Q&A with ENGIE Impact’s Vincenzo Giordano

Even after a surge in awareness about its properties and how pivotal a role it can play in the energy transition, hydrogen is still not even responsible for 1% of global energy production.

Despite the hype and how game changing it can be, roadblocks in the form of availability, price competitiveness and inconsistent regulation is keeping it from mass adoption.

A chicken and egg problem arises here as a result, as demand is not sufficient for supply and vice versa.

You can read more about hydrogen in an upcoming Special Report in the October edition of Energy Digital. You can read the magazine here.

Vincenzo Giordano, Director, Sustainability Solutions at ENGIE Impact, is a seasoned energy sector veteran, with 20 years of diverse experience across energy transition strategy design and project implementation. At ENGIE Impact — which provides strategic advisory to help organisations plan their decarbonisation roadmaps — Vincenzo supports large, multinational organisations in their decarbonisation journey, particularly focusing on reduction strategies for Scope 1 and Scope 2 emissions. He also coordinates its European practice on Green Fuels.

Here, Vincenzo discusses not only what businesses can do, but also what the industry more broadly can do, to help hydrogen adoption gain momentum.

Q. Can you talk me through some of the challenges of hydrogen adoption?

The large-scale adoption of hydrogen as an energy carrier faces several significant challenges that need to be addressed:

• Limited availability: The availability of hydrogen, particularly green hydrogen produced from renewable sources, is still limited due to the developing infrastructure and supply chains required for its production and distribution
• Slow cost reduction: The costs of producing green hydrogen have not been decreasing as quickly as expected, which makes it challenging for potential users to adopt it at the anticipated level
• Lack of stable demand: Without a stable, long-term demand for green hydrogen, it is difficult to make a strong business case for investing in hydrogen projects, slowing down progress or leading to avoidance of such investments
• Need for regulatory and policy support: There is a general expectation that more regulatory interventions and policy support, such as subsidies for production and quotas or mandates for adoption, are necessary to reignite momentum and drive the implementation of green hydrogen projects.

While hydrogen shows great promise, coordinating solutions across this wide range of challenges will be key to ultimately realising its potential as a scalable, zero-emission energy carrier.

Q. How can businesses/governments/countries be strategic with their hydrogen adoption? Is there a particular approach you feel is best fit for success?

Businesses, governments and countries can strategically approach hydrogen adoption by identifying suitable applications where direct electrification is challenging, such as heavy industries and long-haul transportation. Additionally, having a forward-thinking mindset — for example planning hydrogen projects at least five years in advance — is crucial. 

In my view, one promising approach is the establishment of ‘Hydrogen Hubs’ across different regions. These hubs can serve as central points for collaboration between various stakeholders, enabling the efficient production, storage and distribution of hydrogen. By fostering such collaborative ecosystems, businesses and governments can leverage collective expertise and resources to drive progress more effectively.

Additionally, I believe it's crucial for businesses to focus on products that incorporate green hydrogen, such as fertilisers and green steel, where the additional cost of using hydrogen is a smaller fraction of the final product's price. This approach increases consumers' willingness to pay the premium for environmentally friendly alternatives.

For instance, the premium for a car made with hydrogen-based green steel is lower as a percentage of the total cost when compared to the premium for using green hydrogen instead of grey hydrogen as a standalone fuel.

Q. What can be done to ensure this roll-out happens globally and that no businesses/governments/countries are left behind?

To ensure this transition to green hydrogen happens globally and inclusively, a few key things need to happen. First, we need international coordination and alignment on certification standards and regulations for green hydrogen production. Having a universally accepted definition of what qualifies as ‘green’ hydrogen will allow for certification that is valid across regions. This will facilitate global trade and deployment of hydrogen solutions.

Despite recent market fluctuations, the hydrogen industry is not abandoning its potential. The sector is undergoing a necessary recalibration, ensuring that its path aligns with long-term sustainability goals. It is imperative to strike a balance between the initial hype surrounding green hydrogen and the potential for subsequent disillusionment, maintaining a measured and pragmatic approach.

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