A Hydrogen Council report published today (May 11) found that the number of hydrogen projects reaching final investment decision (FID) had grown by 30% between May 2022 and January 2023.

The Hydrogen Insight 2023 report by the Hydrogen Council and McKinsey & Company highlighted growth across the global project funnel, estimating that total investments had increased by 35% from May last year (2022) to this January (2023).

Despite just 9% of total investments having reached final investment decision (FID), that saw a 30% increase over the same period.

Tracking 1,040 project globally, representing $230bn in direct investment between now and 2030, up from $240bn, the report notes that around half the projects are focused on large-scale industrial applications, with 20% focusing on mobility.

North America is leading with committed investments of $10bn, while Europe follows with $7bn and China with $5bn, with growth in China reaching over 200%.

Having taken a deep dive into North America, the report found that there has been a 55% increase in announced investments since September 2022, with the Council noting that the Inflation Reduction Act’s (IRA) production tax credit of up to $3/kg could potentially accelerate clean hydrogen in the US.

Bernd Heid, Senior Partner at McKinsey, said, “North America has been a real engine of growth: it now accounts for 30% of committed funding and 70% of committed clean hydrogen production.”

However, the report warns that strong headwinds such as strained supply chains, labour shortages, energy performance contracting (EPC) capacity, increasing inflation and interest rates, and permitting delays could slow deployment.

According to the report, more than 1,000 refuelling stations are now in operation globally, with total announced electrolyser capacity standing at 230GW in 2030.

The Hydrogen Council warned that despite progress, committed projects lag behind targets, noting that by 2030, a more than twentyfold increase would be required to track toward Net Zero objectives.

“Resources and equipment needs remain critical to ensure deployment of clean hydrogen supply projects, prevent infrastructure bottlenecks, and enable hydrogen-ready end-user plants,” the Council said.

“Taking action at scale required is a learning journey for governments, industry and the public,” said Yoshinori Kanehana, Chairman of Kawasaki Heavy Industries and Co-Chair of the Hydrogen Council. “Maintaining strong communication and relationships will help up to achieve our goals for the energy transition, together.

Tom Linebarger, Executive Chairman and Chairman of the Board of Cummins and Co-Chair of the Hydrogen Council, added, “It’s great to see ongoing momentum with hydrogen projects around the world. As we continue our quest to fight climate change, our focus needs to be on accelerating the action we take now.”