Seven companies, including Orsted and Iberdrola, have launched a global partnership that aims to halve the cost of green hydrogen to below $2 a kilogram and increase deployment 50-fold by 2026.
The Green Hydrogen Catapult, which also includes ACWA Power, Envision, CWP Renewables, Snam and Yara as its founder members, is targeting deployment of 25GW of the gas through to 2026.
The partners said that recent analysis suggests a $2/kg price represents a potential tipping point that will make green hydrogen and its derivative fuels the energy source of choice across multiple sectors, such as steel and fertiliser production, power generation and long-range shipping.
Investment of about $110bn will be needed to reach the goals, delivering more than 120,000 jobs, the Catapult added.
The companies will work toward the target by developing project capacity, supporting the design of specific tools to solve early market challenges, and sponsoring targeted collaboration to accelerate access to clean air, creation of green jobs, supply chain resilience, and economic growth using green hydrogen.
Rocky Mountain Institute, a global non-profit think-and-do-tank, will facilitate the initiative alongside the seven partners.
The initiative also invites committed businesses with an aligned vision and gigawatt-scale projects under development, as well as investors, customers, and city and regional governments to participate in the scheme.
It aims to align the production and use of green hydrogen with a trajectory that displaces fossil fuels at a rate consistent with achieving net zero global emissions by 2050, and limiting global temperature increases to 1.5 degrees Celsius.
ACWA Power chief executive Paddy Padmanathan said: “Having led the race to deliver photovoltaic energy at well-below $0.02 a kilowatt-hour, in certain geographies, we believe the collective ingenuity and entrepreneurship of the private sector can deliver green hydrogen at less than $2 per kilogram within four years.
“From an industry perspective, we see no technical barriers to achieving this, so it’s time to get on with the virtuous cycle of cost reduction through scale up.”
Snam chief executive Marco Alvera said: “Scaling up green hydrogen using existing infrastructure will be crucial to reaching climate goals.
“We believe that this new ‘coalition of the willing’ composed of leading companies in the private sector, with expertise, commitment and confidence in hydrogen’s potential, will play an important role in fostering cooperation and help to deliver the projects necessary to bring green hydrogen costs to the $2/kg tipping point even sooner than expected.”