Energy

Global hydrogen demand reached 97Mt in 2023, an increase of 2.5% compared to 2022. (Image source: Canva)

According to the International Energy Agency (IEA), while investment and projects in low-emissions hydrogen are increasing, policies to stimulate demand in key sectors are required to accelerate deployment

These are the findings published in the organisation’s Global Hydrogen Review 2024, an annual publication that tracks production and demand worldwide in a bid to inform energy stakeholders on the status and future prospects of low-emissions hydrogen.

The research shows that a wave of new projects indicates the growing momentum around low-emissions hydrogen despite challenges such as regulatory uncertainties, persistent cost pressures, and a lack of incentives to accelerate demand from potential consumers. In the last 12 months, the number of projects that have reached final investment decision has doubled – this would increase today’s global production of low-emissions hydrogen fivefold by 2030. The total electrolyser capacity has reached final investment decision now stands at 20GW globally.

However, the IEA reports hesitancy from developers due to a lack of clarity on government support before making investments. As a result, most potential projects are still in planning or early-stage development, and some larger projects face delays or cancellations.

“The growth in new projects suggests strong investor interest in developing low-emissions hydrogen production, which could play a critical role in reducing emissions from industrial sectors such as steel, refining and chemicals,” remarked IEA executive director Fatih Birol. “But for these projects to be a success, low-emissions hydrogen producers need buyers. Policymakers and developers must look carefully at the tools for supporting demand creation while also reducing costs and ensuring clear regulations are in place that will support further investment in the sector.”

Hydrogen demand against production

Further key findings from the report include a notable gap between government goals for production and demand. According to the research, production targets set by governments add up to as much as 43mn tonnes per year by 2030, but demand targets only total 11mn tonnes by 2030. While some government policies are already in place to stimulate demand, the progress made in the hydrogen sector so far is not sufficient to meet climate goals.

Moreover, as a nascent sector, low-emissions hydrogen still faces technology and production cost pressures, with electrolysers in particular slipping back on some of their past progress due to higher prices and tight supply chains. A continuation of cost reductions relies on technology development, but also optimising deployment processes and moving to mass manufacturing to achieve economies of scale.
Cost reductions will benefit all projects, but the impact on the competitiveness of individual projects will vary. Industrial hubs – where low-emissions hydrogen could replace the existing large demand for hydrogen that is currently met by production from unabated fossil fuels – remain an important untapped opportunity by governments to stimulate demand, according to the IEA.

Hydrogen potential in emerging markets

Regarding emerging markets and developing economies (EMDEs), the report notes that such regions (particularly Africa and Latin America) hold significant potential for low-cost, low-emissions hydrogen production.

To unlock this potential, the IEA advises, governments of advanced economies and multilateral development banks should look to provide targeted support such as grants and concessional financing in order to address key challenges that are inhibiting project developers in these countries – most notably, around financing. Developing these projects, the research reports, can help cover domestic needs, reduce import dependencies and potentially enable the export of hydrogen or hydrogen-based products.

The IEA is not the only organisation that has noted the significant opportunities that hydrogen can offer Africa. Click here to discover why Synergy Consulting sees the emerging hydrogen economy as a key element in the sustainable future of southern Africa.

WETEX is organised by DEWA. (Image source: Ducab Group)

Ducab Group, a major provider of end-to-end solutions and manufacturing in the UAE, will showcase its latest energy-efficient and sustainable innovations for the utilities sector at WETEX 2024.

WETEX 2024, organised by Dubai Electricity and Water Authority (DEWA), will be held from October 1-3 at the Dubai World Trade Centre. The event, which focuses on water, energy, and sustainability, will bring together leading local and international companies to highlight the latest technological advancements and trends in renewable energy and environmental sustainability.

Ducab Group will feature its range of specialised cable solutions, which have supported over 30 global renewable energy projects in the last 40 years. A key focus will be Ducab’s High Voltage Unit (Ducab HV), the first in the Middle East to provide high (60-150kV) and extra high voltage (220-500kV) cable solutions. 

Supporting the UAE's renewable energy goals

Since its launch in 2011, Ducab HV has supplied more than 6,758 km of cables to DEWA, playing a crucial role in strengthening Dubai’s power distribution network and aligning with the city’s goal to generate 75% of its power from clean energy sources by 2050.

Additionally, Ducab’s High Voltage facility has been integral in the development of the Mohammed bin Rashid Al Maktoum Solar Park (MBR Solar Park), delivering approximately 1,033 km of high-voltage cables. These contributions are vital for the solar park’s planned expansion to a 5GW capacity by 2030, reinforcing its status as the largest single-site solar park in the world.

"We are thrilled to participate in WETEX 2024, a vital gathering for the global energy sector. Our commitment to sustainability drives our efforts to adopt and implement cutting-edge technologies and digital strategies. This alignment not only supports the UAE's renewable energy ambitions but also resonates with our dedication to the Year of Sustainability,” said Charles Mellagui, CEO of Ducab Cables Business.

“WETEX provides an unparalleled platform for us to engage with industry leaders, discuss new trends, and develop strategies that address environmental challenges effectively. We are eager to share our advancements, reinforce our ongoing partnerships with DEWA, and forge new ones, furthering our role in Dubai's Clean Energy Strategy 2050 and demonstrating our relentless pursuit of sustainability and excellence," he added.

