Helping Developing Countries Decarbonize Hard-to-Abate Sectors through the Scale Up of Green Hydrogen Solutions
Drastic action is needed across all the sectors of the world’s economy to limit the increase in average global temperature to 1.5 degrees Celsius (34.7 degrees Fahrenheit) above pre-industrial levels. Limiting greenhouse gas emissions is a challenge, particularly in hard-to-abate sectors such as cement and steel production, shipping, and heavy road transport. Hydrogen produced with renewable energy resources, also known as green hydrogen, can help address the reduction of greenhouse gas (GHG) emissions in these sectors while also providing a low-cost, flexible option for energy storage.
However, specialized knowledge and capabilities are required to ensure the safety of green hydrogen’s production, storage, and use. In addition, the necessary policies, regulations, and standards must also be established to ensure project bankability.
In 2020, ESMAP’s Green Hydrogen Support Program was established as an independent initiative under the Fiscal Year 2021–24 Business Plan. The program aims to raise awareness about the potential for green hydrogen to create economic opportunities in developing countries and decarbonize energy-consuming activities. The Green Hydrogen Support Program assists governments in developing countries to identify the short- and long-term green hydrogen opportunities. It also addresses the challenges associated with the deployment of green hydrogen projects, such as technology risks, capacity building, regulatory requirements, and economic analyses.
In collaboration with teams from the International Finance Corporation (IFC), the Green Hydrogen Support Program works at the country level, to prioritize diesel-based power systems, island locations, and critical infrastructures. There is also a strong focus on regions with excellent renewable resources, and countries producing and consuming hydrogen and derived products (ammonia and methanol).
The program aims to support the World Bank clients to create an enabling environment to scale up green hydrogen projects through two main workstreams:
- Grants and Technical Assistance: Between 2020 and 2021, the program directly supported four green hydrogen country activities. The program is currently offering technical support to projects in Chile, Georgia, Kazakhstan, Kyrgyzstan, Nepal, Uzbekistan, Tajikistan, and Tunisia.
- Global Knowledge: The program leads knowledge creation on green hydrogen across the World Bank Group. It uses knowledge-sharing activities and advisory to support teams preparing green hydrogen technical assistance engagements. In collaboration with IFC’s Upstream department, the program is currently co-funding a global green hydrogen report to create an opportunity analysis framework and identify private sector opportunities in the green hydrogen sector in developing countries.
- In India, the Green Hydrogen Support program provided a grant to fund the “Green Hydrogen Opportunities and Roadmap for India,” linked to the “Supporting Energy Transition of India Power Sector” project. The project supports the Government of India to promote green hydrogen within the country based on a gap analysis, benchmarking for leading countries and identifying early entry points through demonstration and pilot projects. The engagement also includes capacity- building opportunities, including skilling the workforce, to facilitate a green hydrogen transition in India.
- In Namibia, the program supported activities alongside the government to deepen the understanding of green hydrogen and green ammonia production costs and the sectors that could benefit from a green hydrogen economy, including the possibility of exporting green ammonia overseas. As a result of this work, the government is keen to develop and implement national green hydrogen and ammonia strategies as part of a nationwide economic prosperity initiative. The Government of Namibia would like to use a public-private partnership to develop a world-class, renewable energy-powered, mega-project. The Green Hydrogen Support program, in collaboration with the World Bank, plans to mobilize a technical committee of experts to provide technical support to review the different analyses involved in the implementation of the strategy.
- In 2020, the program compiled the Green Hydrogen in Developing Countries Report, which illustrates current and potential areas of deployment for green hydrogen production and fuel cell technologies in developing countries. The report is meant to inform the decisions of technical experts working with investors and governments to develop national roadmaps and assess the applications in which green hydrogen can deliver gains.