Global investment in clean hydrogen has surged past $110 billion, defying growing doubts about the fuel’s future following a wave of project cancellations, according to a report highlighted by the Financial Times.
The study, commissioned by the Hydrogen Council, found that $35 billion of new projects reached a final investment decision in the past year, with pledged investment rising more than 50% annually since 2020. The report covers over 500 green and blue hydrogen projects worldwide.
“The pendulum has been swinging between exuberant enthusiasm — or hype — and doom and gloom,” said Ivana Jemelkova, chief executive of the Hydrogen Council. “If you tell me hydrogen is dead, I can show you 500-plus examples that it’s not.”
Hydrogen, which emits only water vapor when burned, is seen as a key alternative to oil and gas. It is widely used in refineries, fertilizer production, steelmaking, and powering heavy machinery and vehicles. Yet its production, storage, and transportation remain costly and technically challenging, limiting demand at current prices.
While at least 50 projects have been abandoned in the past 18 months by major players such as BP, Shell, ArcelorMittal, and Iberdrola, Jemelkova emphasized that these closures reflect “natural attrition” rather than a broader slowdown, drawing parallels with the early solar industry.
China and the United States account for more than half of the total investment. China has prioritized “green” hydrogen, produced using renewable electricity to split water, whereas the US has focused on “blue” hydrogen, derived from natural gas with carbon capture and storage.
Currently, there is one million tonnes of hydrogen capacity in operation globally, with another five million tonnes under construction—equivalent to roughly half of US consumption. Sanjiv Lamba, CEO of industrial gas group Linde and Hydrogen Council co-chair, noted that while the figures fall short of earlier expectations, they demonstrate that large-scale projects can still be competitive.
Much of the recent investment comes from a handful of mega-projects, including four large plants in China, Blue Point in the US, and projects developed by India’s Hygenco and Switzerland’s Ameropa.
“We’re seeing projects that are bigger and supported by the strongest technologies,” said Pierre-Etienne Franc, head of asset manager Hy24, which has invested $2 billion in clean hydrogen. “Developers have disappeared, some gigantic projects have disappeared as well. But if you really look at the figures, they’re far better than what people were saying on the market.”
Franc added that growth is increasingly concentrated in Asia, the Middle East, and the US, while Europe lags behind. Critics, including Lamba, have cited a “lack of pragmatism” and reluctance to consider blue hydrogen as a transitional option as major constraints for the EU.
ExxonMobil’s proposed Baytown blue hydrogen plant in Texas remains one of the largest potential projects, though the company has yet to make a final investment decision. Exxon CEO Darren Wood told analysts, “If we can’t see an eventual path to a market-driven business, we won’t move forward with the project.”
