Nigeria watches as countries unveil projects for hydrogen economy

The hydrogen economy may be in its very early stages, but most progressive governments are already working to develop projects and bring costs down while Nigeria remains passive despite having a variety of resources to produce hydrogen.

Countries like Germany, Saudi Arabia, Qatar, Morocco, South Africa and even Oman have started making significant investments and leading projects in hydrogen fuel production, while Nigeria seems docile, save for the mention of hydrogen in the 2018 National Energy Policy.

These plans by different forward-thinking countries suggest how states are preparing for energy transition and positioning their countries to take advantage of growing global demand for hydrogen, especially green hydrogen which is made of water electrolysis using electricity from solar or wind, has been gaining momentum in recent years.

A new report by BloombergNEF’s 2021 indicates that nearly everything is set to double this year in the world of clean hydrogen, from electrolyser installations to the number of countries creating strategies to reduce cost and lower carbon emissions from energy-intensive industries.

Read also: Nigeria dithers as world’s largest oil region turns hydrogen hub

The report indicates that more than 40 countries have now published a hydrogen strategy or are developing one while more than 90 projects are being planned worldwide to use hydrogen in industry.

For instance, Germany said in May that it would fund 62 large-scale hydrogen projects with as much as $10 billion in federal and state funds as it aims to become the world’s leader in hydrogen technologies.

Even countries in the top oil-producing region in the world, the Middle East, are looking at ways to become hydrogen production and export hubs. Oman, the United Arab Emirates (UAE), and Saudi Arabia are betting on hydrogen for leadership in another energy market apart from oil exports.

In the United States, Secretary of Energy Jennifer Granholm launched in June the U.S. Department of Energy’s first Energy Earthshots Initiative, Hydrogen Shot, which seeks to reduce the cost of clean hydrogen by 80 percent to $1 per kilogram in one decade.

“Clean hydrogen is a game-changer. It will help decarbonize high-polluting heavy-duty and industrial sectors while delivering good-paying clean energy jobs and realizing a net-zero economy by 2050,” Secretary Granholm said.

Morocco also recently entered into a partnership with Germany to develop the first green hydrogen plant in Africa, while South Africa is working arduously to expand local knowledge in hydrogen technology.

“Nigeria needs a national strategy either through the production of hydrogen from fossil fuels as a short-term measure or developing a hydrogen infrastructure or ultimately clean production of hydrogen from renewable energy sources,” Ademola Adegun, an analyst in the oil and gas sector said.

Despite the growing momentum about hydrogen, there are still challenges.

“The reality is that this fuel faces significant challenges in scaling up in the global energy system,” a brief report by London-based World Energy Council (WEC) in collaboration with the Electric Power Research Institute (EPRI) and PwC said.

According to the WEC’s report, existing hydrogen demand scenarios show estimates for future use of the fuel vary between 6 and 25 percent of final worldwide energy consumption by 2050, or between 150 and 600 megatons by 2050, depending on how hydrogen will compete with other clean solutions such as battery storage.

“Despite the fact that many countries are looking at how to develop a hydrogen economy by becoming suppliers or charting pathways for hydrogen use in domestic industries, scaling up hydrogen still faces significant challenges,” the report found.

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