It remains a challenging time for hydrogen with costs remaining stubbornly high, impacting demand and market development. In the latest BloombergNEF (BNEF) data, hydrogen investment has halved to $24bn in 2024, compared with $47bn in 2023.
A recent Clifford Chance report echoes the challenges. It found the average levelised cost of hydrogen (LCOH) production in Europe for clean hydrogen stands at $5-8/kg, compared with $1-3/kg of grey hydrogen.
LCOH is a key metric, assessing the overall cost of producing hydrogen over its entire lifecycle. Understanding the drivers behind LCOH – and how to reduce them – is now critical for developers and policymakers alike.
Production costs for grey hydrogen and grey ammonia rose throughout 2024 and are expected to increase this year.
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