From Uche Usim, Washington DC
The World Bank, on Monday, said that Nigeria and other Emerging Markets and Developing Countries (EMDCs) require a whooping $600 billion investments to achieve the clean hydrogen energy project by 2030.
The largest hydrogen project under construction is in Saudi Arabia, which is projected to come on stream in 2026.
To make the funding less suffocating, the World Bank said it requires a $100 billion yearly investment till 2030, which is in six years time.
The World Bank, in its report, Scaling Hydrogen Financing for Development” projected that clean hydrogen would become a major source of energy in the world by 2030.
According to the report, hydrogen is widely seen a key component of the global energy transition, notably for its potential to decarbonize hard-to-abate sectors, such as heavy industry (cement, steel and chemicals) and heavy-duty transport (trucking, shipping and aviation).
The report said: “Scenario studies and the project pipeline suggest that EMDCs have the potential to attract Clean hydrogen investments in the order of $100 billion per year between now and 2030, more than a ten-fold increase from present levels.”
The outlook of key findings of the report indicated that to meet global climate goals, EMDCs must play a key role and supply half of global production, equivalent to 20 metric tonnes per annum by 2030.
“A global hydrogen economy will change the geopolitics of energy and could become an engine for for sustainable economic growth in Emerging Markets and Developing Countries.
“Several EMDCs are well positioned to.become first movers in the development of this new value-chain, both for domestic consumption and for export”, the report said.
It further explained that many countries have already designed strategies and roadmaps to operationalise their ambitions, adding that as a next step, well-aligned policies adapted to those strategies remain necessary to leverage private sector financing and mitigate the risks of first movers’ investments.
Action plan to accelerate Clean hydrogen deployment in EMDCs centres on a series of renewable hydrogen lighthouse projects designed to increase investor confidence.
The report further called for more transparent price information on Clean Hydrogen should be created, noting, renewable hydrogen produced from wind and solar has a current production cost of $3/1kg and warned that the production cost could rise to $10/1kg under less favourable conditions.
It, therefore, encouraged EMDCs to come up with policies to de-risk clean hydrogen production in order to attract private capital to the sector.
As the global energy transition song crescendos, there has been a relentless push for cleaner energy as the world battles to rescue the planet from the devastation of climate change, which is accentuated by fossil fuels.
However, Nigeria has pitched gas as its energy transition fuel, which urging global leaders to allow for the retention of crude oil as a major energy source since Africa was one of the lowest in carbon monoxide emission.