The global clean hydrogen project pipeline is experiencing a surge in growth and maturity, according to the Hydrogen Council’s latest analysis of over 1,500 projects worldwide. The number of projects reaching final investment decision (FID) has skyrocketed, indicating a strong commitment from industry players. However, the pace and scale of deployment need to accelerate dramatically to effectively contribute to achieving global climate goals.
The Hydrogen Insights 2024 report, released today and co-authored by McKinsey & Company, highlights this dynamic shift. Since 2020, the global project pipeline has expanded sevenfold, from 228 projects to 1,572 projects as of May 2024. This growth is accompanied by a maturation process, with a focused effort on advancing projects towards execution.
Most notably, clean hydrogen projects reaching FID have seen a seven-fold increase in committed investment, climbing from approximately USD 10 billion across 102 projects in 2020 to around USD 75 billion across 434 projects in 2024.
Data from October 2023 to May 2024 further emphasizes this shift from planning to implementation. Total announced investments through 2030 have increased by approximately 20% – from USD 570 billion to USD 680 billion. The most significant growth has occurred in the more advanced stages of project development, with investments beyond FID increasing by a remarkable 90%, followed by a 30% increase in projects at the front-end engineering design (FEED) stage.
This transition across the global project pipeline from announcements to implementation is coupled with a natural attrition process that promotes industry maturation. This process eliminates less viable projects and prioritizes those with the highest potential, a pattern observed in the early stages of other clean energy industries, such as wind and solar.
Jaehoon Chang, President and CEO of Hyundai Motor Company and Co-Chair of the Hydrogen Council, stated: “The seven-fold increase in committed capital for hydrogen projects reaching FID over the past four years demonstrates the industry’s progress. We are pleased to see the industry walking the talk at this critical transitional moment, as evidenced in the latest Insights report. Moreover, further action is needed to ensure an accessible and affordable hydrogen supply, enabling the widespread adoption of hydrogen.”
Despite the progress, the hydrogen sector, like other clean energy industries currently, faces macroeconomic headwinds. These include rising inflation and interest rates, along with geopolitical tensions impacting energy markets. Sector-specific issues such as regulatory uncertainty and increasing costs for renewable power and electrolysers have led to project delays, particularly for renewable hydrogen projects.
Ivana Jemelkova, CEO of the Hydrogen Council, stated: “This report sends a clear message: hydrogen is happening. Now that hydrogen is a reality in the energy transition, it’s time to drive significantly more investment by 2030 to meet our mid-century targets. Equipped with concrete lessons learned from the past four years, we must urgently address challenges in key markets and create a more favorable environment for project execution.”
Sanjiv Lamba, CEO of Linde and Co-Chair of the Hydrogen Council, emphasized the need for a united effort: “Realizing hydrogen’s full climate and socio-economic potential requires a united effort from governments and industry. With a supportive regulatory framework and targeted incentives, investors will have the certainty they need to move projects to FID – ultimately contributing to achieving global climate targets.”
About Hydrogen Insights
Hydrogen Insights is a regularly published perspective on the hydrogen industry’s evolution by the Hydrogen Council. It provides a summary of the current state of the global hydrogen sector and actual hydrogen deployment. Authored by the Hydrogen Council in collaboration with McKinsey & Company, the report draws on a combination of public information and proprietary data from Hydrogen Council members. It represents a collaborative effort to share an objective, holistic, and quantitative perspective on the status of the global hydrogen ecosystem.
About The Hydrogen Council
The Hydrogen Council is a global CEO-led initiative committed to accelerating the clean energy transition through the use of hydrogen. It brings together a diverse group of 140 companies from 20 countries across the Americas, Europe, Africa, the Middle East and Asia Pacific. Spanning the entire value chain, and including large multinationals, innovative start-ups as well as investors, the Council’s membership represents some $9 trillion in market capitalization, 6.8 million in FTEs and some $6.4 trillion in revenues.
The Council is dedicated to unlocking the sustainability potential of clean hydrogen. Its mission includes fostering business and technological innovation as drivers for sustainable growth, creating quality jobs, and delivering social value.
Through its global reach, the Council promotes collaboration between industry, governments, investors, and civil society. It provides insights on and pathways for accelerating the deployment of hydrogen ecosystems around the world. Additionally, the Council supports the development of international safety and sustainability standards, paving the way for the deployment of reliable hydrogen solutions at scale.
To learn more, visit www.hydrogencouncil.com and follow us on X @HydrogenCouncil and LinkedIn.
