PARIS, Sept 22, 2023 (BSS/AFP) - By the end of 2023, China will control half
the world's installed capacity of electrolysers for producing low-carbon
hydrogen amid a slowdown in new projects due to inflation, according to an
International Energy Agency report released Friday.

"After a slow start, China has taken the lead on electrolyser deployment,"
the IEA report on hydrogen said.

China's installed electrolyser capacity has jumped significantly in recent
years, and is expected to reach 1.2 gigawatts -- 50 percent of the global
capacity -- after having accounted for just 10 percent of the global capacity
in 2020.

Electrolysers are devices used for the industrial separation of hydrogen and
oxygen within water molecules, using electricity obtained through renewable
energy sources such as solar, wind or nuclear.

With the green energy transition underway, electrolysers are becoming
essential to replace traditional methods of producing industrial hydrogen.

These have relied on polluting methane gas in a process linked to the
petrochemical industry which is inexpensive but results in greenhouse gas
emissions.

The production of low-carbon hydrogen could reach 38 million tonnes by 2030
as long as all projects that have been announced are implemented, the IEA
said.

But the IEA is concerned about rising equipment costs due to inflation which
are "putting projects at risk and reducing the impact of government support
for deployment".

"Several projects have revised their initial cost estimates upwards by up to
50 percent," it said.
 
The agency is also concerned about the slow replacement of traditionally
produced grey hydrogen for green hydrogen worldwide.

Low emission hydrogen accounted for less than one percent of the world's
demand in 2022, the agency said, meaning hydrogen use accounted for 900
million tonnes of equivalent carbon dioxide emissions.

"Low-emission hydrogen use is still far from what is needed to meet climate
goals," the report said, while calling for greater international cooperation
to avoid market fragmentation.