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#GetTheFutureYouWant

A PATH TO A GREENER FUTURE

INTRODUCTION

The energy transition and the global imperative towards

sustainability have driven organizations to explore new

energy models and solutions. Low-carbon hydrogen

is gaining recognition as one of the possible routes to

accelerating decarbonization of high-emission sectors

such as industry and heavy mobility. Many countries

including US, China, Japan as well as many European

Union countries amongst others have announced major

investments to accelerate its development.

However, today prominent production pathways for

hydrogen continue to rely on the use of fossil fuels. The

move to “low-carbon hydrogen” could avoid the annual

emission of 830 million tons of CO2 currently emitted by

conventionally produced hydrogen,1 a vital contribution

to securing a clean-energy future. Francesco La Camera,

Director-General of the International Renewable Energy

Agency (IRENA), comments: “Cost-competitive low-carbon

hydrogen can help us build a resilient energy system that

thrives on modern technologies and embraces innovative

solutions t for the 21st century.”2 This fuel source is

creating new commercial opportunities throughout the

value chain – including alternative revenue streams, as

well as new business models – but it must present an

economically competitive alternative to carbon-based

hydrogen if businesses are to consider it as viable in the

long term.

To understand how organizations could capitalize on

low-carbon hydrogen's potential, we conducted a global

survey across 13 countries, with responses from 500

executives from energy and utilities (E&U) rms and

360 executives from end-user sectors, including heavy

transportation, aviation, maritime transport, steel,

chemicals, and rening3. To complement the quantitative

insights, we also conducted more than 20 in-depth

interviews with supply- and demand-side organizations,

startups, venture capital (VC) organizations, academics,

researchers, and regulators.

