Global Green Hydrogen Projects Face Setbacks Due to Costs and Demand
Green hydrogen developers globally are scaling back investments and scrapping projects due to elevated production costs and weak demand. In Europe, LEAG postponed indefinitely plans for a major green energy hub in eastern Germany, ArcelorMittal shelved a €2.5 billion plan to convert two plants in Germany to green hydrogen despite €1.3 billion in public subsidies, and Iberdrola reduced its 2030 target from 350,000 to 120,000 tons/year. Other European companies like Repsol, BP, Shell, Equinor, and Neste have also cut back or cancelled projects, such as Shell and Equinor scrapping low-carbon hydrogen plants in Norway. In Australia, Origin Energy exited a potential hydrogen development in the Hunter Valley Hydrogen Hub, Trafigura abandoned a A$750 million plant at Port Pirie, and Fortescue cut back its 15 million ton target by 2030. In the U.S., Hy Stor Energy cancelled over 1GW of electrolyser capacity with Nel ASA, and Air Products is looking to cancel a 35-ton-per-day facility in New York. In Asia, Kawasaki Heavy Industries walked away from a coal-to-hydrogen project in Australia. These setbacks raise concerns about meeting emissions targets and highlight the economic challenges facing the sector.
Key Takeaway: The green hydrogen industry is experiencing significant setbacks globally, with many projects being cancelled or postponed due to economic viability concerns, which could impact the transition to cleaner energy sources.
Relevance: This story involves top companies like Shell, Air Products, and Nel ASA, as well as emerging players like Trafigura, and reflects challenges in projects like the Western Green Energy Hub in Australia, amid government policies in the U.S., EU, and Australia struggling with investment trends like green bonds and PPPs.
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