In 2050, will half of hydrogen be used in heavy industry and transportation?

PIE analysts and experts, citing data from the International Energy Agency (IEA), pointed out that in the scenario of achieving climate neutrality in 2050, global hydrogen demand will reach 528 Mt, of which 520 Mt should be sourced from low-carbon sources. This is more than a six-fold increase in demand compared to 2020. (90 Mt, 95 percent of which was sourced from fossil fuels).

"Fifty percent of hydrogen in 2050 is expected to be used in heavy industry - mainly in the production of steel and chemical products - as well as in the transportation sector." - PIE claims.

According to the IEA's scenario, 60 percent of low-carbon hydrogen (312 Mt) could be obtained in 2050 through electrolysis, in which the electricity used to produce hydrogen would come 95 percent from RES, and only 3 percent from nuclear power plants.

"In such a scenario, the annual production of purple hydrogen, i.e. extracted by electrolysis using nuclear-generated electricity, also called pink, purple or red hydrogen, would be about 9 Mt per year, consuming between 351 TWh and 435 TWh (44.5-55 GW of installed capacity," according to the experts.

According to IEA projections, 40 percent of low-carbon hydrogen in 2050 is expected to be produced directly from natural gas using CO2 capture, transport, utilization and storage (CCUS) technologies. In contrast, 2 percent of the hydrogen created by electrolysis is to be produced using electricity created from fossil fuels using CCUS. A total of 8 Mt of carbon-intensive hydrogen translates into 222 Mt of hydrogen produced using fossil fuels (including 925 billion cubic meters of natural gas, which is expected to account for 50 percent of total global demand for the fuel).

According to analysts, increasing the production of purple hydrogen from 9.3 Mt to 23.6 Mt would make it possible in 2050 to completely eliminate carbon-intensive hydrogen and use electricity from fossil fuels by electrolysis (the "electrolysis without CCUS" scenario). This, however, according to experts, would require the construction of an additional 68-84 GW of installed nuclear power capacity.

More difficult, however, may be the process of eliminating hydrogen extracted directly from natural gas using the CCUS process, as lowering the projected share of global hydrogen production from 40 percent to 35 percent would require an increase in installed nuclear power capacity by more than double that of the "electrolysis without CCUS" scenario and by more than five times that of the baseline IEA scenario. As a result, according to PIE, increasing purple hydrogen production by 1 Mt per year on average would require the construction of between 4.8 GW and 5.9 GW of capacity.

Source: Polish Economic Institute