Experts recommend focusing limited green hydrogen supplies on industries like steel-making and ammonia production to maximize carbon emission reductions. A study analyzing 2000 global projects highlights these sectors as offering the greatest climate benefits, while uses in road transport and heating provide lesser impacts. With production forecasts low, strategic allocation is crucial for net-zero goals.
Hydrogen holds promise as a clean energy carrier, producing only water when combined with oxygen, yet current supplies are predominantly grey hydrogen derived from fossil fuels, accounting for 99 percent of production and emitting significant CO2. To achieve net-zero emissions, shifts toward blue hydrogen, which captures CO2, or green hydrogen, made via renewable electrolysis of water, are essential. However, green hydrogen costs at least twice as much as grey varieties, prompting BloombergNEF to cut its 2030 low-carbon production forecast to 5.5 million tonnes—about 5 percent of today's grey consumption.
United Nations chief Antonio Guterres emphasized on 3 December that green hydrogen represents "an important bet" for Western countries to rival China in clean technologies. Amid subsidies and policy challenges, such as US cancellations of hydrogen hubs under a $7 billion program, researchers stress prioritization. "Hydrogen can pretty much do everything, but that doesn’t mean it should," notes Russell McKenna at ETH Zurich, lead author of a study evaluating CO2 emissions from producing and transporting low-carbon hydrogen against potential displacement in 2000 planned projects.
The analysis identifies steel, biofuels, and ammonia as top priorities. In steel production, hydrogen can replace coke in blast furnaces, stripping oxygen from iron ore and emitting water instead of CO2. David Dye at Imperial College London states, "The technology we have today that’ll work to make iron at full industrial scale out of iron ore without making CO2, that technology is hydrogen." Projects include Stegra's planned carbon-free plant in northern Sweden by late 2026, using on-site green hydrogen from river water, though high electricity prices led ArcelorMittal to reject €1.3 billion in German subsidies.
Ammonia production, vital for 70 percent of fertilizers via the Haber-Bosch process, requires hydrogen input that cannot be electrified. McKenna explains, "We can’t electrify that… because it’s a chemical reaction that needs this input," advocating for decarbonized versions. Saudi Arabia is constructing solar- and wind-powered green ammonia factories for export, while US startups develop on-farm modular plants, both reliant on government support.
For alternative fuels, hydrogen enables hydrotreated vegetable oil from used cooking oil, impactful for shipping and aviation, sectors contributing 3 percent and similar shares of global emissions. Future innovations include fuel-cell aircraft. Phil Longhurst at Cranfield University calls hydrogen "the cleanest, most zero-carbon fuel we can get," deeming it "the Holy Grail."