Capgemini Research Institute 2023

Low-Carbon Hydrogen: A Path To A Greener Future

In this report, we will be exploring ve major themes

The decarbonization

potential of low-

carbon hydrogen

Evolving business

models, as well

as existing and

emerging use cases

Investments

in low-carbon

hydrogen, from

regulatory/policy

and organizational

perspectives

Key challenges and

major roadblocks

across the value

chain

Key business,

organizational,

and technological

factors in

accelerating low-

carbon hydrogen

projects

INTRODUCTION

1 2 345

Capgemini Research Institute 2023

Low-Carbon Hydrogen: A Path To A Greener Future

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APATHTOAGREENERFUTURE#GetTheFutureYouWant2Low-CarbonHydrogen:APathToAGreenerFutureINTRODUCTIONTheenergytransitionandtheglobalimperativetowardseconomicallycompetitivealternativetocarbon-basedsustainabilityhavedrivenorganizationstoexplorenewhydrogenifbusinessesaretoconsideritasviableintheenergymodelsandsolutions.Low-carbonhydrogenlongterm.isgainingrecognitionasoneofthepossibleroutestoacceleratingdecarbonizationofhigh-emissionsectorsTounderstandhoworganizationscouldcapitalizeonsuchasindustryandheavymobility.Manycountrieslow-carbonhydrogen'spotential,weconductedaglobalincludingUS,China,JapanaswellasmanyEuropeansurveyacross13countries,withresponsesfrom500Unioncountriesamongstothershaveannouncedmajorexecutivesfromenergyandutilities(E&U)firmsandinvestmentstoaccelerateitsdevelopment.360executivesfromend-usersectors,includingheavytransportation,aviation,maritimetransport,steel,However,todayprominentproductionpathwaysforchemicals,andrefining3.Tocomplementthequantitativehydrogencontinuetorelyontheuseoffossilfuels.Theinsights,wealsoconductedmorethan20in-depthmoveto“low-carbonhydrogen”couldavoidtheannualinterviewswithsupply-anddemand-sideorganizations,emissionof830milliontonsofCO2currentlyemittedbystartups,venturecapital(VC)organizations,academics,conventionallyproducedhydrogen,1avitalcontributionresearchers,andregulators.tosecuringaclean-energyfuture.FrancescoLaCamera,Director-GeneraloftheInternationalRenewableEnergyAgency(IRENA),comments:“Cost-competitivelow-carbonhydrogencanhelpusbuildaresilientenergysystemthatthrivesonmoderntechnologiesandembracesinnovativesolutionsfitforthe21stcentury.”2Thisfuelsourceiscreatingnewcommercialopportunitiesthroughoutthevaluechain–includingalternativerevenuestreams,aswellasnewbusinessmodels–butitmustpresentanCapgeminiResearchInstitute20233Low-CarbonHydrogen:APathToAGreenerFutureINTRODUCTIONInthisreport,wewillbeexploringfivemajorthemes1Thedecarbonization2Evolvingbusiness3Investments4Keychallengesand5Keybusiness,potentialoflow-models,aswellinlow-carbonmajorroadblocksorganizational,carbonhydrogenasexistingandhydrogen,fromacrossthevalueandtechnologicalemergingusecasesregulatory/policychainfactorsinandorganizationalacceleratinglow-perspectivescarbonhydrogenprojectsCapgeminiResearchInstitute20234Low-CarbonHydrogen:APathToAGreenerFutureEXECUTIVEUnderpinnedbyaglobalshifttowardsdecarbonization,Withgovernmentsupport,decliningrenewable-energySUMMARYhydrogenisgainingsignificanceasanenergyvector,costs,rapidtechnologicaladvances,andagrowingfocusespeciallyforhigh-emissionsectorsthatdonotuseondecarbonizationandsustainableenergysolutions,electricitydirectly.Mostorganizationsinourresearchthedemandforlow-carbonhydrogenisexpectedtobelievethatlow-carbonhydrogenwillbealong-termincreasemultifold.Sectorswithtraditionalhydrogencontributortoachievingemissionsandsustainabilityapplications,particularlyinpetroleumrefining,chemicalsgoals:andfertilizers,andsteel,havehighpotentialforadoptionoflow-carbonhydrogen.Demandforhydrogenin•63percentofenergyandutilities(E&U)organizationsnewapplicationssuchaslong-rangegroundmobilityseeitisasakeytooltodecarbonizeeconomies(forheavy-dutytrucks,coaches),long-haulaviationspecificallysustainableaviationfuel(SAF),ormaritimeis•62percentofend-userorganizationsarelookingtoexpectedtopickup.introducelow-carbonhydrogentocarbon-intensivepartsoftheirbusinessOurresearchsuggeststhatamajority(64percent)ofE&Uorganizationsareplanningtoinvestinlow-carbon•E&Uorganizationsexpectlow-carbonhydrogentohydrogeninitiativesby2030;and9in10plantodomeetupto18percentofenergydemandby2050soby2050.Onaverage,0.4percentoftotalannualCapgeminiResearchInstitute20235Low-CarbonHydrogen:APathToAGreenerFutureEXECUTIVErevenueisearmarkedforlow-carbonhydrogenbyE&Uincreasethetotalcostofoperations(TCO).Finally,SUMMARYorganizations.Investmentsareflowinginacrossthetechnology,engineering,infrastructural,andskill-relatedhydrogenvaluechain–especiallyintodevelopmentchallengesarealsoimpedimentstomorerapidhydrogenofcost-effectiveproductiontechnology(52%ofadoption.organizationsinvesting),electrolyzersand,fuelcells(45%),andhydrogeninfrastructure(53%)tohelpcreateWhiletheemergingmarketforlow-carbonhydrogenalternativerevenuestreamsandaidindecarbonizationisbothhighlycomplexandfragmented,itholdsrealefforts.Fromtheregulatoryside,80+countriesacrossdecarbonizationpotential.Toseizethisopportunity,theworldsupportclean-hydrogenproduction,eithermitigatecosts,andscaleatpace,organizationswillneedthroughhydrogenpoliciesorroadmaps,orbyprovidingtoaddressthreeaspects:supportforlow-carbonhydrogenprojectsandR&Dviasubsidiesoremission-tradingschemes,orbylevyingtaxes•Strategic:Toscaleuphydrogenproduction,oncarbon-intensivehydrogen.investmentsmustbesharedbetweenpublicandprivateplayersandcustomerdemandmustbestrong.However,substantialchallengesremain.Today,low-Organizationsshouldevaluatenewbusinessmodelscarbonhydrogenis2–3timesmorecostlytoproducefromsustainabilityaswellastotalcostofownershipthancarbon-basedhydrogen.Moreover,storage,perspectives.Toenablethesemodels,definingatransportationandenergylossesacrossthevaluechaingovernancestructurededicatedtolow-carbon-hydrogenproductionalongwithafocusoneducationCapgeminiResearchInstitute20236Low-CarbonHydrogen:APathToAGreenerFutureEXECUTIVEandupskillingprogramsisrequired.lifecycleandacrossecosystems.SUMMARY•Technological:Organizationsmustharnessthe•Ecosystem:Finally,toemergeasapreferredpartnerpotentialoftechnologyanddigitalengineeringtoforend-userorganizations,andtobringlow-carbonmitigatechallengesrelatedtoasset-levelmeasurementhydrogenasaviablealternative,organizationsofcarbonintensity,cost-optimization,efficiency,shouldbuildpartnershipswithelectrolyzerproviders,safety,performance,profitability,andreal-timerenewable-energyproducers,storageproviders,anddecision-making.Technologiessuchasdigitaltwins,supply-chainentitiestofacilitateproductionatscale.artificialintelligence(AI),analytics,andblockchaincanhelpaddresstheseimplementationchallengesbymodellingvariousscenariostomaximizeROIandallowingdata-drivendecision-makingthroughouttheCapgeminiResearchInstitute2023"Whileit'sstillintheearlystages,I7believethathydrogenhasthepotentialLow-CarbonHydrogen:APathToAGreenerFuturetobeoneofthemostmaturerenewabletechnologies,capableofacceleratingourAnnRosenbergtransitiontowardssustainableenergy."Co-FounderofSDGAmbitionatUnitedNationsGlobalCompactCapgeminiResearchInstitute20238Low-CarbonHydrogen:APathToAGreenerFutureWHATISWhatislow-carbonreformingofnaturalgas,emittinghighlevelsofCO2LOW-CARBONHYDROGEN?hydrogen?duringproduction.Figure1highlightsthevarioushydrogenproductionmethodsandtheirassociatedHydrogenisthesimplest,lightest,andmostabundantcarbonintensity.Whilethecolorsofhydrogenareaelementintheuniverse.Ittypicallydoesnotexistfreelyinhelpfulwaytocategorizetheproductionpathways,whatnaturebutratherisproducedfromsourcessuchasfossilismoreimportantistheresultingcarbonintensity,whichfuels,renewables,andnuclear,usingarangeofextractioncanvarysignificantlyevenwithinagivencolor.andproductiontechniques.Hydrogen’svaluableattributes–suchashighenergycontentperunitmassLow-carbonhydrogen(threetimesmorethangasoline)4lackofCOemissionsatForhydrogenproductiontobeconsideredlow-carbon,it2mustcomeundertheEU’sproposedemissionsthresholdpointofuse;andpotentialasastoragemediumforelectricity–makeitanattractiveenergyvectorandfuel.of3.38kgCO-equivalentperkgofhydrogen5,whichisMoreover,itsabilitytobestoredandtransportedin2variousforms(gaseous,liquid,orevenconvertedtoothermolecules)makesitapowerfulenablerfor70%lowerthanthatofthepredefinedfossilfueldecarbonization–bothinrelationtoenergysystemsandend-useapplications.comparator,includingtransportandothernon-However,notallhydrogeniscreatedequal.Mostproductionemissions.6IntheUS,thecorrespondinghydrogeniscurrentlyproducedviasteammethanecarbonintensityvaluetoqualifyforhydrogenproductiontaxcreditsundertheIRAis4.0kgCOe/kgH.7Although22low-carbonhydrogencanincludebiomasspyrolysisaswell,inthisresearch,ourmainfocusincludesrenewableornuclear-energy-poweredelectrolysis-producedhydrogenemittingnoormarginalcarbon.CapgeminiResearchInstitute20239Low-CarbonHydrogen:APathToAGreenerFutureFig.1DifferentpathwaysofhydrogenproductionvaryincarbonintensityWHATISPrimarysourceCoalNaturalgasBiomassRenewablesNuclearLOW-CARBONHYDROGEN?SteamSMRwithKeyproductionGasiﬁcationmethanecarboncapture,PyrolysisPyrolysisElectrolysisElectrolysistechnologiesreformingutilization,and(SMR)#storage(CCUS)#AmountofCO225kg11kg11–13kgofCO20.03–BiomasspyrolysisNoormarginalNoormarginalemittedperkgofisgenerated0.37kgwithstorageofCO2producedCO2producedsolidcarbonisaH2produced3–6kgisnegativeemissiontechnologyemittedLow-carbonhydrogen(<3.38kgofCO2emittedperkgofhydrogenlifecycle)Alsocalled...BrownGreyBlueTurquoiseSupergreenGreenPinkhydrogenhydrogenhydrogenhydrogenhydrogenhydrogenhydrogenNote:Thischartcoversthemainmethodsofhydrogenproductioncurrentlyinuse.Forfurtherdetailsofdifferenthydrogen-productiontechnologies,pleaserefertotheappendix.Thepyrolysisofbiomethane,biomass,waste,orwastewater,withsubsequentstorageofsolidcarbon,isanegative-emissiontechnology,sincetheCO2previouslyremovedfromtheatmosphereandneutralizedinthebiomethaneisnotreleasedduringthepyrolysisreactionoruseofthehydrogenproducedand,consequently,noclimate-damaginggreenhouse-gaseffectsareproduced.#CO2-eqemissionscouldbehigherthanindicatedabovewhenconsideringtheefficiencyoftheCCUSprocess,methaneleakageinthesystem,andthetimehorizonbetween20and100yearsfortheGlobalWarmingPotential(GWP).Source:CapgeminiResearchInstituteAnalysis;WorldEconomicForum;IEA;EnergyCities;Enel;InstitutPolytechniquedeParis;HydrogenEurope;Capgemini,“Thepathtolow-carbonhydrogen,”October2022.CapgeminiResearchInstitute202310Low-CarbonHydrogen:APathToAGreenerFuture01LOW-CARBONHYDROGENISAKEYTOOLFORDECARBONIZINGHIGH-EMISSIONSECTORSCapgeminiResearchInstitute202311Low-CarbonHydrogen:APathToAGreenerFutureOrganizationssee•Inourresearch,61percentofenergyandutilities(E&U)low-carbonhydrogenasanorganizationsbelievethatthecurrentcrisishasledimportantvectorfornationstoreconsidertheirenergymixesenergytransition•Almosttwo-thirds(62percent)ofE&UorganizationsTheglobalenergycrisisinitiatedbytheCOVID-19believethatlow-carbonhydrogencanhelpnationspandemicandexacerbatedbyongoinggeopoliticalreducedependenceonfossilfuelsandpromotetensionshasbolsteredthecaseforlow-carbonhydrogen.energyindependenceGovernmentsandorganizationsacrossregionsarelookingtoreducedependencyonfossilfuels,aswell62%asadvanceprogresstowardsdecarbonizationandenhancingenergysecurity:ofE&Uorganizationsbelievethatlow-carbonhydrogencanhelpnationsreducedependenceonfossilfuelsandpromoteenergyindependenceCapgeminiResearchInstitute202312Low-CarbonHydrogen:APathToAGreenerFutureFig.2Organizationsstronglybelieveinthepotentialoflow-carbonhydrogenfordecarbonization%OFORGANIZATIONSRANKING"TOREPLACECARBON-INTENSIVE%OFORGANIZATIONSAGREEINGWITHTHESTATEMENT:SECTIONSOFOURBUSINESSASPARTOFADECARBONIZATION"LOW-CARBONHYDROGENISONEOFTHEKEYLONG-TERMSOLUTIONSINITIATIVE"AMONGTHETOP3OBJECTIVESFOREXPLORINGLOW-CARBONHYDROGENFORDECARBONIZINGECONOMIES"Average62%Average63%Gasutilities75%Chemicalsandfertilizers72%WaterutilitiesElectricutilities67%Maritimetransport71%UtilitiesMulti-utilities61%EnergyReﬁning,marketing,and57%Steel64%distribution(includingretail)Alternativeenergy81%Heavytransport61%Energyservices72%Integratedoilandgas64%Aviation59%Oilandgasextraction57%55%Petroleumreﬁning43%Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations;N=447respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202313Low-CarbonHydrogen:APathToAGreenerFutureHydrogenusewouldmakeitpossibletodecarbonizeAsFigure2shows:around15percentoftheeconomythatisnotsuitableforthedirectuseofelectricity.Researchsuggests•62percentofend-userorganizationsarelookingatthat86millionmetrictons(MMt)ofCO2emissionslow-carbonhydrogentoreplacecarbon-intensivecouldbeavoidedannuallyintheEU,EuropeanFreesystemsTradeAssociation(EFTA),andUKbyusinglow-carbonhydrogeninindustriessuchassteel,chemicals,fertilizers,•almost3in4organizationsinchemicalsandfertilizersoilrefining,etc.8Mostorganizationsalsobelievethatandthemaritimetransportsectoraredoingthesamelow-carbonhydrogenwillbealong-termcontributortoachievingemissionsandsustainabilitygoals.Ann•63percentofE&Uorganizationsagreethatlow-carbonRosenberg,Co-FounderofSDGAmbitionatUnitedhydrogenisoneofthekeylong-termsolutionsforNationsGlobalCompact,says,“Thecurrentsituationhasdecarbonizingeconomiesheightenedtheurgencytodevelopnewenergytechnologies,andI'moptimisticaboutthegrowingfocusonhydrogenWulf-PeterSchmidt,DirectorSustainability,Advancedasapotentialsolution.Whileit'sstillintheearlystages,IRegulation&ProductConformityatFord,says,“Wearebelievethathydrogenhasthepotentialtobeoneofthemostconsideringtheuseoflow-carbonhydrogen(greenhydrogen)maturerenewabletechnologies,capableofacceleratingourinourlogisticsandsupplychain.Forexample,afundamentaltransitiontowardssustainableenergy”conditionfornear-zeroemissionsteelisgreenhydrogen.Butalsoingeneral,greenhydrogeniskeytoensurecarbonneutralityacrossindustriesgoingforwardandthat'swhereweareworkingtogetherwithdifferentpartnersandtheindustry.AndwecommittedourselvesbybeingpartoftheFirstMoverCoalition.”CapgeminiResearchInstitute202314Low-CarbonHydrogen:APathToAGreenerFutureFortheenergytransitiontosucceed,anotherpressingSouthernCaliforniaGasCompany(SoCalGas)ischallengeneedstobeovercome:theissuearoundcollaboratingwithvariouspartnerstocreateaninnovativetheintermittencyofrenewable-energysources.Ourgreen-hydrogenstoragefacilityforitsColoradocampus.surveyshowsthatnearlythree-quarters(71percent)TheelectrolyzeronsitewilluserenewablesourcesofE&Uorganizationsbelievethatlow-carbonandproducegreenhydrogentobestoredinfuelcellshydrogenisaviablemethodofenergystoragetoproducerenewableelectricityondemand.9Atthefromintermittentrenewablesources,actingasasametime,organizationsaretryingtofindsolutionstobatteryandmakingrenewableenergysuchassolarchallengesrelatedtothecostandefficiencyofpowertoandwindavailabletoevenmoreapplications.France-gastopower(P2G2P)technologies.basedHDFEnergy,ahydrogen-to-powercompany,isevaluatingnewmodelsinthisspace.MathieuGeze,71%DirectorAsia,says,“WithourRenewstable®powerplants,wecombinerenewableenergy,hydrogen,andofE&Uorganizationsbelievethatlow-carbonhydrogenbatteriestodeliversomethingnon-intermittenttotheisaviablemethodofenergystoragefromintermittentgrid.Thesepowerplantsarecomposedofanintermittentrenewablesourcesrenewablesourceandalong-termon-sitehydrogenenergystorage.Thebeautyofthoseprojectsisthatwedon’tsellhydrogeninthoseprojects.Wesellkilowatthours.Thehydrogenisjustusedtostoreelectricity.”CapgeminiResearchInstitute202315Low-CarbonHydrogen:APathToAGreenerFutureFig.3E&Uorganizationsexpectlow-carbonhydrogentomeetone-fifthofenergydemandby2050OrganizationsareoptimisticEXPECTEDSHAREOFLOW-CARBONHYDROGENINTHETOTALENERGYCONSUMPTIONOFYOURCOUNTRYBY2050andambitiousaboutlow-25%carbonhydrogen22%22%Globalhydrogenproductionstandsataround7521%21%21%milliontons(Mt)H2/yraspurehydrogenandan20%20%additional45MtH2/yraspartofamixofgases.Thisisequivalentto3percentofglobalfinalenergy18%demand.10Low-carbonhydrogen’sshareoftotalfinal17%energyconsumption(TFEC)waslessthan0.1percent16%in2020.TheInternationalRenewableEnergyAgency(IRENA)estimatessuggestthatitcouldcontribute14%14%upto12percentofTFECby2050.11WealsoaskedE&Uexecutivesinoursurveytoestimatelow-carbonGlobalNetherlandsIndiaAustraliaFranceItalyNordicsSpainJapanGermanyUKUSCanadahydrogen’sshareofTFECintheircountryby2050.AsFigure3showsbelow,organizationsareevenmorepositivethanthepublishedestimates.Onaverage,theyexpectlow-carbonhydrogentomeet18percentofTFECby2050.Theyconsiderdecliningcostsofelectrolyzersandrenewableenergy–especiallysolarandwindenergy–asakeyenablerofthisshift.Note:Thisrepresentssubjectiveorganizationalexpectationsoflow-carbonhydrogenandisnotbasedonpresentcapabilitiesandinvestmentlevels.Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=447respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202316Low-CarbonHydrogen:APathToAGreenerFutureFig.4E&Uorganizationsexpectlow-carbonhydrogen’sshareofthetotalhydrogenmixtoincreasesignificantlyby2050Hydrogenmixtoday71%1%23%Hydrogenmixexpectedin20505%-20ppOftotalhydrogencurrentlyproduced,76percent-49pp+16ppcomesfromnaturalgasand23percentfromcoal.The+54pp3%shareoflow-carbonhydrogenislessthan1percentof22%21%55%thetotalhydrogenmixtoday,12butthisisexpectedtoincreasewiththetailwindsofgovernmentsupportandloweringproductioncosts:E&Uorganizationsexpectittocontributeupto55percentofthetotalhydrogenmixby2050(seeFigure4).GreyBlueLow-carbonOthersNote:Thisrepresentsubjectiveorganizationalexpectationsforlow-carbonhydrogenandisnotbasedonpresentcapabilitiesandinvestmentlevels.Source:IEA,HydrogenTrackingReport,September2022;CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202317Low-CarbonHydrogen:APathToAGreenerFutureMathieuGeze“WithourRenewstable®powerplants,wecombinerenewableenergy,hydrogen,andDirectorAsia,batteriestodeliversomethingnon-intermittentHDFEnergytothegrid.Thesepowerplantsarecomposedofanintermittentrenewablesourceandalong-termon-sitehydrogenenergystorage.”CapgeminiResearchInstitute2023HydrogenwithCCUS:18Low-CarbonHydrogen:APathToAGreenerFutureHopeorjusthype?However,thereissomedebatearoundtheefficiencyofthetechnology:“Blue”hydrogenisoftenclassifiedas“clean”becauseitisproducedusingcarbon•Researchcurrentlysuggeststhat10–20percentofcarbongeneratedcapture,utilization,andstorage(CCUS)technology.Itcurrentlyhasacostadvantageoverhydrogenproducedwithelectrolysis($2.27/kgforhydrogenproducedwithduringtheproductionofhydrogencannotbecaptured;16however,SMRCCUSvs.$5.96/kgforhydrogenproducedwithrenewableelectrolysis),andalsothereareeffortsunderwaytodeveloptechnologiesthatwouldrequireslesscapitaloutlayasexistingnatural-gasinfrastructurecanbeused.Hydrogencapturemorethan95%ofcarbon.withCCUSisrapidlyprogressingincertaincountries,suchastheUS.AroundnineUS•Thereisalsoanadditionalriskofmethane(themostpotentstatesintheMidwest,Southwest,andGulfCoastarecompetingforfederalfundinggreenhousegasorGHG)leakageduringtheproductionofhydrogen;todeveloptheirCCUShydrogeneconomies.13Recently,US-basedoilandgascompanyinoursurvey,61percentofend-usersand51percentofE&UExxonMobilunveiledplansforitsnewhydrogenproductionplant,whichwilluseCCUSorganizationsbelievethatevenhydrogenproducedwithCCUSisnottechnologyatitsrefiningandpetrochemicalfacilityinBaytown,Texas.Theproposedenvironmentallysustainable.facilitywouldproduceupto1billioncubicfeetperday(cuft/day)ofhydrogen.The•Lastly,asthepriceofCCUS-producedhydrogenisstronglyinfluencedCCUSinfrastructurewouldhavethecapacitytotransportandstoreupto10millionbythepriceofnaturalgas–whichthecurrentgeopoliticalcrisishasmetrictons(MMt)ofCOperyear.14AnotherexampleincludesAirLiquide,Chevronpushedup–itscost-competitivenessmaydrasticallydiminishinthenearfuture,especiallyinEurope;overhalfofend-userorganizations2(53percent)and44percentofE&Uorganizationsbelievethistobethecase.Corporation,LyondellBasellandUniperSEformingaconsortiumtoproducehydrogenusingnaturalgaswithCCSandrenewablehydrogenviaelectrolysisintheUSGulfCoasttosupplyend-usemarkets.15CapgeminiResearchInstitute202319Low-CarbonHydrogen:APathToAGreenerFutureFig.5OrganizationsarequestioningthedecarbonizationpotentialofhydrogenproducedwithCCUS%OFRESPONDENTSAGREEINGWITHTHEFOLLOWINGSTATEMENTS:"HYDROGENPRODUCEDWITHCCUS..."Figure5showsthatamajorityoforganizations(62percentof…isjustastageintheshifttolow-carbonhydrogen62%end-userorganizationsand59percentofE&Uorganizations)59%believethathydrogenproducedwithCCUStechnologyisonly…isnotenvironmentallysustainable,evenastageinthelong-termshifttolow-carbonhydrogen.Lesswithcarboncapture61%thanone-third(28percentofE&Uand30percentofend-user)51%organizationsbelievethatCCUStechnologyisheretostay.…willbeuncompetitiveintheneartermasaresultofrisinggasprices53%44%…technologyisheretostay30%Enduserorganizations28%E&UOrganizationsSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202320Low-CarbonHydrogen:APathToAGreenerFuture02DEMANDFORLOW-CARBONHYDROGENISGROWINGACROSSKEYSECTORSCapgeminiResearchInstitute202321Low-CarbonHydrogen:APathToAGreenerFutureMorethan80%Thereisstrongemergingpotentialforlow-carbonofrespondentsfromtherefiningandhydrogenfertilizersandchemicalindustriesbelievethatlow-carbonhydrogenwillhaveahighimpactGlobalhydrogendemandwasmorethan94Mtin2021,ontheirindustryby2030.a5-percentincreaseover2020.17Oursurveyhighlightsthatoveralldemandforhydrogenacrossindustriesandgeographieshasincreasedbymorethan10percentinthepastthreeyears,withastrongdemandemerginginthechemicalsandpetroleumrefiningsectors.Asperoursurveydata,demandforhydrogenfrommorethanhalfoforganizationshasgrownbymorethan10percentinFrance,India,theUK,Japan,theUS,Germany,andSweden.CapgeminiResearchInstitute202322Low-CarbonHydrogen:APathToAGreenerFutureFig.6Industriessuchasrefining,fertilizers,andchemicalswillwidelyharnesslow-carbonhydrogen%OFRESPONDENTSWHOSEEHIGHPOTENTIALFORLOW-CARBONHYDROGENINTHEIRRESPECTIVEINDUSTRIES100%99%96%94%83%56%Althoughthedemandforlow-carbonhydrogenis74%81%85%expectedtoincreaseacrosssectors,thestrongest43%41%30%demandiscomingfromsectorswheretheopportunityforelectrificationisminimalandusecasescouldberealizedintheshortterm,givenlocalizedvolumes.Demandandpotentialoflow-carbonhydrogenremainshighfortraditionalhydrogenapplications,particularlyPetroleumreﬁningFertilizersSteelMaritimetransportAviationHeavytransportandchemicalsHighpotentialby2030Highpotentialby2050Note:Respondentsfromeachsectoransweredaboutpotentialfortheirownindustryonly.Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizationsCapgeminiResearchInstitute202323Low-CarbonHydrogen:APathToAGreenerFutureinpetroleumrefining,chemicals,fertilizers,etc.Demandforhydrogeninnewapplications,suchasinheavy-dutytransportation,aviation,andmaritime,isexpectedtopickupslowlyincomparisonwithotherindustrialsectors(seeFigure6).Oursurveyrevealsthatmorethan80percentofrespondentsfromtherefining,andfertilizersandchemicalindustriesbelievethatlow-carbonhydrogenwillhaveahighimpactontheirindustryby2030.CapgeminiResearchInstitute202324Low-CarbonHydrogen:APathToAGreenerFutureAvarietyoflow-carbonhydrogenusecasesareemergingacrossvariousindustriesApartfromthetraditionalhydrogen-usersectors,sectorswithlimitedopportunitiestoelectrify,suchasheavy-dutytransportation,aviationormaritime,etc.,arealsoexploringlow-carbonhydrogenusecases,mainlytoachievetheirsustainabilitytargetsandcutemissions.Organizationsexpectdifferentapplicationstomatureatdifferentratesandcostreductionandinnovativebusinessmodelswillberequiredtoscaleup.An,ExecutiveVice-PresidentatIndia-basedsteelcompany,says:“Thebiggestuseoflow-carbonhydrogeninthesteelindustrywillbemakinghydrogen-basedDRI[directreducediron]plants,followedbyuseinblastfurnaces.”Figure7highlightsrisingusecasesoflow-carbonhydrogen.Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202325Low-CarbonHydrogen:APathToAGreenerFutureFig.7Newlycommercializedapplicationsofhydrogenareopeningupopportunitiesintransportationandotherenergy-relatedsectors18,19,20,21,22,23,24,25,26IndustryLow-carbonhydrogenusecasesLow-carbonhydrogenuseLow-carbonhydrogenuseIndustryexamplesPetroleumexisting/emergingintheshorttermcasesemergingby2025casesemergingby2030(reﬁning)•ExxonMobilisoperatinganadvancedhydrocrackerunit•Createpetroleumproducts,includinggasolineand•Cleanfeedstockforoilreﬁning•HydrogenburnersinRotterdam,NetherlandstocreateproductssuchasChemical&diesel(hydrocracking)(hydrotreating)•Hydrogenplasma-smeltingreductionEHCGroupIIbasestocksandultra-lowsulfurdiesel18fertilizer•Desulfurization•YaraCleanAmmonia,aglobalunitofYaraInternational,Steeliscurrentlyexploringthepossibilityofproducinggreen•Ammoniaforindustrialuse(refrigerator,puriﬁcator&•Industrialheat(usedinindustrialburnersammoniaasfertilizerusinggreenhydrogen19chemicalstabilizer)•ArcelorMittalhassuccessfullytestedtheabilityto•Ammoniaforhouseholduse(ammoniumhydroxideforandboilerstoprovidelow-carbonheat)partiallyreplacenaturalgas(6.8%)withgreenhydrogenintheproductionofDRIatitssteelplantincleaningproducts)Contrecoeur,Quebec20•Ammoniaasfertilizer•DAFTrucksisworkingondevelopinganinternalcombustionenginerunningonhydrogen21•Methanol(fuels&additives,andasachemicalprecursor)•VolvoisdevelopingFCEVtruckspoweredbyhydrogen22•ReducingagentinH2-DRI(directreducediron)•Hydrogeninjection•EngineersattheUniversityofNewSouthWalesareHeavy-duty•Combinationofelectricbatteriesandhydrogen•e-fuels(carriersofhydrogeninliquidform•Hydrogen-blendedcompressednaturalgasworkingondevelopingnewhydrogen-dieselhybridtransportfuel-cellelectricvehicles(HFCEVs)-eMethanol,ammonia,ethanol,biofuels,(H-CNG)clean-fuelcoaches/trucksenginesforheavyvehiclessuchasminingtrucks,etc.23(includingbusesbiogas,synthetice-fuels)forbuses/trucks/trucks,etc.)•Poweringhydrogenrefuelingstations•MANEnergySolutionshaslauncheda20%•Hydrogeninternalcombustionengineshydrogen-ﬁred,stationaryengineforthemarinesectorMaritime•HFCEVs-trucks/coachesetc.•Hybridsolutions–hydrogenfuelcellsandin2021andiscurrentlyworkingondevelopinga100%traditionalpropulsionforlargevesselshydrogencombustionenginesforlaunchby203024•Synthetice-fuelsderivedfromhydrogen,suchasammonia•Hydrogencombustionengines•Airbusisdevelopingaliquid-hydrogen-poweredfuelcell•Electriﬁcationofportterminalsandengineandplanstotestitonthelargestcommercial•Hydrogenfuelcellsforlargevesselsairplanesby2026,tobefullyoperationalby203525•Hydrogenfuelcellsforportvehiclesandbattery-operatedequipment•Rolls-RoyceandEasyJethavesuccessfullyconvertedaequipment•Synthetice-fuelsregularairplaneenginetorunonliquidhydrogenfuel,•Liquidhydrogencombustionenginesinitiallyforshort-haulﬂightsandthetrialwillthen•Liquid-hydrogenfuelcells•Gaseoushydrogenfuelcellexpandtolong-haulﬂights26•GaseoushydrogencombustionenginesAviationCapgeminiResearchInstitute202326Low-CarbonHydrogen:APathToAGreenerFuture03INVESTMENTINLOW-CARBONHYDROGENISONTHERISECapgeminiResearchInstitute202327Low-CarbonHydrogen:APathToAGreenerFutureOrganizationsareinvestingrenewable-hydrogenprojects.TheA$87million($60acrossthehydrogenvaluemillion)projectinWesternAustraliaincludesa10-MWchainelectrolyzertoproducerenewablehydrogen;an18-MWsolarPVsystemtopowertheelectrolyzer;andLeadingE&Uorganizationsareturningtowardslow-an8-MW/5-MWhlithium-ionbattery28carbonhydrogentotransformintointegratedenergy•EDFEnergy,alsoFrench-owned,hasfloatedtheideaofproviders.HydrogenproductioncapacityisestimatedproducinghydrogenatSizewellCintheUK,aplannedtoreach4.5milliontonsperannum(mtpa)worldwide3.2-GWnuclear-powerstation.29bytheendof2023.AsofJanuary2023,93percentofbothactiveandpipelinehydrogenprojectsweregreen-93%hydrogenprojects.27AsofJanuary2023,93%ofbothactiveandpipelineForinstance:hydrogenprojectsweregreenhydrogenprojects.•Frenchmultinationalutilitycompany,ENGIE,isinvestinginoneoftheworld’sfirstindustrial-scaleCapgeminiResearchInstitute202328Low-CarbonHydrogen:APathToAGreenerFutureOurresearchshowsthatamajority(64percent)ofFig.8E&Uorganizationsareplanningtoinvestinlow-AmajorityofE&Uorganizationsareplanningtoinvestinlow-carbonhydrogeninitiativescarbonhydrogeninitiativesby2030;and9in10plantodosoby2050(seeFigure8).%OFORGANIZATIONSTHATAREINVESTING/PLANNINGTOINVESTINLOW-CARBONHYDROGEN64%26%20302050ofE&Uorganizationsareplanningtoinvestinlow-carbonhydrogeninitiativesby2030202264%98%Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=447respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202329Low-CarbonHydrogen:APathToAGreenerFutureFig.9E&Uorganizationsaremakinginvestmentsacrossthelow-carbonhydrogenvaluechainOftheE&UorganizationsthatareplanningtoinvestinR&DandinnovationProductionStorageTransportandEnd-to-endvaluechainlow-carbonhydrogenby2030:distribution•Nearlythreeinfour(74percent)plantoinvestless%OFORGANIZATIONSINVESTINGORPLANNINGTOINVESTINDIFFERENTthan0.5percentoftheirexpectedrevenueAREASOFLOW-CARBONHYDROGENVALUECHAIN•Oneinfour(24percent)plantoinvest0.5–1percentof52%53%theirexpectedrevenue45%•Onaverage,0.4percentoftotalannualrevenueisearmarkedforlow-carbonhydrogenby15%E&Uorganizations7%OrganizationsarealsoincreasinglyrealizingtheneedtoacceleratecommercializationanddeliversignificantreductionsinCO2emissions;hence,massiveinvestmentisbeingmadeinthelow-carbonhydrogensupplychain,includingthedevelopmentofcost-effectiveproductiontechnology.Investmentshavebeenmade/plannedinareassuchaselectrolyzers,fuel-celltechnologies,refuelingnetworks,andhydrogeninfrastructuretohelpcreatealternativerevenuestreamsintheenergysector,aswellassupportdecarbonizationefforts(seeFigure9).Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202330Low-CarbonHydrogen:APathToAGreenerFutureResearch&development:Ourresearchfoundthat45important.ElectrolyzersarenotyetproducedatpercentofE&Uorganizationsareinvestinginhydrogen-scale,sothecostshoulddecrease,butwealsothinkrelatedR&D.Ofthose:thatinnovationiscrucial.Today,theefficiencyofelectrolyzersisjust60–65percent.Weneedtohave•Morethan70percentrankedelectrolyzertechnologyhigherefficiencyinordertoreducetheelectricityenhancement(includingalkaline,proton-exchangeusedtoproducelow-carbonhydrogeninacost-membrane[PEM],anionexchangemembrane[AEM],effectiveway.”InMay2022,Hysata–anelectrolyzerandhigh-temperatureelectrolyzerssuchassolid-oxidetechnologycompanybasedinAustralia–developedelectrolysiscell[SOEC])amongthetopfivetechnology-acutting-edgetechnologyinwhichtheelectrolyzerenhancementinvestmentareas.In2020,Spanishoperatesat95-percentsystemefficiency.31electricutilitycompany,Iberdrola,establishedaseparatecompany–Iberlyzer,dedicatedtoelectrolyzer–R&Dforreplacementofrare-earthmetalstechnology.30Organizationsarefocusingon:(suchasplatinum,iridium,ruthenium,etc.)usedinelectrolyzers.Extractingtheserare-–Improvingefficiencyandscalingproduction.earthmetalsalsoposesseveralchallenges,suchPaolaBrunetto,HeadofHydrogenBusinessUnitastheenvironmentalcostofminingalongwithatEnelGreenPower,says:“Toreducethecostofgeopoliticalchallengesassociatedwiththelocationlow-carbonhydrogen,afocusoninnovationisveryCapgeminiResearchInstitute202331Low-CarbonHydrogen:APathToAGreenerFutureofthesemetals.AnexecutiveatIndiabased(amixofhydrogen,carbonmonoxide,carbondioxide,steelorganization“InIndia,anotherbigissueforandmethane).COOatH2EnergyGroupDonTurnerelectrolyzersistherare-earthmetalsusedinthem.adds:“ThesyngascaneithergothroughageneratororaWehavetoimporttheserare-earthmetals–whichisturbinetoproduceelectricityorapostprocesstoproduceanothercost,aswellasatechnicalchallenge.”Hydrogen.Thepostprocessessentiallyinvolvesapressureswingadsorptiontopurifythehydrogento99.999%.We•Organizationsareexploringothertechnologies,suchalsoabsorb13.2tonsofCO2inourenergygrassperacreasthermolysisorusageofbiomass,forhydrogenperyear.Fifteenpercentofallinputtedbiomasscomesproduction–thisisrankedamongthetopfiveR&Doutasbiocharfromthereactor.Biocharcomingoutofprioritiesby69percentofE&Uorganizations.USreactorsisessentiallyhighlyporouspurecarbonthatcanoilgiantChevronrecentlycommitted$25millionbeusedforlivestockfarmingasfeedsupplement,aswelltoaCaliforniagreenwaste-to-hydrogenproject.32asinagriculturetopromotesoilhealth.ItalsorepresentsHouston-basedArborRenewableGasproducesafeedstockforthemakingofgraphene–oneofthemostrenewablegasolineandlow-carbonhydrogenfrompromising"supermaterials.”gasificationofwoodwasteandforestresidue.33US-basedH2EnergyGroupuseswoodybiomassinapyrolysisprocessthatproduceshydrogen-richsyngasCapgeminiResearchInstitute202332Low-CarbonHydrogen:APathToAGreenerFuture•Fifty-ninepercentalsorankedfuelcellsamongtheProduction:AsignificantproportionofE&UStorage:Hydrogenmustbestoredeitherathightopfiveinvestmentareas.Ourrecentresearchonorganizationsgloballyaredevelopinginfrastructurepressureoratlowtemperature,whichiscostlyandResourcesAwarenessandCircularEconomyStrategytosupportproductionoflow-carbonhydrogen.BPistechnicallychallenging.Ourresearchrevealsthat,ofthe(RACES)showcasingmeritordersinautomotivealsoleadingthe$36billionRenewableEnergyHubprojectinE&Uorganizationsinvestinginstoragetechnologies:highlightsthecriticalityofhydrogenfuelcellelectricWesternAustralia’sPilbararegiontoinstall26GWofsolarvehicles(FCEVs).Theresearchshowsthathydrogenandwindfarms.Atfullcapacity,itwillproducearound•Fourin10(41percent)prefercompressedgaseousvehiclesarelessresource-criticalperkmthanbattery1.6MMtofhydrogenor9MMtofgreenammoniaperhydrogenasthestoragemode;SalahMahdy,Globalvehicles,butthehydrogenconsumedinFCEVsisyear.34AirProducts,alongwithglobalenergycompanyDirector–RenewableHydrogenatHowden,aglobalmorecriticalthanelectricity.AESCorporation,planstobuilda$4billionlow-carbonleaderofhydrogencompressionsolutions,says:hydrogenplantinTexas,thebiggestsuchplantintheUS,“Therearethreemajortechnologyareasthatarewithcapacitytoproduce200Mtofhydrogenaday,ascriticaltocostreductionofhydrogen:powergeneration,wellas1.4GWofwind-andsolar-powergeneration.35electrolyzers,andcompression.Wespecializeindevelopedhighlyinnovativecompressionsolutionsforourcustomersfocusedonoptimizingtheavailabilityandreliability,whichresultsinreducingtheTCO(totalcostofownership)ofourcustomers’operations.”CapgeminiResearchInstitute2023“Toreducethecostoflow-carbonhydrogen,a33focusoninnovationisveryimportant.Today,Low-CarbonHydrogen:APathToAGreenerFuturetheefficiencyofelectrolyzersisjust60–65percent.WeneedtohavehigherefficiencyinPaolaBrunettoordertoreducetheelectricityusedtoproducelow-carbonhydrogeninacost-effectiveway.”HeadofHydrogenBusinessUnitatEnelGreenPowerCapgeminiResearchInstitute202334Low-CarbonHydrogen:APathToAGreenerFuture•Nearlyaquarter(24percent)areexploringliquefied-Transportationanddistribution:WhilehydrogenammoniaormethanolfromsouthernSpaintonorthernhydrogen-storagetechniquescanbetransportedviaroad,rail,water,orpipelines,Europethroughthefirst“greenhydrogencorridor.”38costscanvarysignificantly.Accordingtoanalysisfrom•19percentareinvestinginliquidorganichydrogenBloombergNEF,transportinghydrogenbypipelineoverOfE&Uorganizationsinvestingorplanningtoinvestincarriers(LOHC)technologies100kmwouldcostamaximumof$0.23/kg;thesametransportationanddistributionoflow-carbonhydrogen,operationbyroadcouldcostasmuchas$1.73/kg.37one-third(33percent)areplanningtoexploreexisting•Theremaining16percentareexploringderivatives,natural-gaspipelinesforhydrogendistribution.ThesuchasammoniaormetalhydridesSpanishoilandgasgroupCepsahasrecentlysignedaEuropeanHydrogenBackbone(EHB)initiativeconsistingdealwiththeDutchportofRotterdamtoshiplow-carbonagroupofthirty-twoenergyinfrastructureoperatorsOrganizationsarealsoexploringthepotentialofhydrogenintheformofhydrogenderivativessuchasexpecttore-purpose69%ofnaturalgaspipelinestoundergroundhydrogen-storagefacilities.MitsubishitransporthydrogenacrosstheEuropeby2040.39PowerAmericasalongwithMagnumDevelopmentaresettobeginconstructionofa300-GWhundergroundhydrogen-storagefacilityintheUS.36CapgeminiResearchInstitute2023CédricVanHoonacker,KeyAccountManagerfor35NextgridH2&CO2atFluxys,aBelgium-basednatural-Low-CarbonHydrogen:APathToAGreenerFuturegastransmissionsystemoperator,comments:“Pipelinetransportoffersacost-efficientsolutiontoconnectareasofCapgeminiResearchInstitute2023hydrogenexcesssupplywithregionswithhydrogendemand.Wearealreadylookingatrepurposingofnatural-gaspipelines.AsmentionedinhydrogenstrategyandstudiesattheEuropeanlevel,by2050,75percentofthehydrogengridwillconsistofrepurposednatural-gaspipelines.”ItappearsfromoursurveythatthetopthreeinvestmentprioritiesforE&Uorganizationsinthetransportationanddistributionareaare:•ImprovingdistributionnetworksforH2transport•Safehandlingofhydrogen•Managingleakages,ashydrogenleakageswillalsohaveanimpactonatmosphericcomposition,aswellasanindirectwarmingeffectontheclimate4036Low-CarbonHydrogen:APathToAGreenerFuture“ThesyngascaneithergothroughageneratororaDonTurnerturbinetoproduceelectricityorapostprocesstoproduceHydrogen.ThepostprocessessentiallyinvolvesCOOatH2EnergyGroupapressureswingadsorptiontopurifythehydrogento99.999%.Wealsoabsorb13.2tonsofCO2inourenergygrassperacreperyear....”CapgeminiResearchInstitute202337Low-CarbonHydrogen:APathToAGreenerFutureCountriesacrosstheglobeandmaximizeeconomiesofscale.Moreover,policiesandhavesetambitioustargetsregulationsaremakingitmoreprofitableforprivate-forlow-carbonhydrogensectorcompaniestoinvestinlow-carbonhydrogen.Forinstance,theEUapproveda€5.2billionpublicgranttoDevelopingahomegrownnationalhydrogenindustrysupporthydrogenprojects.Thisisprojectedtounlockpresentsatripartitechallenge:41anadditional€7billionininvestmentfromtheprivatesector.42•Environmental:toreduceGHGemissionsandfulfillnetzeroanddecarbonizationcommitmentsIntotal,80countriesaresupportingclean-hydrogenproduction.Below,wehighlightafewkeyinitiativesin•Economic:tocreateaddedvalueandjobsvariousgeographies.(NB:thelistbelowisnotexhaustive•Sovereignty:todevelopenergyindependence,orevenforanycountry/region.)Morethan80anewexportableresourcecountriesaresupportingclean-hydrogenproduction.Countriesareinvestinginbothsupply-anddemand-sidefacilitiesand“hydrogenhubs”tocreatesupplychains,lowercosts,promoteassetsharingandcollaboration,CapgeminiResearchInstitute202338Low-CarbonHydrogen:APathToAGreenerFutureTheEU’shydrogenroadmapto2050:In2020,theEuropeanCommissionlauncheditsTHEEU’SHYDROGENROADMAPTO2050:ambitioushydrogenstrategyforaclimate-neutralEurope,whichsetsoutaplantoestablishan202024202530203050integratedhydrogen-energynetworkinEuropeby2050.43•Inthisphase,theEUwill•Inthisperiod,theEUwill•From2030onwards,focusoninstallationoffocusonmakingtheEUaimstodeployThistransformationisacceleratingfollowingtheatleast6GWofhydrogenintrinsictothegreenhydrogeninallpublicationoftheREPowerEUplaninMay2022,renewablehydrogenbloc’sintegratedenergylarge-scalewhichproposesareductionofEUdependenceonelectrolyzersandsystem,whichaimstohard-to-decarbonizeRussianfossilfuelsbyacceleratingseveralclimate-productionofupto1installatleast40GWofsectors.relatedtargets.REPowerEUsetsatargetof10MtofMtofrenewablerenewable-hydrogendomesticrenewable-hydrogenproductionand10Mthydrogen.electrolyzersandtorampofrenewablehydrogenimportsby2030.44Moreover,uphydrogenproductionEU’sRenewableEnergyDirectivedefineshydrogento10milliontonnesbyproducedbyrenewables-basedelectricityand2030.liquidfuels,suchasammonia,methanolore-fuelsproducedfromrenewablehydrogenasRFNBOs(renewableliquidandgaseousfuelsofnon-biologicalorigin),whichwillaidingrowthoflow-carbonhydrogenanditsderivatives.45CapgeminiResearchInstitute202339Low-CarbonHydrogen:APathToAGreenerFutureSelectedcountry-specificinitiatives–Europe:Overthecomingeightyears,Franceintendstospend€9billiontoencouragethetransitionofheavyindustrytohydrogen,includingscalingnationalgreen-hydrogenproductionto6.5GWby2030.46In2021,theGermangovernmentsetuptheH2Globalinitiativeforgreen-hydrogenimportsproducedoutsidetheEU.Itfeaturesacontractsfordiﬀerence(CfD)thatoﬀerscompensationforalimitedtimeforthediﬀerencebetweenthepurchaseprice(productionplustransportcosts)andthesaleprice(thecurrentmarketpriceforfossilhydrogen)ofrenewablehydrogenandderivedproducts.47TheUKplanstoinvest£4billion($4.8billion)increatingalow-carbonhydrogenindustryby2030.Itistargeting5GWofannualproductioncapacity,suﬃcienttopoweraround3millionhomes,aswellasheavyindustry.48Spainintendstoinvest€1.5billiontodevelopgreenhydrogenproductionoverthenextthreeyears.49TheBelgiangovernmenthasinvested€95million(around$100million)intheconstructionofahydrogenandCO2pipelinenetwork.Ithasalsoearmarkedanannualbudgetof€25millionforR&Dand€16millionforthecreationofahydrogenexpertisecenterin2022.Belgium'shydrogenstrategyfocusesonfourpillars:positioningthecountryasanimportandtransithubforrenewablesinEurope;developingBelgianleadershipinhydrogentechnologies;establishingarobusthydrogenmarket;andfocusingoncollaborationandcooperation.50CapgeminiResearchInstitute2023SelectedinitiativesinNorthAmerica40Low-CarbonHydrogen:APathToAGreenerFutureUSCapgeminiResearchInstitute2023•TheUSDepartmentofEnergy(DOE)hasinitiatedan$8billionprogram(expectedtobeawardedinsummer2023basedontheapplications)todevelopahubnetwork(H2Hubs)forproducingcleanhydrogen.51Thenetworkwillconnecthydrogenproducers,consumers,andlocalinfrastructure.ByNovember2022,applicationsfornearly$60billiontotaloffederalfundingwerereceivedfromorganizationsthatarewillingtoinvest$150billionoftheirowncapital.52•UndertheInﬂationReductionAct(IRA)of2022,aproductiontaxcreditforcleanhydrogenwasissued,withthecreditamountvaryingaccordingtothecarbon-intensityofhydrogenproduced,withamaximumcreditrateof$3/kgforthelowest-carbonhydrogen.53•Anindustryconsortium,OpenHydrogenInitiative(withE&UorganizationssuchasEQT,Exxonmobil,NationalGrid,andShellasfoundationalsponsors)hasbeenformedtomeasureandcertifythecarbonintensityofhydrogenattheproductionplantlevel.54CANADA•TheGovernmentofCanada’sCleanFuelsFundwillinvestCA$1.5billion($1.1billion)tobuildneworexpandexistingproductionfacilitiesforcleanfuel,includinghydrogen.55•CanadianfederalandprovincialgovernmentshavealsoannouncedapproximatelyCA$475millioninprojectfundingforAirProducts'netzerohydrogenenergycomplexinAlberta.