January 11, 2023. GTI Energy and S&P Global Commodity Insights announced a cohort of new stakeholders to their Open Hydrogen Initiative (OHI), a recently announced collaboration to further transparency into the environmental impact of hydrogen production and help unlock its full potential as a fuel alternative and important driver of energy transition. The mission is to create an industry-led objective, credible, and harmonized methodology and toolkit for measuring the carbon intensity of hydrogen production at the facility level to lay the foundation for a low-carbon hydrogen marketplace.
“The new Open Hydrogen Initiative participants announced today will provide crucial marketplace insight to vet the technical protocols and methodologies the initiative will ultimately develop for industry, policymakers, and investors,” said Paula Gant, Ph.D., President and CEO of GTI Energy. “Each founder and stakeholder brings various levels of technical support, R&D perspective, and real-world marketplace insights to close the methodology gap that undermines the commoditization of hydrogen.”
Development of the OHI measurement toolkit is already underway and ongoing, with a launch of demonstration projects targeted within the next 16 months. Initial stakeholder work is centered on the characterization of hydrogen production processes to understand energy and material flows and major emissions hotspots.
The Open Hydrogen Initiative is focused on identifying real-world applicability and credible carbon intensity values for a range of production methods, all critical to ensure a sustainable growth trajectory of hydrogen in the marketplace. Government programs to support the growth of a low-carbon hydrogen market are being implemented around the world.
“The Inflation Reduction Act in the US is just one example of regulators and market participants putting life-cycle carbon emissions at the center of strategies to support the growth of the hydrogen market. Peer-reviewed and transparent open-sourced measurement tools and methodologies are necessary to determine the carbon footprint of hydrogen entering the market. The European Union’s creation of the Hydrogen Bank, which will invest Euro 3 billion in low-carbon hydrogen projects, is another example of measures aimed at supporting the scaling of low-carbon hydrogen markets,” said Alan Hayes, Head of Energy Transition Pricing and Market Data at S&P Global Commodity Insights.
Subsequent to the COP27 inter-governmental discussions, it is clear that hydrogen remains one of the key routes available to advance projects worldwide that can contribute to decarbonization.
According to S&P Global Commodity Insights’ hydrogen outlook, global hydrogen demand grows from 70.4 million tons in 2020 to 97 million tons in 2030 and 249 million tons in 2050. Hydrogen demand is currently concentrated in oil refining and ammonia production, but nearly 90% of projected demand growth through 2050 comes from new sectors like heavy-duty transportation, steel production, and long-term energy storage. Decarbonizing hydrogen supply is critical to initiate uptake in these new sectors, and an industry-standard emissions measurement and verification process is key to providing the market transparency that facilitates new supply agreements.