Green hydrogen is still making gains
Projects and firms win investments despite technical, economic, and political challenges
Green hydrogen, which is made by splitting water with renewable energy, sometimes seems like a long-shot solution to climate change. But despite political and economic headwinds, the low-carbon chemical feedstock and fuel is making some gains—especially in Europe—in the form of subsidies, investments, and deployed projects.
The nascent industry has struggled in recent months as the Donald J. Trump administration targeted US government–backed projects for cancellation and major companies such as Air Products and Chemicals, Shell, and BP backed away from corporate strategies emphasizing decarbonization.
Support from climate change advocates is also weakening. Some critics say green hydrogen is diverting scarce funding away from more-effective methods of combatting climate change.
Nonetheless, in mid-April, French prime minister François Bayrou signed a $169 million grant supporting the construction of a water electrolysis plant in Normandy’s Le Havre port area that will produce 34 metric tons (t) per day of hydrogen when it starts up in 2029. The company receiving the funding is Lhyfe, which builds onshore and offshore green hydrogen plants. Under the agreement, the French firm will receive $20 million by June and the rest over the next 4 years as reimbursements.
The fertilizer maker Yara International runs facilities nearby that it plans to decarbonize with low-carbon hydrogen, and Lhyfe says the two firms are in advanced talks. Kris Danaradjou, an executive with the Haropa Port system, in Le Havre, says Yara is one of multiple chemical makers and other potential customers along the Seine River between Le Havre and Paris looking to low-carbon hydrogen to meet their climate goals.
Elsewhere in Europe, the renewable hydrogen producer Hy2gen recently raised $53 million in a funding round led by the hydrogen infrastructure investment fund Hy24 and the engineering firm Technip Energies. Hy2gen operates a plant in Germany that makes 2.5 t per day of green hydrogen for transportation uses. The company is developing projects in Canada and Norway that will use green hydrogen to produce ammonia and a plant in France that will make sustainable aviation fuel.
Hy2gen CEO Cyril Dufau-Sansot says in a press release that the firm has proved itself by operating a small-scale facility in Werlte, Germany. “Now we can confidently complete the planning and certification stages for our industrial-scale production plants and head toward the construction phase,” he says.
In Austria, the petrochemical firm OMV has started up a 10MW green hydrogen plant near Vienna with a capacity of about 4 t per day. The company says it is using the hydrogen to upgrade waste food oils into sustainable aviation fuel and renewable diesel, for a net reduction of 15,000 t of carbon dioxide per year. OMC says the $28 million project is part of its ongoing transition into a sustainable chemicals, fuels, and energy company.
Even Air Products isn’t completely abandoning green hydrogen. In a May 1 investor call, CEO Eduardo Menezes said the firm would complete its 10-metric-ton-per-day green hydrogen plant in Arizona and honor clean hydrogen supply deals it has already signed in Europe. But the firm is canceling a 35 metric-ton-per-day plant in New York and holding off on further low-carbon hydrogen investments in Europe.
Green hydrogen investment doesn’t mean the companies involved have solved the fundamental flaws of low-carbon hydrogen as a climate solution, according to Joe Romm, a climate researcher at the University of Pennsylvania. On Earth Day this year, Romm published a book titled The Hype About Hydrogen.
Romm argues that the projects moving forward in Europe shouldn’t count as green hydrogen because they rely on renewable energy credits instead of newly built renewable energy sources matched to hydrogen production by the hour. As a result, they’ll often be powered by whatever is on the grid at the time and will have a significant net CO2 footprint.
And the cost of making green hydrogen has not come down as fast as industry boosters projected. “The price of electrolyzers was supposed to come down every year, like the cost curve of solar has,” Romm says. “But it turns out that the cost of electrolyzers rose 50% between 2021 and 2024. The hydrogen is not so green, and it's more expensive than people thought.”
Even if those problems were solved, Romm says, heat pumps, batteries, and other forms of electrification are far more ready to cut greenhouse gas emissions. “If people want to do R&D, go for it. But let's use 99% of the renewables we're building for directly replacing fossil fuels,” he says.
Green hydrogen is still making gains
Green hydrogen is still making gains
Green hydrogen, which is made by splitting water with renewable energy, sometimes seems like a long-shot solution to climate change. But despite political and economic headwinds, the low-carbon chemical feedstock and fuel is making some gains—especially
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