogen production with anchor offtake agreements and state support, while incumbent producers also have an advantage.
Low-carbon and renewable hydrogen project delays are well documented around the world, with policy uncertainty, cost inflation and difficulty securing competitive offtake agreements common barriers.
A small minority -- around 7% -- of announced global clean hydrogen projects have taken positive final investment decisions, data from S&P Global Commodity Insights showed.
Meanwhile, electrolyzer costs have risen 20%-45% since 2021, according to Commodity Insights analysts.
But there are bright spots, and concrete progress is being made around the globe, albeit at a slower pace than originally envisaged and than developers would like to see.
Editor’s picks
INTERVIEW: 'Show your homework', urge lawyers advising corporates on ESG claims
Companies need to be more circumspect when making claims about their environmental credentials, especially those based on carbon offsets which are facing a barrage of greenwashing accusations, lawyers from international legal firm Vinson & Elkins told S&P Global Commodity Insights.
New Zealand's ETS settings consultation fails to boost carbon market
New Zealand's consultation to update carbon auction price settings for its emissions trading scheme failed to provide certainty to the market, with the government's option to lower the auction floor denting market confidence and pushing prices down, sources said.
China on May 15 firmly opposed a move by the US to hike tariff rates on certain Chinese steel, aluminum and clean energy products, however, industry sources told S&P Global Commodity Insights that the tariffs may not have substantial impact on Chinese exports at least in the near term.
ADNOC delivers first bulk shipment of CCS-enabled clean ammonia to Japan’s Mitsui
Abu Dhabi’s state-owned oil company ADNOC has delivered the world’s first certified bulk commercial shipment of low carbon ammonia to Japan’s Mitsui for use in clean-power generation. The delivery marks the first shipment of low-carbon ammonia derived from hydrogen with carbon capture and storage (CCS), building on a series of demonstration cargoes shipped by ADNOC to customers in Asia and Germany.
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