•TheHydrogenStrategyforCanada,2020outlinesastrategytocreateaCA$50bndomestichydrogenmarket.Speciﬁctargetsincludemakinghydrogen30%oftheenergymixby2050atacostof$1.20–2.80/kg.5641Low-CarbonHydrogen:APathToAGreenerFutureSelectedinitiativesinAPAC:INDIAAUSTRALIAJAPAN•Indiahasapproveda$2.4billion•TheAustralianRenewableEnergy•Japan'sMinistryofEconomy,NationalGreenHydrogenmissionAgency(ARENA)hasannouncedaTradeandIndustry(METI)toboostproduction,utilization,furtherA$50minfundingacrossproposedtoallocate¥300billionandexportationofgreenfourhydrogenprojectslisted($2.3billion)tothedevelopmenthydrogenanditsderivatives.TheundertheGerman-Australianofthehydrogenimportationandmissionexpectstorealize125HydrogenInnovationandsupplychain.GWofrenewableenergy.57TechnologyIncubator(HyGATE)initiative.Germanyinvestedan•Inaddition,¥70billionistobe•TheIndiangovernmentexpectsadditional€40minthejointusedtodeveloplarge-scaleindustrytoinvest₹8trillion($96initiative,focusedonestablishingelectrolyzerprojectsforbillion)ingreenhydrogenanditsagreen-hydrogensupplychain.59hydrogenproduction.60derivative,greenammonia,by2030.58CapgeminiResearchInstitute202342Low-CarbonHydrogen:APathToAGreenerFuture04COST,ENGINEERING,ANDSKILLSCHALLENGESAREYETTOBEADDRESSEDCapgeminiResearchInstitute202343Low-CarbonHydrogen:APathToAGreenerFutureFig.10AmajorityofE&Uandend-userorganizationsarestillattheinitialstagesoftheirlow-carbonhydrogeninitiativesOurresearchsuggeststhat64percentofE&UCURRENTBUSINESS-READINESSCURRENTTECHNOLOGY-READINESSorganizationswillbeinvestingsignificantlyinlow-LEVELOFLOW-CARBONHYDROGENLEVELOFLOW-CARBONHYDROGENcarbonhydrogenby2030.However,amajorityoforganizationsarecurrentlyatproof-of-conceptPROJECTSPROJECTS(PoC)orpilotstages.Figure10highlightsthecurrentmaturityofE&Uandend-userorganizationsontheir42%low-carbonhydrogenjourneys.33%33%32%33%Highproductioncosts,lowenergyefficiency,anda30%30%lackofinfrastructureandskilledresourcesarethecurrentbarrierstolow-carbonhydrogenscalability.24%Wediscussthesechallengesindetailbelow.19%12%11%13%19%12%8%10%13%8%11%7%InitialTeambuiltMVPcreatedScaledFullyembeddedTechnologyExperimentalTechnologySystemmodelActualconceptandplaninmarketconceptproofvalidatedinorprototypesystemdeﬁnitiondevelopeddemonstrationproveninoroﬀeringsformulatedofconceptrelevantinoperationaloperationalformulatedenvironmentenvironmentenvironmentE&UorganizationsEnd-userorganizationsE&UorganizationsEnd-userorganizationsSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202344Low-CarbonHydrogen:APathToAGreenerFutureThecostoflow-carbon•Syntheticfuelsforaviationarecurrently3–6timeshydrogeniscurrentlyhighmoreexpensivethanjetfuelfromfossiloilThecostofproducinglow-carbonhydrogenismainly•Thecostpremiumforlow-carbonhydrogencomparedbasedonthreefactors:thecostoftheelectricitythattofossil-basedoptionscanbe50–75percentforpowerstheelectrolyzers;thecostofinstallingtheammonia,150percentformethanoland30–40percentelectrolyzers;andfinally,theloadfactorresultingforsteelfromtheintermittencyofrenewableresources.Fallingrenewable-energyprices,coupledwithimprovementsin•Producinglow-carbonhydrogenismuchmoreelectrolyzertechnology,haveincreasedthecommercialresource-criticalperkWhthanproducinganyotherviabilityoflow-carbonhydrogen.However,itstillcoststypesofenergiesduetochallengesassociatedwith$5–6perkgtoproduce.Comparinglow-carbonhydrogenprocurement,technology,andenvironmentalimpact.tootherfuels,asperestimates:61Formoredetailsonmeritordersinenergy,pleaserefertoourpublishedreport:RACES:ResourcesAwareness•Itis2–3timesmoreexpensivetoproducethanfossilandCircularEconomyStrategy.fuels(consideringlong-termaveragefossil-fuelpricesof$75/barrelforoiland$4–6/gigajoulefornaturalgas)•FuelcellsandstoragetanksforroadtransportaresignificantlymoreexpensivethaninternalcombustionenginesCapgeminiResearchInstitute202345Low-CarbonHydrogen:APathToAGreenerFutureFigure11highlightstheglobalaveragelevelizedcostofFig.11hydrogen(LCOH),byenergysource,in2020.Low-carbonLow-carbonhydrogenisnotyetcost-competitivehydrogenisaroundthreetimesmoreexpensivethancarbonizedhydrogen.AVERAGEHYDROGENPRODUCTIONCOSTBYPRODUCTIONTECHNOLOGY,2020(IN$/KG)Low-carbonRenewableelectrolysis5.96hydrogenNuclearelectrolysis5.58SMRalongwithCCUS2.272.082–3SMR1.34Low-carbonhydrogenis2–3timesmoreCoalgasiﬁcationexpensivethancarbonizedhydrogen.Source:IEA,GlobalDataPowerWebinar-HydrogenMarket,“Ridingthesustainabilitywave,”February3,2022.CapgeminiResearchInstitute202346Low-CarbonHydrogen:APathToAGreenerFutureFig.12Organizationsarefacingcost-relatedchallengesthroughoutthehydrogenvaluechainTOPCOST-RELATEDCHALLENGESBYVALUECHAINSTAGER&DandinnovationProductionStorageTransportationUsageanddistributionHighcostof64%Highcostof62%low-carbon-buildingnew62%Highcapitalcost46%hydrogenHighcostof79%hydrogen-HighTCOfor81%ofelectrolyzerproductioninstorage(costcompatiblelow-carbonunitsalternativeareasofatank,infrastructurehydrogen(e.g.,settingupoptimizingoﬀshoreproductionvolume,Highcostoffacilitiesduetodurability,etc.)transportationunavailabilityofland)ofgaseoushydrogenHighcostof51%renewableelectricitySource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202347Low-CarbonHydrogen:APathToAGreenerFutureAmidsoaringnatural-gasprices,thecompetitivenessofasproductionscales.63Forinstance,inChina,thelow-carbonhydrogenhasimprovedslightly;however,productionofalkalineelectrolyzerscostsone-fifthrisinginflationandcostofmaterialshavecontributedtohalfofthatinEuropeorNorthAmerica.64ThetohigherCAPEXforprojects.Asperoursurvey,costofelectrolyzerstackreplacementisalsoamajororganizationsfacecostpressuresthroughoutthecomponentforOPEX(typicallyrequiredafteraroundhydrogenvaluechain(seeFigure12).60,000hours).•R&Dandinnovation:Producingandoperating•Production:Inourresearch,morethanhalf(51electrolyzersiscurrentlyexpensiveowingtolowpercent)ofE&Uorganizationsrankedthepriceoftechnologyefficiency;thelargeamountofraremetalsrenewableenergyamongthetopthreeobstaclesrequiredforelectrolyzermembranes;andthelackoftothecommerciallyviablescalingoflow-carbonscaledproduction.AccordingtoIEAestimates,CAPEXhydrogen.requirementsarecurrentlyintherangeof$500–1,400/kWeforalkalineelectrolyzersand$1,100–1,800/kWeAvailabilityofgreenelectricityalsoneedstobeforPEMelectrolyzers,whiletherangeforsolid-oxideensured.FortheEUtoreachitshydrogenobjectives,electrolyzercells(SOEC)is$2,800–5,600/kWe.62Initmustadd40GWofrenewablescapacityby2026,ourresearch,46percentofE&Uorganizationsrank–achallengingtarget.Includingnuclearelectricityhighercapitalcostofelectrolyzersamongtheirtopsourcesforlow-carbonhydrogenproductioncanthreeR&Dchallenges.Analystsexpectthecapitalcostofelectrolyzerstodropby30percentby2025,CapgeminiResearchInstitute202348Low-CarbonHydrogen:APathToAGreenerFuture62%helptoovercomethesedifficulties.Moreover,transportationofhydrogeninitsgaseousstateamongconsideringbackupenergyforlow-carbonhydrogenthetopfivetransportationchallenges.ofE&Uorganizationsrankthehighcostofmanufacturingcanhelpinflatteningoutpeaksandbuildinghydrogen-compatibleinfrastructuretroughsinrenewableenergyproduction.Recently,•Endusage:Amongendusers,totalcostofownershipamongthetopfivetransportationchallenges.energyconversionequipmentspecialistIngeteamhasisthemainchallenge.Anexecutiveataglobalsuppliedabatteryenergystoragesystem(BESS)forautomotiveorganizationsays:“YouneedtomakealotIberdrola’sPuertollanofacilityinSpain–oneoftheofinvestmenttochangethehardware.Processessuchasworld’slargestoperationalgreenhydrogenplants.65heating,wherewecurrentlyusenaturalgas,cannotsimplyswitchbecauseofthedifferentcalorificvalueofhydrogen,•Storage:Hydrogen’slowmolecularweightandlowdifferentleakageproblems,differentpressures,andsoon.”energycontentbyvolumemakestorageexpensive–alargemajority(79percent)ofE&Uorganizationsrankthisamongtheirtopfivestorage-relatedchallenges.•Transportation:Inourresearch,around60percentofE&Uorganizationsrankthehighcostofbuildinghydrogen-compatibleinfrastructureandhighcostofCapgeminiResearchInstitute2023“Wespecializeindevelopedhighlyinnovative49compressionsolutionsforourcustomersLow-CarbonHydrogen:APathToAGreenerFuturefocusedonoptimizingtheavailabilityandreliability,whichresultsinreducingtheTCOSalahMahdyofourcustomers’operations.”GlobalDirector–RenewableHydrogenatHowdenCapgeminiResearchInstitute202350Low-CarbonHydrogen:APathToAGreenerFutureManyexpectimprovedeconomicFig.13viabilityoflow-carbonhydrogenAmajorityoforganizationsinourresearchexpectthecostoflow-carbonhydrogentodecreasesteadilyto2040%OFORGANIZATIONSANTICIPATINGLOW-CARBONHYDROGENPRODUCTIONCOSTSTODECREASESTEADILYBY...1%8%5%10%4%3%4%32%13%16%16%4%13%13%24%28%16%30%20%29%28%26%26%28%36%31%21%8%24%35%4%37%37%9%Nordics4%62%58%UK63%54%48%48%47%49%52%7%38%2%43%8%3%12%13%8%4%12%8%Canada13%2%Japan5%Australia2%Italy2050IndiaNetherlandsSpainFranceAverageUS2030Germany203520402045Don'tknow/Can'tsaySource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202351Low-CarbonHydrogen:APathToAGreenerFutureFig.14Organizationsseeimprovementsinelectrolyzers,afallingcostofrenewables,andscaledvolumesaskeycost-reductionleversOrganizationsandresearchersarealsodependingon%OFORGANIZATIONSAGREEINGTHATTHEBELOWARECOST-REDUCTIONLEVERSfavorableregulatorymeasuressuchascarbontaxesorFORLOW-CARBONHYDROGENrenewable-energyincentivestofacilitatethisshift.Forinstance:Improvingelectrolyzertechnology65%Productionofhydrogenforexampleat65%•TheEuropeanCommissionoffersCarbonContractsfor64%Difference(CCfD)subsidiesforgreenhydrogenthroughrenewable-energysites63%itsInnovationFund.Theprogramsupportsacomplete63%switchfromnaturalgastorenewablesinproducingReductionincostofgreen-electricityproduction60%H2.UndertheCCfDscheme,EUgovernmentswillpayendusers,nottheproducers,acertainamountfornotReductioninthecostoftransportationemittingcarbon.66Increasingmodulesize(production-facilitysize)•TheEU’sCarbonBorderAdjustmentMechanism(CBAM),oflow-carbonhydrogenproductionwhichwillbeapplicablefromOctober1,2023,issettoapplyacarbonbordertaxonimportsofcarbon-Large-scalehydrogenvolumesintensivehydrogenandH2-derivedproductssuchasammoniaandmethanol.UndertheCBAMscheme,importersoftheseproductswillberequiredtopaythedifferencebetweencarbontaxespaidinthecountryoforiginandthepriceofemissionsallowancesunderEurope’scarbon-tradingscheme,theEmissionsTradingSystem(ETS).67Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202352Low-CarbonHydrogen:APathToAGreenerFutureFig.15EnergylossesacrossthevaluechainareachallengeforendusersandE&UorganizationsEngineeringchallengesare%OFORGANIZATIONSRANKING“HIGHENERGYLOSSESATEVERYPOINTOFyettobesolvedacrosstheTHESUPPLYCHAIN”AMONGTHEIRTOPFIVECHALLENGESvaluechain74%Costchallengesaside,forlarge-scalecommercializationanddeploymentoflow-carbonhydrogen,various65%engineeringchallengesmustbesolved.59%•Energylossesacrossthevaluechain:Reducingenergylossesisakeychallengefromaninnovation54%55%53%perspective:6851%–30–35percentoftheenergyusedtoproducehydrogenislostduringelectrolysis39%42%37%–13–25percentofenergylossesoccurwhileliquefyingAverageHeavy-dutyAviationMaritimeSteelPetroleumChemicalsAverage–EnergyUtilitieshydrogenorconvertingintoothercarrierssuchas(reﬁning)&fertilizersEnergy&ammonia–Endtransportationtransportationutilities–Transportinghydrogenrequiresadditionalenergyusersinputs,typicallyequalto10–12percentofthehydrogen'sownenergycontent–Usinghydrogeninfuelcellsresultsinanadditional40–50percentenergylossNote:Figureshighlightedintheabovegraphareaspersurveyrespondents'viewsexclusivelyabouttheirownsector.Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202353Low-CarbonHydrogen:APathToAGreenerFutureAsfigure15shows,59percentofend-user•Engineering-andinfrastructure-relatedchallenges•Requiredspecificityofstorageconditions(suchorganizationsand39percentofE&Uorganizationsarise:Efficiency,deterioration,durability,resilience,ashighpressure,cryogenictemperature,etc.)(69seethisasaconsiderablechallenge.Organizationsaredensity,electrical-powercapacity,electrolysis-gradepercent)exploringdigitaltechnologiestomitigatethischallengewateravailability,aswellascommonengineeringandgrowthehydrogeneconomy.Wetalkabouttheminlow-carbonhydrogenstandardsavailabilitymustall–Infrastructurerequirementsfortransportinganddetailinthenextsection.beaddressedacrossthevaluechainforlow-carbondistributinghydrogenarecrucial:hydrogentobeviable:72%•Nearly7in10(68percent)E&Uorganizations–Highenergyconsumptionduringproductionisrankedinvestinginlow-carbonhydrogentransportofE&Uorganizationsbelievedigitaltechnologiesamongthetopfiveproductionchallengesbyhalfofrank“insufficientexistinghydrogenpipelinesuchasAI,ML,IoT,digitaltwinswillbeakeyenablerE&Uorganizationsinfrastructure”amongthetopfivechallengestooptimizeRoIforlow-carbonhydrogenprojects.–Withhydrogenbeingahighlyvolatile,combustible•Researchisalsoongoingintousingexistinggasgaswithaverylowenergycontentbyvolume,storagepipelinesforhydrogentransportbyblendingandpresentssignificantchallenges:deblending;ifsuccessful,thiscouldhelpabsorbpricepressuresduringtheinitialphaseofthe•Highflammabilityraisingsafetyconcerns(rankedhydrogeneconomyamongthetopfivechallengesby81percentoforganizations)•Policysupportisalsorequiredhere,as65percentofE&Uorganizationsinvestingintransportationrank•Lowdurabilityofstoragematerials–suchasfiber,“government-authorizedstoragesitesbeingfarfrommetals,polymers,etc.(72percent)consumptionsites”amongthetopfivechallengesCapgeminiResearchInstitute202354Low-CarbonHydrogen:APathToAGreenerFutureFig.16Amajorityofend-userorganizationsrankinfrastructureandengineeringissuesamongthetopfivechallengesfortheirsectorHeavytransportAviationMaritime–Certifications:Alackofinternationalstandardson•Needtoscaleup65%•Modiﬁcationsinaircraft58%•Volumeofstoragespace55%proofoforiginisachallenge.TheUKgovernment,productionofhydrogen63%designrequiredforuserequiredforhydrogenforinstance,isseekingindustryviewsonthefuelcellsoflowcarbonhydrogenfuelcellsoncargovesselsdesignofa"globallyrecognized"certificationasfuel,etc.schemeforlow-carbonhydrogenintheUK,to•Lackofrefuelingbuildtransparencyandconfidenceinthecarboninfrastructurecredentialsofhydrogen.69IndustryplayerssuchasExxonMobil,NationalGrid,DukeEnergy,Equinor,SteelPetroleumChemicalsandothershaveformedaworkinggroupcalledtheOpenHydrogenInitiative(OHI)todevelopthe•Signiﬁcantinfrastructure72%•Safetyconcerns85%•Highsensitivityto81%modelsthatwillbeusedforhydrogencertification.70upgraderequiredfor78%feedstockpriceslarge-scale•RequirementforFormoredetailsonengineeringchallenges,pleasereferhydrogen-basedsteelcontinuoussupplyoftoourrecentlypublishedresearch:productionhydrogen(notguaranteedUnlockingthehydrogenage.Theseinfrastructureandwithlow-carbonengineeringchallengesalsoimpactendusers.Welistthehydrogen)top-rankedchallengesbyend-usersector(seeFigure16).Note:Thefigurehighlightsthepercentageofenduserorganizationsrankingthesaidchallengeamongtop5hydrogenchallengesfortheirrespectivesector.Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations.CapgeminiResearchInstitute2023“Digitaltechnologiesarecrucialtothe55hydrogenvaluechain–forsurveillanceofLow-CarbonHydrogen:APathToAGreenerFuturesystems;earlydetectionoffaultsandleaks;continuouscost-optimization,etc.IntheThomasHolmdevelopmentphase,digitaltwinsandaccuratemodelingaregoingtogainimportance.”HydrogenresearcherfromtheInstituteforEnergyTechnology,NorwayCapgeminiResearchInstitute2023Organizationsfacecritical-56skillshortagesLow-CarbonHydrogen:APathToAGreenerFutureOurpreviousresearchonnew-energybusinessmodelsCapgeminiResearchInstitute2023foundthatthetransitiontoalternativedecarbonizedbusinessmodelsisbeinghindered:nearly70percentoforganizationscitealackofcapabilitiestodevelopnew-energybusinessmodels,whilearound62percentreportadeficitinin-houseskillsets.71AnalysisbytheUKDepartmentforBusiness,Energy,andIndustrialStrategy(BEIS)suggeststheUKhydrogenindustrycouldsupport12,000jobsby2030,and100,000jobsby2050acrossproduction,transport,andstoragetechnologiesfordomesticandexportmarkets.However,industryexpertsestimatetheretobe1,000–2,000individualsintheUKwhohaveveryspecific57Low-CarbonHydrogen:APathToAGreenerFutureFig.17Sixin10endusersandnearlyhalfofE&Uorganizationsrecognizelackofrequiredskills,expertise,andtrainingasachallengehydrogen-relatedskills.72Moreover,withapplications%OFORGANIZATIONSRANKING"LACKOFSKILLSANDEXPERTISE"AMONGTHETOPandusecasesofhydrogenextendingtovariousFIVECHALLENGESFORTHEIRORGANIZATIONINLOW-CARBONHYDROGENINITIATIVESindustries,hydrogentalentandskillsdemandisonlygoingtogrowfurther.70%67%67%63%65%63%67%62%60%58%Inourresearch,amajorityoforganizationsranklackof58%52%52%52%48%50%50%skillsandexpertiseamongthetopfivechallengesto49%48%48%53%40%48%40%scalehydrogen.47%Otherchallenges,suchasthelackofatransparent,32%open,andorganizedmarkettoenabletheexchangeofhydrogen,alsohinderscale.Despitethesechallenges,low-carbonhydrogencanplayacriticalroleinenergytransitionanddecarbonization.AverageSpainItalyNetherlandsCanadaUSUKAustraliaGermanyJapanIndiaFranceNordicsEnd-userorganizationsE&UorganizationsNote:EnduserdataforNetherlands,SpainandItalyisanalyzedatalowbaseSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations,N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202358Low-CarbonHydrogen:APathToAGreenerFuture05HOWCANENERGYANDUTILITIESORGANIZATIONSCAPITALIZEONTHELOW-CARBONHYDROGENOPPORTUNITY?CapgeminiResearchInstitute202359Low-CarbonHydrogen:APathToAGreenerFutureToseizetheopportunitiesinlow-carbonhydrogen,•Partnerecosystem:Howdoweselectapartner?Whatmitigatecosts,andscaleatpace,organizationswillneedwillbetherespectiveroles?Howdowedesignandtoansweranumberofquestions:implementprojectsinunprecedentedecosystemconfigurations(largegroups,smallandmedium-sized•Strategic:Howtoestablishthebusinesscaseforenterprises(SMEs),startups,localauthorities,etc.)?hydrogen?Whichmarkets,segments,orusecasesHowdowesecureareliablepartnershipnetwork?shouldwetarget?Howtotransitiontoanewbusinessmodel?WhatshouldbethegovernanceandoperatingWiththesekeyquestionsfrontofmind,anddrawingonmodel?Whichskillswillberequiredtosucceedandoursurveyanalysisandinterviews,aswellasourownhowtorecruitandtrainworkersinthem?experienceinthisarea,werecommendthefollowingstepstocapitalizeonthegrowinglow-carbonhydrogen•TechnologicalandIT:Whichsolutionstoselect?Areopportunity:theysufficientlymature?Howtoimplementthem?Howtodevelopandscalethemuptoanindustriallevel?Whichsteeringandsimulationtoolsshouldweselect?CapgeminiResearchInstitute202360Low-CarbonHydrogen:APathToAGreenerFutureFig.18Actionsforscalinglow-carbonhydrogeninitiatives•Tailorthebusiness-caseassessmenttoyourorganization•Establishgovernancemodelstosupportnewbusinessmodels•Establishhydrogen-competencecentersforskillsdevelopmentSTRATEGIZEAccelerate•Clearlyarticulatepartnershipstrategyandandscale•Harnessthepotentialofdigital-twindesignappropriatetrade-oﬀswhilelow-carbontechnologiestoreducecostandpartneringwith:hydrogenoperationalrisks-Primaryenergyproducers•Developrobustdataandtechnologyfoundationstomaximizeagilityand-EquipmentsuppliersCOLLABORATEACTIVATEresilienceinthesupplychain-Storage-systemdevelopers-Infrastructureproviders-Endusers-End-to-endvaluechainSource:CapgeminiResearchInstituteAnalysis.CapgeminiResearchInstitute202358%1.Strategize:Align61organizationalstrategyandLow-CarbonHydrogen:APathToAGreenerFutureoforganizationsbelievethatthecleancapabilitiestodevelopnewhydrogeneconomywillcreatewealthandbusinessmodelsCapgeminiResearchInstitute2023substantialjobopportunitiesTailorthebusiness-caseassessmenttoyourorganization:Low-carbonhydrogentechnologyrequiresimprovementandscalinguptocontributepositivelytooverallcostreductions.Inparallel,thereisarequirementtoevaluatenewbusinessmodelsfromsustainabilityandTCOstandpoints.DetailedanalysisofbothCAPEXandOPEXisrequired.Assessandmonitorregulatorydevelopments:Asmentionedpreviously,governmentsacrosstheworldarefocusingheavilyondecarbonizedhydrogenthroughinvestments,low-carbonhydrogensubsidies,emissiontradingschemes,carbontaxes,etc.The62Low-CarbonHydrogen:APathToAGreenerFutureregulatorylandscapeisfastevolving,soitiscrucialforoflarge-scaledeploymentstobeakeychallengeforalsobeapproachedforlower-costhydrogensupply,organizationstoassess,evaluate,andmonitorthesehydrogenR&D.acceleratingoperationalbreakeven.Itisalsoimportantoptions.Ourresearchshowsthat64percentofE&Uthatthepriceisattractivetobuyers.ToscaleuptheorganizationsseeinadequategovernmentfundingOurresearchshowsthattheleadingE&Uplayersareindustry,differentplayersinthevaluechainmustsharetodayasakeyimpedimenttoprogressinthisspace.focusingonidentifyingthemarketandanalyzinginvestmentsaswellasleveragepublicaid.endusagepotential.AnexecutivefromaGermanSecurecustomerdemandandshareenergycompanyadds:“InordertomakelargeprojectsThereareotheruncertaintiesthatorganizationsmustinvestmentsandrisksbetweenbankable,youhavetoalignpotentialsupplywithassess,suchasnatural-gasprices,spotpowerprices,publicandprivateplayers:demand.Thatisstillachallengebecauseyouendupsufficientrenewable-powersupply,andavailableareasforwithalargeupfrontinvestment,butuncertaindemandtheproductionsite,whichcanbeexpandedfurtherbasedThelow-carbonhydrogenmarketiscurrentlyfacingaandpricing.Butwe'reidentifyingfirstcustomersandondemand,requirements,etc.Catch-22situation.Tobuilduplarge-scaleproductionstartingtocommittocertainvolumes.”facilities,producersneedguaranteedcustomerdemand.Atthesametime,tocommittoupfrontThedesignofalow-carbonprojectwillalsoneedtoinvestments,end-usersareaskingforareliablesupplyconsiderthestrengthoftheofftaker.Bycombiningoflow-carbonhydrogen.Inourresearch,68percentofmultipleofftakers,organizationscanshareE&Uorganizationsconsidertheuncertaintyofoutputsinvestmentsandrisks.SmallerlocalofftakerscanCapgeminiResearchInstitute202363Low-CarbonHydrogen:APathToAGreenerFutureFig.19Amajorityoforganizationsareevaluatingaconcurrentbusinessmodelintegratingbothtraditionalandnewlow-carbonhydrogencapabilitiesintooneEstablishgovernancemodelstosupport75%newbusinessmodels:In2020,Germany’sRWEsetupanewhydrogenbusinessunitwithinRWEGenerationSE,oneofthegroup'smaindivisions,whichholdsitsfleetofgas,hard-coal,hydro,andbiomasspowerplants.Spain'sIberdrolaSAhasalsoannouncedagreen-hydrogenbusinessunit.73...ofE&Uorganizationshavelaunchedorplantolaunchaninitiativetointegrateexistingandlow-carbon-hydrogenbusinessmodelsforconcurrentoperationSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromuniqueenergyandutilitiesorganizations.CapgeminiResearchInstitute202364Low-CarbonHydrogen:APathToAGreenerFutureEstablishhydrogen-competencecentersNextHyproject,EnelGreenPowerisdevelopingagreen-uptheworkforceinthehydrogendivisionandalargeforskills-development:hydrogencenterofexcellenceinSicily,Italy.Aswellasshareofthisworkforceisengagedinprojectdevelopment.engagingwithstartups,VCs,anduniversities,thefacilityWearefocusingondevelopingengineeringcompetenceOurpreviousresearchhighlightsthatonly38percentofwillhostwebinars,expert-leddisseminationevents,andtooperateandmaintainfutureprojectsofhydrogenE&Uorganizationssaytheyhavethenecessarydigitalandtrainingcourses.75production,understandingelectrolyzers,productionofITskillstodevelopalternativefuels(includinghydrogen).74hydrogenderivatives,etc.”Inourresearch,nearly6in10Organizationsmustfocusonexternalhiring,aswellas(58percent)ofE&Uorganizationsagreethataclean-Organizationsshouldestablishhydrogen-competenceupskillingoftalent.OneoftheGermanenergycompanieshydrogeneconomywillcreatewealthandgeneratejobcentersandimplementeducationandupskillingispromotingthetrainingandupskillingofspecialistsinopportunities.programs,aswellasmanagestakeholderexpectationshydrogen-relatedoccupationalfields.Anexecutivefromthroughcarefulstrategiccommunication.AspartofitsaGermanenergycompanyadds“WearestronglyrampingCapgeminiResearchInstitute202365Low-CarbonHydrogen:APathToAGreenerFuture87%2.Activate:Accelerateorganizationstoreducetheircapitalandoperatingcostthelow-carbonhydrogenandriskbyimprovinguptime,safety,andreliabilitywhileoftheE&Uorganizationshavealreadybeguneconomythroughmaximizingagilityandresilienceinthesupplychain.utilizingdataandanalyticsintheirhydrogentechnologyanddigitalvaluechainsengineeringHarnessthepotentialofdigital-twintechnologiestoreducecostandThomasHolm,ahydrogenresearcherfromtheInstituteoperationalrisks:forEnergyTechnology,Norway,says:“Digitaltechnologiesarecrucialtothehydrogenvaluechain–forsurveillanceofUK-basedelectrolyzermanufacturerITMPowerplanstosystems;earlydetectionoffaultsandleaks;continuouscost-buildacommercialgreen-hydrogenelectrolysisfacilityoptimization,etc.Inthedevelopmentphase,digitaltwinswith1-GWcapacityinHumberside,UK.Torealizethis,theandaccuratemodelingaregoingtogainimportance.”Asthecompanyisusingdigitaltwins.76hydrogeneconomygrows,itisvitalfororganizationstolookatdigitaltechnologiesthatextendacrossthevalueDigitaltwinscanhelporganizationsinthehydrogenvaluechain.Ourresearchindicatesthatapproximatelythreechainto:outoffour(72percent)E&Uorganizationsbelievedigitaltechnologiessuchasartificialintelligence(AI),machine•modelmultipledesignsandscenariostomaximizeROIlearning(ML),InternetofThings(IoT),anddigitaltwins(estimatesindicatethatdigital-twinanalysiscantrimwillbekeyenablerstooptimizereturnoninvestmentCAPEXby10–15percent,whilereducingriskinthe(ROI)forlow-carbonhydrogenprojects,helpinghydrogenvaluechainby30–50percent);77•monitoroperationsinrealtimetoenhanceperformanceandprofitability;•optimizepreventivemaintenancetominimizecostlyunscheduleddowntime;CapgeminiResearchInstitute202366Low-CarbonHydrogen:APathToAGreenerFuture•testcontrolsandsafetymeasures;Premtech,andDurhamUniversity(UK)todevelopdigitalOrganizationsshould:•enablepredictivepreparationfordemandandtwinstotesthydrogentransportation.78•Unifydatafromsiloedsourcesandcreateanresourcesdisruption;Ontheend-userside,Fordhasdevelopedafullyintegrateddata-managementsystem•improveemployeesafetyandfacilitatetraining;functionalprototypedemonstratortransitfuel-cell•allowdata-drivendecision-makingthroughouttheelectricvehicle(FCEV),andadigitaltwinthatisfully•Focusondata-landscapemodernizationvalidatedtocapturethekeyfunctionalfeaturesofthe•Investindata-sharingecosystemslifecycleandacrossecosystems;physicalprototype.79•Incentivizeinnovationandfostera•enhancesustainabilitybylimitingtheuseofresourcesDeveloprobustdataandtechnologydata-poweredculturealongthevaluechain.foundationstomaximizeagilityandresilienceinthesupplychain:VariousplatformprovidersareemergingtoguaranteeDigitaltwinscanstrategicallydevelopeconomictherenewableoriginofgreenhydrogen,whilealsohydrogenproductionmodelswhileofferingdecision-WithadvancedanalyticsandAI,organizationscanallowingconsumerstoquantify,record,andmonitorthemakingsupportoninvestmentrisks,financialbenefits,maximizeyields,preventenergylosses,forecastfailures,decarbonizationprocessoftheirownenergysupplyandandtheoptimalconfigurationoflow-carbonhydrogenmodeldemand,optimizestorageandtransport,reducetoverifythetransportationanddeliveryprocess.Zaneproductionsystems.costs,andde-riskinnovationandadoption.OursurveyMcDonald,ExecutiveDirectoroftheOpenHydrogenshowsthatnearly87percentofE&UorganizationsInitiative,ledbyGTIEnergysays:“AstandardizedapproachDigitalsolutionsandmodelingcanalsohelporganizationshavealreadybegunutilizingdataandanalyticsintodataanddigitalizationplaysacriticalroleinunderstandingdesignstoragespacesforhydrogenbyconsideringatheirhydrogenvaluechains;nearly60percentclaimthecarbonintensityofhydrogen.Itensuresthathydrogenrangeoffactors,suchasstationaryormobileapplication,thattheyuseAIextensivelyfortheirlow-carboninvestorsandpolicymakerscanbasedecisionsoncredibledurationofstorage,etc.Thesemodelscanhelphydrogeninitiatives.information,andthatwecanachievedeepeconomy-wideorganizationstopredictpressurechangesandfluiddecarbonizationataneconomicallyviableprice.Weaspiretomovementsduringtransportationthatdamagetanksandincreasetheutilizationofmeasureddatathatcharacterizescauseleakages.TheUK’sNationalGridhascollaboratedtheoperationalparametersofahydrogenproductionfacilitywiththeCentreforModelling&Simulation(CFMS),DNV,inreal-worldconditions.Defininghydrogen’sfacility-levelCapgeminiResearchInstitute2023carbonintensitycreatesanattributethatcanbeusedby67decisionmakerstoascribevaluetohydrogenbasedonitsLow-CarbonHydrogen:APathToAGreenerFutureenvironmentalbonafides.”Nobian,aGermany-basedchemicalscompany,ispilotingblockchainsolutionsforCapgeminiResearchInstitute2023thecertificationofgreenhydrogentoensuretraceabilityacrossthevaluechain.80EnvisionDigital,whichspecializesinthedeploymentofIoTsolutionsdedicatedtorenewableenergy,partneredwithCapgeminiEngineeringtodevelopdigitaltwinsappliedtothegreenhydrogenvaluechain.Thesetoolswillallowthecontrolandstudyoftheavailabilityandprofitabilityofthedifferentsystemsandprocessesofitsvaluechain.Moreover,theywillcertifytheoriginoftheproducedhydrogen,aswellasenableanalyticalsolutionstocharacterizetheperformance,reliability,andcostofthevarioussystems.81"...Weaspiretoincreasetheutilization68ofmeasureddatathatcharacterizestheLow-CarbonHydrogen:APathToAGreenerFutureoperationalparametersofahydrogenproductionfacilityinreal-worldconditions.ZaneMcDonaldDefininghydrogen’sfacility-levelcarbonintensitycreatesanattributethatcanbeusedExecutiveDirectorofbydecisionmakerstoascribevaluetohydrogentheOpenHydrogenbasedonitsenvironmentalbonafides."Initiative,ledbyGTIEnergyCapgeminiResearchInstitute202369Low-CarbonHydrogen:APathToAGreenerFuture3.Collaborate:PartnertoPartnershipscanalsoencourageco-ordinationbetweenscalelow-carbonhydrogeninvestors,policymakers,andotherstakeholderstotechnologyshapethemarketanditsregulatoryframework.Theorganizationsthatcanidentify,negotiate,andstructureGiventheuncertaineconomicenvironmentandhugepartnershipsmosteffectivelywillhaveacompetitivecapitalrequirementtobuildthelow-carbonhydrogenadvantageinthelow-carbon-hydrogeneconomy.valuechain,partnershipscouldenableE&Uorganizationstosharerisksandcosts,aswellasthecapabilitiesClearlyarticulatepartnershipstrategythatarecriticaltoscaling.Partnershipswillalsoallowandmakethoughtfultrade-offs:companiestosetupexploratoryprojectsacrossdifferentgeographies,technologies,andusecases,raisingtheFirstly,organizationsmustfindanswerstokeyquestions,probabilityoffindingamarket-winningsolution.suchaswithwhomtopartnerinthevaluechain,andwhyandhowtocollaboratewithclients,peers,andotherplayerstogeneratescalebenefits,manageconversion,enhancethestorageanddistributionofCapgeminiResearchInstitute202370Low-CarbonHydrogen:APathToAGreenerFutureFig.20TherightpartnerecosystemcouldhelpE&Uorganizationsscalelow-carbonhydrogentechnologyhydrogen,build/repurposeexistinginfrastructure,PartneringwithprimaryenergyPartneringwithhydrogeninfrastructureandaggregatedemand.Thesecouldbejoinedbyproducers/playersproviderstechnologyproviders,offeringtherequirednicheSecureaﬀordablerenewable/nuclearenergyRepurposeexistinginfrastructureorbuildaengineering,technical,anddigitalexpertise.Wefoundatscalenewoneatlowercostthat44percentoftheE&Uorganizationswesurveyedhighlightedintegratedsupplystructureand45percentPartneringwithequipmentPartneringwithendusershighlightedestablishingcollaborationacrossthevalue(electrolyzer)suppliersHydrogenproductiononcustomersitetochainaskeysuccessfactorsforlarge-scalehydrogenLowerproductioncoststhroughscalinglowertransportationcostandaggregateprojects.Organizationsmustclearlyidentifythe“whitedemandspaces”intheirlow-carbon-hydrogenstrategies(seePartneringwithhydrogen-storage-systemFigure20).developersPartneringacrossthevaluechainConverthydrogentovariousderivatesforEnd-to-endcollaborationtopromoteeﬃcientstorageandlong-distancetransportcross-industrycoordinationSource:CapgeminiResearchInstituteanalysisCapgeminiResearchInstitute202371Low-CarbonHydrogen:APathToAGreenerFutureFig.21E&UorganizationsarecombiningtheircapabilitiesAccordingtooursurvey,amajorityofE&Uorganizations%OFE&UORGANIZATIONSTHATHAVEALREADYACQUIREDORPLANTOACQUIREarepartneringtosharevariouscapabilitiesacrosstheTHEFOLLOWINGCAPABILITIESvaluechain(seeFigure21).60%61%50%50%50%organizationsbelievenewallianceswillformtodevelophydrogenprojectsthroughcross-40%40%38%sectorcollaborations30%30%29%25%14%ElectrolyzerElectrolyzerOﬀshorehydrogenHydrogenenergyHydrogenprocesserHydrogenmanufacturertechnologyproduction-facilityinfrastructureplatformproviderstorage-system(compress/providers(dispenseoperator/pipes/development)developersseparate/monitor(aircompression/catalyze/purify)/liquidation/hydrogencarriers/solids)AlreadyintegratedthesecapabilitiesPlantointegrateinthenext1–3yearsSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=33respondentsfromuniqueE&Uorganizationsinvestingacrossallareasofthevaluechain.CapgeminiResearchInstitute202372Low-CarbonHydrogen:APathToAGreenerFuturePartneringwithprimaryenergyPartneringwithequipment(electrolyzer)assessopportunitiesfromtechnical,commercial,andproducers/players:suppliersandprocessdevelopers:safetyperspectives83•ChinaPetrochemicalCorporation(SinopecGroup)andWefoundthat63percentofE&UorganizationsweElectrolyzercostsarethegreatestcontributortotheCumminsInc.haveformeda50:50jointventuretosurveyedhaveenergypartnershipswithsolar-/wind-overallTCOoflow-carbonhydrogen.E&Uorganizationsproducegreen-hydrogentechnologies;CumminswillenergyproducerstosecureelectricsupplytoproducecouldsecureaccesstotheequipmentthroughoneoftheinitiallyinvestRMB300million($47million)inPEMlow-carbonhydrogen.Forexample,BPandSpanishclean-followingapproaches:electrolyzers84energycompanyIberdrolaformedajointventure(JV)forlarge-scalegreen-hydrogenproductioninSpain,Portugal,–formpreferred-supplierallianceswithPartneringwithhydrogenstorageandtheUK.82electrolyzerprovidersandinfluencesystemdevelopers:technical-designspecificationsAsanintermediatestepbeforecommittingtoaspecificUnusedlow-carbonhydrogenmustbestored,atproject,E&Uorganizationscouldalsoexplore:–partnerwithengineering,procurement,andadditionalcost.E&Uorganizationshaveestablished/areconstruction(EPC)partnerstostandardizeascalableplanningtoestablishpartnershipswithhydrogenstorage-–commercialarrangementswithrenewable/nuclear-approachtoplantdesignsystemdevelopersfortheirspecifictechnicalexpertise.energyprovidersforlockinginvolumesandpricingAlternatively,low-carbonhydrogenproducerscanexploreunderapreferredpartnershipagreement(PPA)or–takeequitystakesintheequipmentsupplychainpathwayssuchas:purchaseagreementwithathird-partyofftaker;orofferastaketoanelectrolyzermanufacturerinproductionvolumestosharecapitalrisk–securingapartnershiptoconverthydrogentoother–formingJVstodevelop,operate,andmaintainforms,suchasmethylcyclohexane(MCH),makingitintegratedprimaryenergyandproductionfacilities;Severalorganizationsareexploringthisroutetoreducingeasiertostoreandtransportoverlongdistances;theoverallproductioncost:–joint-developmentagreementswithgreen-energy–expansionofoperationstobecomeagreen-companiestoco-developproductionfacilitiesand•ShellIndiaandOhmiumInternational,agreen-ammoniaproducer,tappingintotheexistingprovidegreenenergyatadvantageousprices.hydrogencompanythatdesigns,manufactures,anddeploysPEMelectrolyzers,arecollaboratingtoCapgeminiResearchInstitute202373Low-CarbonHydrogen:APathToAGreenerFutureammoniasupplychain;anexampleisAirProducts,Partneringwithhydrogeninfrastructurebusinesses.ASwedishsteelmaker,SSAB,hasenteredaACWAPower,andNEOM,whoarepartneringproviders:JVwithpowerutilityVattenfallandmininggroupLKABona$5billiongreen-hydrogen-basedammonia-todevelopgreenhydrogentopowertheHybritsteelproductionfacilitypoweredbyrenewableenergyE&UorganizationsarepartneringtostimulateplantinLulea,Sweden.86AndVolvoCarswillbethefirsttosupply650tonsofgreenhydrogenperdayfordevelopmentoftransportationinfrastructureforlow-carmakertosecureSSABsteelmadefromhydrogen-globaltransportation.85carbonhydrogen.E&UorganizationsarealsosharingreducedironfromtheHYBRITpilotplantinLuleå,theriskandcostassociatedwithdevelopingnewSweden.87Belgium-basednatural-gastransmissionsystemoperatorpipelines/infrastructurebymakingthempartnersintheirFluxysisdevelopingrenewablehydrogenimportfacilitiesproductionplants.Inourresearch,69percentofend-userorganizationsandhaspartneredwithAdvario,aliquidstoragelogisticslisthydrogen-supplysecurity(broadavailabilityofplayer,toinvest,build,andoperatethesefacilities.Partneringwithendusers:greenhydrogenonanindustrialscale)asakeysuccessCédricVanHoonackerfromFluxyscomments,“Thereisfactorinlarge-scalehydrogenprojects.Halfoftheanecessityoftheimportfacilities,withtheroletoimportLow-carbonhydrogenproducersarealsopartneringend-userorganizationswesurveyedexpecttosignrenewablehydrogenfromcontinentswithmoresunandbroadlywithpotentialenduserstostimulatemarketlong-termlow-carbonhydrogensupplycontractswithwind.WeneedtheimportfacilitieswithinBelgiumasdemandandde-riskprojects.ThisrangesfromE&Uorganizationspriortocommercialdeployment.well.There,wepartneredupwithAdvariointheharborjointresearchanddevelopmenttobroadersectorofAntwerptobuildandoperate,andtoinvestinimportcollaborations.facilitiestogether.So,wehavepartnershipsforsomeprojects,forinstance,anammoniaimportfacility,ammoniaEnd-userindustriessuchassteel,cement,mining,andstorage,ammoniahandling,andammoniacrackingtowardsfertilizersarelookingforguaranteedaccesstolow-hydrogen,withconnectiontoourgrid.”carbonhydrogenandarewillingtotakeequitystakesinco-locatedprojectsthatexclusivelybenefittheirCapgeminiResearchInstitute2023“….WepartneredupwithAdvariointhe74harborofAntwerptobuildandoperate,Low-CarbonHydrogen:APathToAGreenerFutureandtoinvestinimportfacilitiestogether.So,wehavepartnershipsforsomeprojects,CédricVanHoonackerforinstance,anammoniaimportfacility,ammoniastorage,ammoniahandling,andKeyAccountManagerforammoniacrackingtowardshydrogen,withNextgridH2&CO2atFluxysconnectiontoourgrid.”CapgeminiResearchInstitute202375Low-CarbonHydrogen:APathToAGreenerFuturePartneringacrossthevaluechain:DevelopingyourownecosystemOnscaling,Pierre-EtienneFranc,CEOofHy24,ajointventurebetweenassetmanagersArdianSASandFiveTE&Uorganizationsarealsoformingend-to-endLargeindustrialplayersandgovernmentscouldalsoHydrogen,says:"Youcan'tmovefrom10-MWsizetocollaborations.Multipleregionalgreen-hydrogenexploreotherpathwayssuchasdevelopingtheirowngigawattsizejustlikethat.First,itisnecessarytobuildhubsareemergingtominimizeinfrastructurecostsbyecosystemspanningacrossthevaluechaintoincludefacilities10timesthesizeofpilotprojectscurrentlyoperatingconsolidatingrenewable-energygeneration,green-ownfunding,buildingandmanagingplantoperations,inEurope.Thosewillprovidetheoperationalknowledgeandhydrogenproduction,andofftakeatcommercialscale.storage,marketinganddistributionofmoleculesaswelltheelectrolyzer-manufacturingcapacitynecessarytoscaleManyofthesehubsalsocollaboratewithlocal,regional,asdevelopinginfrastructurethatservesownersdirectlyuptothenextlevel.”88E&Uorganizationslookatscalingandnationalgovernmentstopromotecross-industryplusthirdpartiesonatollingbasis.Thiswouldenableasacriticalleverforlow-carbonhydrogencostreduction.coordination,cuttingthroughredtapeandtappingintolargeplayerstoachievescalebenefitswithcompetitiveOursurveyfoundthatalmosttwo-thirds(60percent)governmentsubsidies.CompanieslikePlugPowerandadvantage.oforganizationssurveyedbelievethatlarge-scaleCumminsarebuildingaglobalecosystemofpartnershipsproductionisvitaltocostreduction.withpeerstoimproveR&D,createscalablesolutions,andWithgrowingdemandforcleanerenergysources,E&Uconsolidateactivities,andwiththeircustomerstolockorganizationsmustscaletheirlow-carbonhydrogenindemand,includingthroughselectiveequitystakesininitiativeswithsomeurgencytomakeameaningfulhydrogenproductionprojects.impactonthetotalenergymix.Thiscanalsoleadtofurtherproduction-costreduction,acleaneroverallCross-industrypartnershipswouldalsoenableE&Uenergyprofile,andpreferred-partnerstatuswithlargeorganizationstolockinguaranteedofftakeforgreen-end-userorganizationslookingtoreducetheircarbonhydrogenproduction,reducingtheriskinvolvedinprofiles–specificallyscope-1emissions.capitalinvestment.Wealsofoundthat61percentofE&Uorganizationswesurveyedbelievehydrogenprojectswillarisethroughnewcross-sectorcollaborations;55percentofend-userorganizationsbelievethesame.CapgeminiResearchInstitute202376Low-CarbonHydrogen:APathToAGreenerFutureConclusionLow-carbonhydrogenisemergingasoneofthepromisingRegulatoryrequirements,commercialchallenges,engineeringtoolsforemissionsreductionandisrecognizedgloballybybarriers,aswellassafetyandskillhurdlesareyettobetackled.governmentsandbusinessorganizationsasacrucialfacilitatorinachievingagreenerfuture.AlthoughthepotentialvariesGovernmentshavebeenworkingtofillpolicygapsandprovideacrosssectorsandregions,theshareofrenewableandnuclear-confidencetoinvestorsandstakeholders.Organizationsneedproducedhydrogenintotalhydrogenproducedisexpectedtotoidentifythesynergiesacrossthevaluechaintoovercomethegrowexponentially.barriers.Thecomplexityassociatedwithdevelopingindustrial-scalelow-carbonhydrogenprojectscanbemanagedby:Organizationsareworkingtowardsstrengtheningthelow-carbonhydrogensupplychainbyinvestingacrossthe•evaluatingnewbusinessmodelsfromsustainabilityandtotalvaluechain.Countriesgloballyarepromotinglow-carboncostofownershipstandpointsandsecuringdemandhydrogenadoptionandaresettingupambitioustargets.End-usersinhard-to-abatesectorsarealsokeentoexplorethe•leveragingtechnologiessuchasdigitaltwins,AI,anddecarbonizationpotentialoflow-carbonhydrogen.analyticstosolveengineeringandcostchallengesDespitethebroadsupportandstrongprojectpipeline,•identifyingsynergiesandcollaborationopportunitiesacrosssizeablebarriersexistinturningambitiousvisionsintoreality.thevaluechain.CapgeminiResearchInstitute202377Low-CarbonHydrogen:APathToAGreenerFutureAppendixHydrogen-productionDescriptionTypeofhydrogentechnologiesproducedcurrentlyavailableTheprocessconvertsorganicorfossil-basedcarbonaceousBlack/brownhydrogenGasificationmaterialsintoCO,H2,andCO2.GrayhydrogenBluehydrogenSteammethanereforming(SMR)Inthisprocess,methanereactswithsteamunder3–25barpressureinthepresenceofacatalysttoproducehydrogen,SMRwithcarboncapture,CO,andarelativelysmallamountofCO2.utilization,andstorage(CCUS)Inthisprocess,CO2iscaptured(85–90percent)atthePyrolysisproductionfacilityandstoredseparately(i.e.,notreleasedintotheenvironment).Renewable-energyelectrolysisThethermaldecompositionofmethaneisknownasmethaneTurquoisehydrogenNuclear-energyelectrolysispyrolysisandproducessolidcarbonasaby-product.HydrogengeneratedthroughelectrolysisofwaterpoweredGreenhydrogenbyrenewableenergysuchassolar/windpower.Hydrogenproducedfromelectrolysisofwater,usingPinkhydrogennuclearenergy.CapgeminiResearchInstitute202378Low-CarbonHydrogen:APathToAGreenerFutureTypeofelectrolyzersDescriptionAlkalineelectrolyzersAlkalineelectrolysismakesuseoftwoelectrodessubmergedinanalkalineelectrolytesolution(suchaspotassiumorsodiumhydroxide);anon-conductiveporousmembranecalledadiaphragmPEM(proton-exchangeisusedtoseparatetheO2andH2fromwater.membrane)electrolyzersPEMelectrolyzersuseasolidpolymermembranethatabsorbspositivelychargedhydrogenatoms(separatedfromoxygenusingelectricity)andallowsthemtoflowintoaseparatetank,whereAEM(anion-exchangetheyre-bondintoH2molecules.membrane)electrolyzersHydrogenproductionusingwaterelectrolyzersequippedwithanAEM.SOEC(solid-oxideelectrolyzercell)electrolyzersAnSOECisasolid-oxidefuelcellthatrunsinregenerativemodetoachievetheelectrolysisofwaterbyusingasolid-oxide,orceramic,electrolytetoproduceH2andO2.CapgeminiResearchInstitute202379Low-CarbonHydrogen:APathToAGreenerFutureTermsusedinthereport:•Hydrocracking:Processbywhichthehydrocarbonmoleculesofpetroleumarebrokenintosimpler•Powertogastopowertechnology:Processofmolecules(gasolineorkerosene)bytheadditionofproducinghydrogen(throughelectrolysisusinghydrogenunderhighpressureandinthepresenceofelectricity)andthenstoringittobeusedtoacatalyst.generateelectricity.•Hydrotreating:Processofremovingcontaminants•DRI:Directreducedironistheproductofthedirectsuchassulfur,nitrogen,andmetalsfromreductionofironoreinthesolidstatebycarboncrude-oilfractions.monoxideandhydrogen.•Levelizedcostofelectricity(LCOE):Accordingtothe•Hydrogenplasmasmeltingreduction:TheprocessofUSEnergyInformationAdministration(EIA),LCOEusinghydrogenthermalplasmatoreduceironoxides.“representstheaveragerevenueperunitofelectricitygeneratedthatwouldberequiredtocoverthecostsofbuildingandoperatingageneratingplantduringanassumedfinanciallifeanddutycycle.”CapgeminiResearchInstitute202380Low-CarbonHydrogen:APathToAGreenerFutureResearchTounderstandthegrowingprominenceoflow-carbonExecutivesurveymethodologyhydrogenfrombothorganizationalandregulatory/policyperspectives,alongwithevolvingbusinessmodelsandWesurveyedatotalof860respondentsfromuniquethecurrentmaturityoforganizations,wecarriedoutorganizationsacross13countries,ofwhich:extensivequalitativeandquantitativeresearch.•500werefromuniqueE&Ufirmsworkingonlow-In-depthinterviewscarbon-hydrogeninitiativeswithmorethan$500millioninannualrevenueWeconducted21in-depthinterviewswithindustryexecutivesfromvariousorganizations,includingsenior•360werefromend-usersectors,includingexecutivesfromenergyandutilities(E&U)firmsandend-petroleum,steel,chemicalsandfertilizers,heavy-userorganizations(petroleum,steel,chemicals,heavy-dutytransportation(includingcoaches/heavytrucks),dutytransportation,maritime,aviation,etc.),aviation,andmaritimetransportation,withmorethanpolicymakers,techstartups,academics,economists,etc.