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IEA’s new analysis suggests low-emissions hydrogen production could reach 37mn tonnes a year by 2030

Despite a recent wave of project delays and cancellations, low-emissions hydrogen production is still expected to expand to 2030, though at a slower pace than once signalled, according to the International Energy Agency (IEA)

The 2025 edition of the IEA’s Global Hydrogen Review, tracks developments across the sector with particular focus on low-emissions hydrogen technologies.

Worldwide hydrogen demand reached nearly 100mn tonnes in 2024, up 2% from 2023 and broadly in line with overall energy demand growth. Most of this demand was met by hydrogen produced from fossil fuels without emissions-capturing measures, with oil refining and industry remaining the main consumers.

Producing hydrogen from fossil fuels remains much cheaper globally, a gap widened by falling natural gas prices and rising electrolyser costs. But the report expects the cost gap to narrow by 2030 due to lower technology costs, stronger renewables growth in some regions, and new regulations.

Even so, uptake of low-emissions hydrogen is lagging behind expectations. High costs, regulatory uncertainty and slow infrastructure development have restrained growth, with production projects particularly exposed. The IEA’s new analysis suggests low-emissions hydrogen production could reach 37mn tonnes a year by 2030, down from the 49mn tonnes projected from announced projects just a year earlier.

Not all projects reach completion, meaning actual capacity is likely to be lower. Still, projects already operational, under construction or with a final investment decision are set to increase more than fivefold by 2030, reaching over 4mn tonnes per year. An additional 6mn tonnes could also materialise by the end of the decade if stronger policy support ensures demand.

“Investor interest in hydrogen jumped at the start of this decade thanks to its potential to help countries deliver on their energy goals,” said IEA executive director Fatih Birol. “The latest data indicates that the growth of new hydrogen technologies is under pressure due to economic headwinds and policy uncertainty, but we still see strong signs that their development is moving ahead globally. To help growth continue, policy makers should maintain support schemes, use the tools they have to foster demand, and expedite the development of necessary infrastructure.”

China remains the leading force in electrolyser deployment, accounting for 65% of installed or approved capacity and nearly 60% of global manufacturing. But the report warns that Chinese producers face challenges from excess capacity, as more than 20GW per year of output far outstrips current demand.

The review also highlights the shipping sector, finding that adoption of hydrogen-based fuels will require more compatible technologies and port readiness. Nearly 80 ports worldwide already handle chemical products, offering opportunities to manage hydrogen fuels in future.

A special section on Southeast Asia notes that announced projects could boost the region’s low-emissions hydrogen production to 430,000 tonnes a year by 2030, up from just 3,000 tonnes today. Achieving this will require faster renewables deployment, targeted policies and expansion of pilot projects.

Nurturing solar uptake in Africa

ZE-Gen, the Zero Emissions Generators initiative, has announced a new partnership with CLASP to drive competition and inspire innovation in solar-powered generators across Africa and other low-income regions

ZE-Gen is a collaborative initiative of the Carbon Trust and Innovate UK, both of which receive backing, directly or indirectly, from UK public funds.

CLASP is an NGO and authority on efficient appliances’ role in fighting climate change.

By promoting cleaner alternatives, the partnership aims to support efforts to phase out fossil fuel generators and expand access to sustainable energy solutions.

“The rapidly emerging market for solar-powered generators has huge commercial potential and offers a more reliable and safer solution for energy than highly polluting fossil fuel generators,” according to ZE-Gen lead, Lily Beadle, from Carbon Trust.

“Our new partnership with CLASP will develop a new quality assurance workstream which supports ZE-Gen’s wider programme of work and will help protect customers when they switch to renewable energy.”

The two sides also plan to launch a new international solar generator competition with US$100k in innovation prizes under the Global LEAP Awards, to showcase high-performing and efficient solar-powered generators designed for communities and SMEs.

Winners and finalists will be featured in a buyer’s guide that provides product performance information to support informed purchasing decisions.

The Global LEAP Award nominations open on 8 October 2025.

The new collaboration is part of ZE-Gen and CLASP’s broader work under the UK government’s Transforming Energy Access platform, part of the Ayrton Fund.

“In emerging economies, solar-powered generators are a game changer for people and businesses without access to reliable electricity,” said CLASP’s senior director, Africa, Emmanuel Aziebor.

“Testing and showcasing innovative, efficient and user-friendly products will support CLASP and ZE-Gen’s mission to ensure cleaner, affordable generators powered by renewable energy become the default option for communities everywhere.”

Globally, more than 82 million fossil fuel generators are still in use, contributing to pollution, greenhouse gas emissions, noise and health risks, with unpredictable fuel costs.

