Scaling up the production and distribution of green hydrogen is widely seen as the biggest driver of cost reduction. But high renewable electricity prices are the single biggest factor in the cost of producing green hydrogen.
A report by Capgemini, Fit for Net-Zero, says the cost of green hydrogen today is around €6/kg, which means it’s not yet cost competitive with fossil alternatives. $1.5-2/kg is seen as the optimum price of green hydrogen in the future, but in order to produce low cost, price competitive green hydrogen within the next five to 10 years, regions with strong winds and solar radiation, large mineral resources, water and shorelines towards all continents, space and flexibility are needed. Several large regions in Africa offer this combination, and the African Hydrogen Partnership (AHP) was started in 2019 to lay the foundation for establishing hydrogen economies and societies in the region. After a successful first conference in February 2020, the AHP was incorporated as a non-profit association in November 2020.
The only continent-wide African umbrella association dedicated solely to the development of green hydrogen, green hydrogen-based chemicals, fuel cell technology and related business opportunities in Africa, the AHP wants to transform Africa from a vast continent in need of products, infrastructure, energy and mobility, to a region at the forefront of clean technologies with a thriving hydrogen value chain.
Fit for Net-Zero says the cost of hydrogen could drop to €1.5/kg by 2030 in Southern Europe and North Africa, with a giga-scale approach to hydrogen electrolyser plants, powered by electricity provided by large solar plants, associated with wind, and transported to Northern Europe through shipping and grids.
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