After the time of ambitions, that of disappointments. Despite big promises to decarbonize the industrial and heavy mobility sectors, the emerging low-carbon hydrogen sector – from renewable electricity (wind and solar) or nuclear – is stalling. The list of projects continues to grow. But implementation is far from keeping pace, judging by the low deployment of electrolyzers. “Whether politicians or businesses, a number of people have oversold hydrogen, saying it would save the world”, recognizes Philippe Boucly, president of the France Hydrogène professional network. On the business side, “this trend can, for example, be observed in the event of fundraising or an IPO”.
Only 12 gigawatts (GW) of electrolysis power globally are under construction or have already made a final investment decision, according to a study by the International Energy Agency (IEA) , at the beginning of the year. Very far from the 360 GW of electrolyzers announced globally for 2030, knowing that a capacity of barely more than 1 GW is already in service, mainly in China. “The main reason is the slowness in bringing planned projects to final investment decisions, due to a lack of buyers and the impact of rising prices on production costs”summarizes the AIE.
“The fundamentals of hydrogen have not changedmaintains Pierre-Etienne Franc, general manager of Hy24, investment fund manager. Except that, lately, things have gone wrong. Different factors have complicated the conditions for its growth: inflation, rising interest rates, geopolitical risks, regulatory negotiations…
“The sector faces reality”
The French Engie reflects the mood of the moment well. In February, the number one gas player in the country announced that it would postpone its objective, set for 2021, by five years. It is now targeting 4 GW of hydrogen “green”, from renewable energies, for 2035, and no longer for 2030. “The challenge is to scale up all the technologies that now exist. This is what will really bring down production costs”considers Erwin Penfornis, vice president of the global branch “hydrogen energy” from Air Liquide.
This other leading player intends to commission, by 2026, one of the largest electrolyzers in the world, near Le Havre. “Normand’Hy”, that’s its name, would have a power of around 200 megawatts, or 0.2 GW. The project is estimated at 400 million euros, almost half of which is in the form of public aid. To date, the share of electrolyzers already operational in France is still tiny. At the end of 2023, it was around 0.03 GW, despite a government target (since 2020) of 6.5 GW for 2030.
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