A new European Investment Bank (EIB) backed study into Africa’s green hydrogen potential has revealed that Africa could produce up to €1 trillion ($1.06 trillion) worth of green hydrogen a year by 2035.
The “Africa’s Extraordinary Green Hydrogen Potential” report was commissioned by EIB in partnership with International Solar Alliance and the African Union, and was supported by the Government of Mauritania, HyDeal and UCLG Africa.
According to the study, harnessing Africa’s solar energy to produce 50 million tons of green hydrogen a year by 2035 can help secure global energy supply, create jobs, decarbonize heavy industry, enhance global competitiveness and transform access to clean water and sustainable energy.
The new study represents the first detailed research of the feasible development of green hydrogen across the continent. The new study combines analysis of investment opportunities focusing on three hubs: Mauritania – Morocco, southern Africa and Egypt with a roadmap of technical, economic, environmental and financial solutions to unlock commercial development.
“Africa has the best renewable energy in the world and scaling up production of green hydrogen can transform access to low-cost electricity and clean water. Unlocking Africa’s green hydrogen potential will require close cooperation between public, private and financial partners,” said Ambroise Fayolle, Vice President of the European Investment Bank.
“The new “Africa’s Extraordinary Green Hydrogen Potential” study outlines what can be achieved and what needs to be done. The European Investment Bank is pleased to work with African and international partners to enable large scale green hydrogen to become a reality,” he adds.
Viability of solar produced green hydrogen
The study highlights that solar power produced green hydrogen is economically viable and can be produced at less than EUR 2 per kilogramme, cheaper than traditional fossil fuel energy, and cater both for local energy demand and allow green hydrogen to be exported to global markets. This is equivalent to energy costs of USD 60 a barrel.
“Solar photovoltaic technology has provided us with the cheapest electricity. It will cost below €2 per kg in several African countries by 2030, much lower than the current mass assumption of €5 and a stark contrast to the $60-70 paid for an oil barrel. Thanks to this low-cost electricity and decreasing electrolyser costs, the next step is providing access to a clean fuel, cheaper than all the current fossil fuels. It will enable us to decarbonise the power sector and most hard-to-abate sectors – fertilisers, steel manufacturing, and refineries.” said Dr Ajay Mathur, Director General, International Solar Alliance.
Steps to Africa’s green hydrogen economy
The report suggest three requirements to enable 50 million tons of green hydrogen to be produced in Africa by 2035;
- National planning, regulation and incentive schemes need to mobilise private sector investment.
- Pilot projects need to show successful green hydrogen generation, storage, distribution and use at both demonstration and commercial scale.
- Market-based partnerships are needed to enable mass-scale domestic and international off-take and demand for green hydrogen, and increase cooperation to design, finance, build and operate green hydrogen production, storage and distribution infrastructure.
EUR 1-trillion green hydrogen investment can deliver the equivalent of more than one third of Africa’s current energy consumption, boost GDP, improve clean water supply and empower communities.
The new study outlines how production and transmission of green hydrogen can lead to a EUR 1-trillion investment yielding 7 exajoules of energy (versus a consumption in Africa of 19.9 exajoules in 2021) and a correlative massive increase in GDP, creating hundreds of thousands of permanent and skilled jobs across Africa.
Large scale green hydrogen investment will transform supply of clean water in areas regularly impacted by drought and chronic water shortages and will help empower communities.
According to the study, large-scale green hydrogen generation will enable Africa to supply 25 million tons of green hydrogen to global energy markets, equivalent to 15% of current gas used in the European Union.