$1billioninannualrevenueIntervieweesareinvolvedintheplanningandTherespondentswereatdirectorleveloraboveanddevelopmentoflow-carbon-hydrogeninitiativesandwereresponsibleforeitherplanningorimplementingworkacrossfunctionalareassuchasstrategy,product/low-carbon-hydrogenprojects/initiativesintheirservicedevelopment,innovationandengineering,organizationsorbeingcloselyassociatedwiththem.operations(supplychain–procurement,transportation,Thedistributionofrespondentsandtheirorganizationsetc./production),businessunitsspecificallydealingwithisprovidedinthefollowingfigures.Thestudyfindingshydrogen,renewables,newenergies,decarbonization,reflecttheviewsofrespondentstoouronlinetheenvironment,sustainability,energytransition,endquestionnaireforthisresearchandareaimedatprovidingusage(hydrogenusedforfuelcells/engines),etc.directionalguidance.PleasecontactoneoftheCapgeminiexpertslistedattheendofthereporttounderstandspecificimplications.CapgeminiResearchInstitute2023%OFRESPONDENTSBY%OFRESPONDENTSBY81ORGANIZATIONHEADQUARTERSORGANIZATIONHEADQUARTERSLow-CarbonHydrogen:APathToAGreenerFuture(E&UORGANIZATIONS)(END-USERORGANIZATIONS)CapgeminiResearchInstitute2023NorwaySwedenSpainNorwayNetherlandsUSSwedenUSItaly3%3%2%14%5%3%2%Netherlands17%4%5%ItalySpain4%5%Australia7%14%UK6%14%FranceUK8%8%FranceAustralia8%14%8%10%8%IndiaGermanyCanada9%GermanyIndiaJapan9%9%JapanCanadaSource:CapgeminiResearchInstitute,low-carbonhydrogenSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromsurvey,November–December2022,N=360respondentsfromuniqueenergyandutilitiesorganizations.uniqueend-userorganizations.%OFRESPONDENTSBYORGANIZATION%OFRESPONDENTSBYORGANIZATION82REVENUE(E&UORGANIZATIONS)REVENUE(END-USERORGANIZATIONS)Low-CarbonHydrogen:APathToAGreenerFuture>$50B$500M–$999M>$50BCapgeminiResearchInstitute20237%$20B–$49.99B7%7%$20B–$49.99B9%9%$10B–$10B–11%$19.99B13%$19.99B15%49%13%61%$5B–$9.99B$1B–$4.99B$5B–$9.99B$1B–$4.99BSource:CapgeminiResearchInstitute,low-carbonhydrogenSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromsurvey,November–December2022;N=360respondentsfromuniqueenergyandutilitiesorganizationsuniqueend-userorganizations83Low-CarbonHydrogen:APathToAGreenerFuture%OFRESPONDENTSBYORGANIZATIONINDUSTRY(E&UORGANIZATIONS)WaterutilitiesGasutilities(transmission,Energyservice19%distribution)7%7%Multi-utilities16%Utilities(50%)12%OilandgasEnergy(50%)extraction9%21%6%Reﬁning,marketing,and4%distribution(includingretail)Electricutilities(generation,transportation,Integratedoilandgasdistribution,energysupply)AlternativeenergySource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromuniqueenergyandutilitiesorganizationsCapgeminiResearchInstitute202384Low-CarbonHydrogen:APathToAGreenerFuture%OFRESPONDENTSBYORGANIZATIONINDUSTRY(END-USERORGANIZATIONS)MaritimeSteel14%20%Petroleum(reﬁning)15%20%Chemicals&fertilizers15%16%Heavy-dutytransportationAviation(includingcoaches/heavytrucks/trains)Source:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=360respondentsfromuniqueend-userorganizations.CapgeminiResearchInstitute2023%OFRESPONDENTSBYDEPARTMENT%OFRESPONDENTSBYDEPARTMENT85/FUNCTION(E&UORGANIZATIONS)/FUNCTION(END-USERORGANIZATIONS)Low-CarbonHydrogen:APathToAGreenerFutureAcceleratorsprograms1%Public&regulatoryaﬀairsGeneralmanagement/businessmanagementCapgeminiResearchInstitute2023Environment/Sustainability/strategyandcorporatefunctionsGeneralmanagement/businessmanagement/strategyandcorporate10%Sustainability2%functionsbusinessunitEngineering/R&DInnovation4%3%Energytransition18%10%9%30%33%Renewable4%Engineering13%4%Power/R&D3%generation14%3%DecarbonizationNewenergies24%InnovationHydrogen22%1%IndustryapplicationbusinessunitOperations(supply26%Operationschain,procurement,(supplychain,production,etc.)procurement,production,etc.)Source:CapgeminiResearchInstitute,low-carbonhydrogenSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromsurvey,November–December2022;N=360respondentsfromuniqueenergyandutilitiesorganizationsuniqueend-userorganizations.86Low-CarbonHydrogen:APathToAGreenerFuture%OFRESPONDENTSBYDESIGNANTION%OFRESPONDENTSBYDESIGNANTION(E&UORGANIZATIONS)(END-USERORGANIZATIONS)SeniorDirector31%SeniorDirector33%23%AssociateVicePresident26%Director21%/VicePresident24%AVP/VP15%Director14%SVP/EVPDivisionalHeads3%ExecutiveVicePresident/SeniorVicePresidentChiefSustainabilityOﬃcer2%DivisionalHead3%ChiefStrategyOﬃcer1%ChiefStrategyOﬃcer1%ChiefInnovationOﬃcer1%ChiefInnovationOﬃcer1%ChiefProductOﬃcer1%Source:CapgeminiResearchInstitute,low-carbonhydrogenSource:CapgeminiResearchInstitute,low-carbonhydrogensurvey,November–December2022;N=500respondentsfromsurvey,November–December2022;N=360respondentsfromuniqueenergyandutilitiesorganizationsuniqueend-userorganizationsCapgeminiResearchInstitute202387Low-CarbonHydrogen:APathToAGreenerFutureReferences1.IEA,“Thefutureofhydrogen:Seizingtoday’s10.IRENA,“Energytransitiontechnology:Hydrogen,”accessed21.DAF,“Hydrogenaninterestingoptionforthefuture,”2023.opportunities,”June2019.February3,2023.22.Volvo,“VolvoTrucksshowcasesnewzero-emissionstruck,”2.IRENA,“Makinggreenhydrogenacost-competitiveclimate11.IRENA,“Worldenergytransitionoutlook2022,1.50June2022.solution,”December2020.pathway,”May202223.BBC,“Theracetomakedieselenginesrunonhydrogen,”3.Note:Selectedend-usersectorsincludedinthesurvey12.IEA,Hydrogentrackingreport,September2022.January2023.basedonhydrogenusagepotential.13.S&PGlobal,“USdevelopersstandbybluehydrogenas24.ManEnergySolutions,“Designingtheenginesofthe4.USEnergyInformationAdministration,“Hydrogensomequestionitscompetitiveness”,August2022future,”2023.explained,”January2022.14.ExxonMobil,“ExxonMobilplanninghydrogenproduction,25.Airbus,“Airbusrevealshydrogen-poweredzero-emission5.EuropeanCommission,“CommissionsetsoutrulesforcarboncaptureandstorageatBaytowncomplex,”engine,”November2022.renewablehydrogen,”February2023;Euractiv,“EUMarch2022.26.Rolls-Royce,“Rolls-RoyceandeasyJetsetnewworldfirst,”Parliamentbackspro-nucleardefinitionof‘low-carbon’15.BusinessWire,“AirLiquide,Chevron,LyondellBasell,andhydrogen,”February2023.UnipertoPursueLowerCarbonHydrogenandAmmoniaNovember2022.ProjectAlongtheU.S.GulfCoast,”October2022.27.OffshoreEnergy,“GlobalData:Hydrogenmarkettowitness6.IEA,“NorthwestEuropeanHydrogenMonitor,”accessed16.WorldEconomicForum,“Grey,blue,green–whyarethereMarch15,2023.somanycoloursofhydrogen?”July2021.growthsurgein2023,”February2023.17.IEA,Hydrogentrackingreport,September2022.28.ENGIE,“ENGIEhasreachedanimportantmilestonein7.DepartmentofEnergy,“U.S.DepartmentofEnergyClean18.ExxonMobil,“ConstructionbeginsonnewhydrocrackeratHydrogenProductionStandard(CHPS)draftguidance,”Rotterdamrefinery,”June2016.theAustralianrenewablehydrogenprojectwithYara,”accessedMarch15,2023.19.OffshoreEnergy,“YarajoinsHyPilotprojecttotestuseofSeptember2022.hydrogeningreenammoniaproduction,”September2022.29.EDFEnergy,“HydrogenandSizewellC,”accessed29th8.HydrogenEurope,CleanHydrogenMonitor,2022,20.ArcelorMittal,“ArcelorMittalsuccessfullytestspartialMarch2023.October2022.replacementofnaturalgaswithgreenhydrogentoproduce30.PVMagazine,“IberdrolaandIngeteamsetupJVtoproduceDRI,”May2022.electrolyzersinSpain,”November2020.9.SoCalGas,“GKNHydrogen,SoCalGas,andtheNational31.PowerTechnologyResearch,“Hightechstart-upHysataRenewableEnergyLaboratorycollaborateonnewsecuresA$42.5millionfundingtoproduceworld’sch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nDecember2021.under12months,”November2021.87.SSAB,“VolvoCarsisfirstcarmakertoexplorefossil-freesteelwithSSAB,”June2021.72.Rullion,“Developingtheskillsforhydrogenstartsnow,”80.Nobian,“BlockchainsolutionpilotforcertificationofgreenDecember2022.vhydrogen,”January2023.88.BusinessStandard,“Oilfirmsbetongreenhydrogenasfutureofenergy;plantoinvestbillion,”June20,2022.CapgeminiResearchInstitute202390Low-CarbonHydrogen:APathToAGreenerFutureCAPGEMINIPROVIDESENDTOENDASSISTANCETOHYDROGENPLAYERS–FROMHYDROGENSTRATEGYTOINDUSTRIALANDOPERATIONALPROJECTDEPLOYMENTSTRATEGYDESIGN,PRODUCTOPERATIONS&INNOVATION&CONSTRUCTION&MAINTENANCEPositioningMarketwatchGrowthstrategyDesign&IntegrationH2TrainingAssetmanagementOperations&engineering&SafetyMaintenanceoptimization&SafetyRoadmapResearchFundingManufacturing,&Innovation&ContractsSupplychain&ConstructionCROSS-FUNCTIONALLEVERSMonitoringofPMODIGITALfundingprojectsTRANSFORMATIONORGANIZATION&GOVERNANCEBusinessUnitEcosystemIT/OTDigitalDatavalorizationLifecyleStructuringmanagementInfrastructureTransformationCapgeminiResearchInstitute202391Low-CarbonHydrogen:APathToAGreenerFutureSELECTIONOFCREDENTIALS•Hydrogenmanagementsystemdigitaltwintoproduce•Leadingelectrolyzermanufacturer:design&decarbonatedcarbonproductionprocessoptimization•THySO(ToolforHydrogenSystemOptimization)—digitaltooltooptimizeH2systems•Engineeringsupportforhydrogenporopulsion•ImplementationofAlforoptimizingsupply,quality,systems(H2Cell)developmentandmanufacturing•ImproveservicereliabilityoffuelcellstacksinH2fleet•SISTERproject—designofhydrogenstorageofbusequipmentbasedonamulti-criteriaapproach(performance,costandsecurity)•SafetyanalysisforH2facilitiesinaleadingoil&gasrefinery•Hypropeproject—designofaflexgasturbine(heavymobility)•Safetycaseofhydrogenfuelstationsforaleading•CALLISTOproject—H2specificationsforthesupply,worldutilitystorageanddistribution•SafetycasePower-to-Greenhydrogenrenewable•EPCandpre-PMforaliquidhydrogenproductionplant•FuelCellOEM:PredictivemaintenanceonhydrogenhydrogentofeedapilotH2ecosystemusingasdirectenergyonurbanmobilityandinjectedintothenaturalbusfleetgasgridCapgeminiResearchInstitute202392Low-CarbonHydrogen:APathToAGreenerFutureKeycontributorsFlorentAndrillonPeterKingPhilippeVieVP,EUCCountryLead,HeadofVPGlobalEnergyandUtilitiesVP,GroupGlobalLeadEnergy,JamesForrestClimate,Energy&UtilitiesMarketLead,CapgeminiInventUtilitiesandChemicals,EVP,GlobalandUKLeadUnit,CapgeminiInventpeter.king@capgemini.comCapgeminiEnergy,UtilitiesandChemicals,florent.andrillon@capgemini.comphilippe.vie@capgemini.comCapgeminiBenoitCatalyudjames.forrest@capgemini.comRichardBiagioniDirectorEnergyTransition,AlainChardonVPClimate,Sustainability&CapgeminiInventDirectorEnergyTransition,CorinneTresyJouannyEcosystems,CapgeminiInventbenoit.calatayud@capgemini.comCapgeminiInventEVP,HeadofPortfolioandrichard.biagioni@capgemini.comalain.chardon@capgemini.comIndustryCentersofExcellence,SubrahmanyamKVJCapgeminiEngineeringJeromeBuvatSeniorDirector,CapgeminiNancyManchandacorinne.jouanny@capgemini.comHeadofCapgeminiResearchResearchInstituteProgramManager,CapgeminiInstitutesubrahmanyam.kvj@capgemini.comResearchInstituteMarkViehmanjerome.buvat@capgemini.comnancy.manchanda@capgemini.comPrincipal,HydrogenandCleanFuels,Capgeminimark.viehman@capgemini.comHarshadaSambareSeniorConsultant,CapgeminiResearchInstituteharshada.suresh-sambare@capgemini.comCapgeminiResearchInstitute202393Low-CarbonHydrogen:APathToAGreenerFutureTheauthorswouldalsoliketothankKeithWilliams,AbouttheCapgeminiResearchInstituteAbdelmalekMalouche,JeanLucChabaudie,PieterDeCocker,BragadeshDamodaran,DivyeshArora,JeremyTheCapgeminiResearchInstituteisCapgemini’sin-houseCure,AlanJean-Marie,JamesRobey,LaurentBromet,thinktankonallthingsdigital.TheInstitutepublishesAlexandreSmars,KieranReynolds,PierreYvesLeMorvan,researchontheimpactofdigitaltechnologiesonlargeArianTurhani,JosephWelford,MarkusWinkler,Juliantraditionalbusinesses.TheteamdrawsontheworldwideFowler,DavidPerezLopez,Nicolas-JosefRuzek,RaphaëlnetworkofCapgeminiexpertsandworkscloselywithCasteau,RobPears,FrédéricArquier,SubrataRay,Joyceacademicandtechnologypartners.TheInstitutehasChew,HinrichThölken,KatharinaBessler,EduardoJavierdedicatedresearchcentersinIndia,Singapore,theUK,andCarreraGuilarte,ColetteTalbot,LucyColling,YashwardhantheUS.ItwasrecentlyrankednumberoneintheworldbyKhemka,ShubhangiMahendraShinde,NikhilSingh,Kristinindependentanalystsforthequalityofitsresearch.EMorris,JaydeepNeogi,andRupaliChakrabortyfortheircontributiontothisresearch.Visitusatwww.capgemini.com/researchinstitute/Formoreinformation,pleasecontact:JamesForrestMikeLewisPeterKingLaurentBrometRichardBiagioniEVP,GlobalandUKLeadEnergy,VP,GlobalLeaderEnergyVPGlobalEnergyandUtilitiesLead,VP,GlobalHeadofEnergy&VPClimate,Sustainability&Ecosystems,UtilitiesandChemicals,CapgeminiTransition,CapgeminiCapgeminiInventUtilities,CapgeminiEngineeringCapgeminiInventjames.forrest@capgemini.commike.lewis@capgemini.competer.king@capgemini.comlaurent.bromet@capgemini.comrichard.biagioni@capgemini.comCapgeminiResearchInstitute202394Low-CarbonHydrogen:APathToAGreenerFutureDiscovermoreaboutourresearchSUSTAINABILITYTRENDSDATAFORNETZEROSUSTAINABILITYINDIGITALTWINS:ADDINGConnectingAUTOMOTIVEINTELLIGENCETOTHEREALthedotsDatasharinginthepublicsectorWORLD#GetTheFutureYouWantDATAECOSYSTEMSINPUBLICSECTORREMODELINGTHEDATAMASTERYSUSTAINABLECONVERSATIONSFUTURE:HOWOPERATIONS–AFORTOMORROWCOMPREHENSIVEENERGYTRANSITION–INTELLIGENTISDRIVINGNEWGUIDEFORINDUSTRYMANUFACTURERSMODELSINENERGYANDUTILITIESCapgeminiResearchInstitute202395Low-CarbonHydrogen:APathToAGreenerFutureSubscribetolatestresearchfromReceivecopiesofourreportsbyscanningtheQRcodeorvisitingCapgeminiResearchInstitutehttps://www.capgemini.com/insights/research-institute/subscribe/CapgeminiResearchInstituteFieldsmarkedwithanarerequiredFirstNameLastNameEmailBysubmittingthisform,IunderstandthatmydatawillbeprocessedbyCapgeminiasindicatedaboveanddescribedintheTermsofuse.SubmitCapgeminiResearchInstitute2023AboutCapgeminiCapgeminiisagloballeaderinpartneringwithcompaniestotransformandmanagetheirbusinessbyharnessingthepoweroftechnology.TheGroupisguidedeverydaybyitspurposeofunleashinghumanenergythroughtechnologyforaninclusiveandsustainablefuture.Itisaresponsibleanddiverseorganizationof360,000teammembersinmorethan50countries.Withitsstrong55-yearheritageanddeepindustryexpertise,Capgeminiistrustedbyitsclientstoaddresstheentirebreadthoftheirbusinessneeds,fromstrategyanddesigntooperations,fueledbythefastevolvingandinnovativeworldofcloud,data,AI,connectivity,software,digitalengineeringandplatforms.TheGroupreportedin2022globalrevenuesof€22billion.GettheFutureYouWantwww.capgemini.comCopyright©2023Capgemini.Allrightsreserved.

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