In contrast, modern solar-powered generators can offer cleaner, quieter and more cost-effective alternatives, though many do not consider them as robust or reliable as traditional thermal-based gensets, particularly in large industrial settings.

Historically, fossil fuel generators have dominated the market due to availability, upfront cost and perceived reliability.

However, modern high quality solar-powered generators eliminate the need for fuel, offering a potentially more sustainable and economical solution in certain resource-constrained settings.

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Nigeria keen to utilise its gas resources to power industry

Nigeria’s power sector and other industries are set to benefit from a strategic pact that aims to accelerate the development of gas infrastructure in the West African country
 
African Export-Import Bank (Afreximbank) and the Midstream and Downstream Gas Infrastructure Fund (MDGIF) together signed a memorandum of understanding (MoU) to establish a collaborative framework aimed at promoting and improving the use of Nigeria’s gas resources within the country.
 
Under the terms of the MoU, signed on the sidelines of the just ended fourth Intra-African Trade Fair (IATF2025), Afreximbank and MDGIF will work together with to mobilise US$500mn over a four-year period to support midstream and downstream gas infrastructure projects.
 
The investment is structured as a blend of senior debt and equity contributions, considered under both entities’ independent mandates, with a focus on accelerating the modernisation and expansion of Nigeria’s gas sector.
 
Oluwole Adama, MDGIF executive director, said the collaboration is aligned with President Bola Ahmed Tinubu’s agenda to harness Nigeria’s gas resources for industrialisation and economic growth.
 
“This partnership with Afreximbank enables MDGIF to mobilise capital, expand critical midstream and downstream infrastructure, reduce flaring, and deliver sustainable energy solutions that power industries, create jobs, and improve livelihoods across Nigeria.”
 
Kanayo Awani, executive vice president, intra-African trade and export development at Afreximbank, said it marked a “shared commitment” to accelerating Africa’s economic transformation.
 
“By combining Afreximbank’s deep expertise in trade and project finance with MDGIF’s national investment reach, we are poised to unlock new opportunities for inclusive growth and sustainable development across Nigeria and, potentially, across the West Africa sub-region.”
 
She added: “We stand ready to work with the MDGIF in advancing the development of gas infrastructure projects in Nigeria which will add value to the country’s natural resources.”
 
Key areas of collaboration Include:
 
Targeted gas infrastructure investment: Joint identification and prioritisation of eligible projects, with annual pipeline targets to ensure investment goals are met.
 
Senior debt financing: Afreximbank will consider providing direct financing and credit risk guarantees to support project finance transactions, working alongside local financial institutions.
 
Project preparatory support: Establishment of a dedicated support, either through funding or support framework, for feasibility studies, legal structuring, environmental assessments and other preparatory activities for bankable gas projects.
 
Equity financing: MDGIF will consider equity contributions to complement Afreximbank’s senior debt, enabling full capital structuring for eligible projects.
 
Promotion and advocacy: MDGIF will leverage Afreximbank’s platforms, including the Intra-African Trade Fair, to promote its initiatives and engage stakeholders.
 
Capacity building: Development of a structured programme to enhance MDGIF’s institutional capabilities in project structuring, risk management, and innovative financing.
 
A representative from Nigeria's Ministry of State for Petroleum Resource (Gas), noted: “Through this partnership, we are unlocking the potential to mobilise up to US$500mn over the next four years for Nigeria’s gas infrastructure. More importantly, we are creating a pipeline of bankable projects, supported by feasibility studies, project preparation, and risk-sharing mechanisms, that will accelerate the pace of investment in pipelines, processing.”
 
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Hydrogen and helium may be made up of small molecules but have a big role to play in the technology innovations of the future

From the natural gas that underpins power generation to the carbon dioxide emissions driving the climate crisis, there is no denying gases have a significant impact on modern life, according to Eve Pope, senior technology analyst at IDTechEx

The two lightest gases - hydrogen and helium - may be made up of small molecules but have a big role to play in the technology innovations of the future. Key application areas include mobility, power generation, and semiconductor manufacturing.

Hydrogen power

Hydrogen is an energy carrier that could replace fossil fuels to power the future. Fuel cells can convert hydrogen gas into electricity through a chemical reaction with oxygen. Because solid oxide fuel cells have a long operating lifetime and fuel flexibility, they are well-suited to the continuous power generation required for sustainable data centres. As the AI boom continues, some data centres are already using solid oxide fuel cells running on natural gas, with plans to transition over to low-carbon hydrogen once economics and infrastructure can make this commercially feasible.

