The UAE has the foundations and competitive advantages to become one of the largest and lowest-cost producers of low-carbon hydrogen in the world, according to a recently published report entitled ‘The United Arab Emirates’ Role in the Global Hydrogen Economy.
The report, co-authored by Dr. Julio Friedmann, a Senior Research Scholar at Columbia University SIPA’s Centre on Global Energy Policy, and Mr. Robin Mills, CEO of Qamar Energy and a non-resident fellow at the Arab Gulf States Institute in Washington, D.C., explains the importance of hydrogen as a future fuel and the UAE’s strong start in leveraging existing assets to position itself at the frontline.
Hydrogen is likely to play a key part in global decarbonization and sustainable development policies, as well as the global transition to lower-carbon energy sources. According to the Hydrogen Council, it is expected to account for up to 18 percent of global energy demand by 2050, with over 30 countries having announced hydrogen roadmaps and more than 228 large-scale projects active across the hydrogen value chain. For global energy providers, tapping into this growing demand represents a significant opportunity.
Abu Dhabi National Oil company (ADNOC) being the largest oil company in the UAE is working on decarbonization and hydrogen fuels. The company recently announced the sale of three blue ammonia cargos to Japanese consumers, as well as plans to build a new one-million-ton-per-year blue ammonia plant at TA’ZIZ in Ruwais.
In its downstream facilities, ADNOC already produces over 300,000 tons of hydrogen per year, which is primarily used for industrial purposes. The company has plans to increase its hydrogen production to 500,000 tonnes per annum and is progressing a number of new growth opportunities, particularly in blue ammonia.
“Alongside ADNOC’s existing infrastructure and commercial-scale carbon capture, utilization, and storage (CCUS) capabilities, it can become a major player in developing the blue hydrogen market. ADNOC was developing a roadmap to create a hydrogen ecosystem to serve both the UAE and the global market. We are working with our partners, our customers and other parties to create the value chains needed to kick-start the emerging hydrogen market globally.”
According to the report, the UAE has considerable natural advantages, in addition to its current infrastructure and production capabilities for both blue and green hydrogen. Blue hydrogen is produced from natural gas with the associated carbon captured and stored underground while green hydrogen refers to hydrogen made from the electrolysis of water with renewable electricity and minimal CO2 emissions.
The UAE’s attempts to produce green hydrogen will benefit from the country’s outstanding solar generation conditions and low solar electricity levelised cost. Several green hydrogen initiatives have been launched by the Abu Dhabi Future Energy Company (Masdar), including the development of a green hydrogen demonstrator plant in Masdar City in collaboration with Siemens Energy, Marubeni, Etihad Airways, Lufthansa Group, Khalifa University of Science and Technology (KU), and the Abu Dhabi Department of Energy (DoE).
A nascent market must be formed to provide certainty to producers and consumers for the hydrogen economy to take shape sustainably. Fortunately, the UAE has a long history of public-private partnerships in the energy, infrastructure, and heavy industry sectors with both domestic and international entities. The formation of the Abu Dhabi Hydrogen Alliance between ADNOC, Mubadala Investment Company (Mubadala), ADQ and the UAE Ministry of Energy and Infrastructure (MoEI) was an important step in what has become a coordinated effort to build the nation’s hydrogen economy.
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