81% of large-scale renewable energy projects were developed at a lower cost than their fossil fuel counterparts. (Image source: Adobe Stock)

Renewable energy remains highly competitive, even as fossil fuel prices return to more typical levels, according to Renewable Power Generation Costs in 2023, a report released by the International Renewable Energy Agency (IRENA) at the Global Renewables Summit during the UN General Assembly in New York.

The report highlights that of the record 473 GW of new capacity added in 2023, 81%—equivalent to 382 GW—of large-scale renewable energy projects were developed at a lower cost than their fossil fuel counterparts.

IRENA’s findings show that after years of falling costs and advancing technologies, particularly in solar and wind, the benefits of renewables—both socio-economic and environmental—are more compelling than ever.

Solar PV costs in 2023 dropped dramatically, averaging just four US cents per kilowatt-hour, making them 56% cheaper than fossil fuel and nuclear alternatives. Since 2000, the deployment of renewable power has saved up to US$409bn in fuel costs in the global power sector.

“Renewable power remains cost-competitive vis-à-vis fossil fuels," said IRENA’s director-general, Francesco La Camera. "The virtuous cycle of long-term support policies has accelerated renewables. In return, growth has led to technology improvements and cost reductions. Prices for renewables are no excuse anymore, on the contrary. The record growth of renewables in 2023 exemplifies this. Low-cost renewables represent a key incentive to significantly increase ambition and triple renewable power capacity by 2030, as modelled by IRENA and set by the UAE Consensus at COP28.”

IRENA projects that meeting the goal of tripling renewable energy capacity by 2030 would require global renewable capacity to reach 11.2 TW, with an average of 1,044 GW of new capacity added each year. Solar PV and onshore wind are expected to contribute 8.5 TW of this growth, according to IRENA’s World Energy Transitions Outlook.

Achieving this target will also rely on key enablers like energy storage. The cost of battery storage projects has dropped by 89% since 2010, helping to address challenges in grid infrastructure and facilitating the integration of higher shares of solar and wind energy.

Asian markets to see more growth

La Camera added, "In the coming years, remarkable growth across all renewable energy sources is expected, giving countries great economic opportunities. Our analysis indicates that solar PV and onshore wind will have the biggest impacts on the tripling of renewables. Thanks to low-cost renewables in the global market, policymakers have an immediate solution at hand to reduce fossil fuels dependency, limit the economic and social damage of carbon-intensive energy use, drive economic development and harness energy security benefits."

In 2023, the global weighted average cost of electricity from new renewable projects saw declines across several technologies: solar PV dropped by 12%, onshore wind by 3%, offshore wind by 7%, concentrating solar power by 4%, and hydropower by 7%.

Non-OECD economies, where electricity demand is growing and new capacity is needed, will benefit significantly from renewable energy projects. These projects, developed at lower costs than fossil fuel-based alternatives, will reduce electricity system costs throughout their operational lifespan.

Asia saw the highest cumulative savings between 2000 and 2023, with an estimated US$212bn, followed by Europe with US$88bn, and South America with US$53bn.

Renewable power generation is now the most cost-effective option for new power projects. Policymakers and stakeholders need to ensure that policies, regulations, market structures, and financing are aligned with the goal of tripling capacity, with updates to Nationally Determined Contributions for the Paris Agreement expected by 2025.

The 2606 engine is compatible with renewable liquid fuels. (Image source: Perkins)

Perkins has unveiled its new Perkins 2606 diesel engine, specifically designed and optimised for electric power generation.

Initially targeting regions with limited or no emissions regulations, the 13-litre, six-cylinder engine is built on the proven Perkins 2600 Series platform, known for its high power density and fuel efficiency. The industrial platform, introduced last year, has already undergone more than 30,000 hours of design validation, with over 120 patents granted or pending across the entire engine series. Commercial production of the 2606 engine is set to begin in the second half of 2025.

Delivering between 321-523 kW of prime power and 365-572 kW for standby use, the new engine enhances Perkins' electric power range. Its flexibility allows it to switch seamlessly between 50 and 60 Hz, as well as accommodate various voltage requirements, making it suitable for diverse regions and applications such as data centres, industrial sites, power plants, and remote work locations.

The 2600 Series is engineered to operate in challenging conditions, handling altitudes up to 3,500 metres and extreme temperatures ranging from -40°C to 60°C.

Compatibility with HVO

The engine’s design improvements, such as integrated components and a 45% reduction in leak joints, contribute to enhanced reliability, lower fluid consumption, and extended service intervals of up to 1,000 hours for oil and fuel filters—minimising downtime and reducing operational costs.

Additionally, the 2606 engine is compatible with renewable liquid fuels, including 100% hydrotreated vegetable oils (HVO), B100 distilled biodiesel, and up to B100 fatty acid methyl ester (FAME) biodiesel. To ensure optimal performance and reliability, users must adhere to the official Perkins fuel guidelines available on their website. The engine’s architecture also supports future developments in natural gas and hydrogen fuel technologies.

"Generator sets remain essential for both stationary and mobile power generation, particularly in areas where the electrical grid is unreliable or non-existent," said Jaz Gill, vice president of Perkins global sales, marketing, service, and parts. "Diesel engines continue to power these systems, and the Perkins 2606 engine leverages our investment in the 13-litre platform to deliver a versatile, high-performing power solution with low ownership and operating costs."