For cars, fuel cell electric vehicles can also be powered by the reactions between stored hydrogen and oxygen in the air. Markets for fuel cell electric vehicles will depend upon national investments in green hydrogen projects and rollouts of hydrogen refueling stations.

Industrial decarbonisation of iron and steel enabled by hydrogen

For iron and steel, natural gas direct reduced iron (DRI) production using shaft furnaces is already mature. Hydrogen-based DRI (H2-DRI) processes represent the next logical evolution toward greener steel production. Midrex and Energiron shaft furnace plants have successfully demonstrated the use of hydrogen or hydrogen-rich gases, as evidenced in projects like HYBRIT by SSAB in Sweden and HBIS Group in China.

The success of hydrogen-based green steel production will depend heavily upon the availability of green and blue hydrogen and supporting infrastructure, with IDTechEx’s “Green Steel 2025-2035: Technologies, Players, Markets, Forecasts” report forecasting that 46 million tonnes of steel will be produced enabled by hydrogen in 2035.

Hydrogen and Helium 1Hydrogen isotopes for nuclear fusion

Even the heavier isotopes of hydrogen have a role to play. Deuterium and tritium are essential fuels for nuclear fusion technologies, hoped to provide energy-dense, continuous sources of green energy with no risk of meltdown. According to IDTechEx’s “Fusion Energy Market 2025-2045: Technologies, Players, Timelines” report, commercial fusion companies have raised over US$9bn to date, while an increasing number of governments see fusion as the modern day 'space race'. Players are pursuing different reactor designs and fuels, leading to various materials opportunities and supply chain challenges.

Helium required for semiconductor manufacturing

Helium is widely used in manufacturing processes due to its cooling and inert properties. It is crucial for thermal management during semiconductor production. As semiconductor manufacturing advances towards smaller nodes (essential for AI, autonomous vehicles, etc.), reliance on helium will continue to grow. Helium is a finite resource, so technologies for helium production and helium substitutes covered in IDTechEx’s “Helium for Semiconductors and Beyond 2025-2035: Market, Trends, and Forecasts” report will become increasingly essential.

Materials key to hydrogen and helium production

From the ion exchange membranes in electrolyzers for green hydrogen generation to the gas separation membranes used in helium and hydrogen production, the applications explored in this article represent significant opportunities for chemicals and materials companies. Materials for green hydrogen are needed for components such as catalysts, electrodes, porous transport layers, gas diffusion layers, bipolar plates, and gaskets. Innovations include new catalysts with less iridium content to cut costs. For gas separation membranes, the development of new palladium-alloy metallic membranes could unlock ultra-pure H2 separation.

Inauguration of the Grand Ethiopian Renaissance Dam (Image source: Office of the Prime Minister of Ethiopia)

Ethiopia has officially inaugurated its US$5bn Grand Ethiopian Renaissance Dam (GERD), almost a decade and a half after initial work commenced back in 2011

Africa's largest hydroelectric dam, electricity production has slowly increased since the first turbine was switched on in 2022, to now reach a maximum of 5,150MW of power.

The main dam, 170 metres high and 1,800 metres long, is the largest gravity dam in rolled concrete ever built in Africa.

Ethiopia now hopes the mega project — among the 20 biggest hydroelectric dams in the world — will provide energy to millions across the region.

At a ceremony at the site in Guba, Ethiopia’s Prime Minister Abiy Ahmed addressed a crowd of gathered dignitaries including the presidents of Somalia, Djibouti and Kenya— though not those of Egypt and Sudan, which have long expressed concerns about the project.

Egypt, which built its own Aswan High Dam on the Nile in the 1960s, fears it could restrict its water supply during droughts, and could encourage the construction of other upstream dams.

“To our [Sudanese and Egyptian] brothers; Ethiopia built the dam to prosper, to electrify the entire region and to change the history of black people,” said Abiy. “It is absolutely not to harm its brothers.”

Abiy added that the dam will improve access to electricity for almost half the population who had none as recently as 2022, as well export surplus energy to the region.

The project was designed and built by Italy-based Webuild - Webuild's CEO Pietro Salini also attended the inauguration event.

It has now completed 30 projects in Ethiopia, with a strong focus on the hydroelectric sector.

Others include the Beles Multipurpose Project, with an underground hydroelectric power plant — the largest in the country at the time of its inauguration — and the Gibe III dam on the Omo River, standing 250 meters high, which at the time of its opening was the highest RCC dam in the world.

Construction is currently underway for the Koysha Dam, the second largest hydroelectric project in Ethiopia after GERD, which will further contribute to the country's energy transition.

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