Policy instruments for market introduction

chart with requirement of green hydrogen in different sectors, © Agora Energiewende
© Agora Energiewende 2021

The think tank Agora Energiewende in a joint study with the consulting firm Guidehouse analyzed the most important policy instruments for introduction of green hydrogen to the market. Along the route to climate neutrality in 2045, Germany needs 60 terawatt-hours of CO2-free hydrogen already by 2030, mainly for the development of a climate-neutral industry and security of electrical supply (Prognos et al. 2021). To promote the expansion of hydrogen production through renewables in an economically prudent way, financial resources should flow primarily to areas where future markets for green hydrogen are indisputably being created. So far, renewable green hydrogen is not yet competitive with hydrogen generated from fossil fuels, which is mostly produced by steam reforming of natural gas.

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