November 09, 2021
The pledges equate to nearly one quarter of the decarbonization potential for hydrogen by 2030, as estimated by the Hydrogen Council
Glasgow, COP26, Tuesday 9 November – This new initiative, comprising of these companies – H2Zero – will accelerate the use and production of hydrogen as an essential part of the future net-zero energy system.
Pledges across three categories – demand, supply and financial or technical support – have been made by 28 companies representing different sectors from mining to energy, vehicle and equipment manufacturers, and financial services.
The Hydrogen Council estimates that in 2030, the decarbonisation potential for hydrogen could equate to approximately 800 million tonnes per annum (mtpa) of carbon dioxide (CO2) emissions avoided. The pledges announced today equate to nearly one quarter of this total.
On the demand side, the pledges – which total 1.6 mtpa of lower-carbon intensity hydrogen – focus on replacing grey hydrogen, currently used widely in the refining, chemical and fertilizer sectors, or diesel fuel used in heavy industries such as mining. This would reduce carbon dioxide emissions by more than 14 million tons a year – the equivalent to the annual emissions of more than six million cars in Europe.
On the supply side, the pledges add up to more than 18 mtpa of lower-carbon hydrogen. This would avoid about 190 million tons a year of CO2 emissions, if it replaces grey hydrogen, natural gas for industrial heat and petroleum fuels in transportation. This would be the equivalent of nearly the combined annual emissions of The Netherlands and Tunisia.
“The uncertainty over supply and the lack of commitment for demand are two challenges associated with the development of hydrogen as part of the global energy system,” said Ben van Beurden, Chief Executive Officer of Shell and Chair of the Hydrogen Taskforce at SMI. “We brought companies together to tackle this status quo and send a strong signal to markets and governments for hydrogen to reach its full potential.”
“Our hope is that these combined pledges spark investments in supply and inspire other users to transition to hydrogen,” added Claire O’Neill, Senior Advisor at WBCSD and former COP26 President-Designate. “To further accelerate the development of the hydrogen market, we are encouraging more companies to join this effort and make pledges. We stand ready to work with any company from any sector who is interested in driving progress towards a net-zero, nature positive and equitable future for 9+ billion people to live, within planetary boundaries, by 2050.”
Transforming the global energy system will require unprecedented collaboration between the private and public sectors. Policymakers are required to create a stable investment framework that will accelerate the deployment of clean hydrogen, creating numerous opportunities for employment and economic development.
SMI recently published policy recommendations to accelerate the adoption of hydrogen fuel cells specifically for transportation, while WBCSD recently published a set of policy recommendations to accelerate the deployment of hydrogen with the lowest possible carbon intensity. The deployment and rapid scaling up of hydrogen will be crucial to helping countries and businesses alike meet their net-zero emissions commitments by 2050.
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The various shades of hydrogen – Steppingstones to net-zero
Not all hydrogen is created equal. The end goal is a net-zero hydrogen economy, but the journey towards the end-goal will take different routes depending on starting points, local conditions, and regulatory frameworks. The pledges make use of different categories of hydrogen, as defined in WBCSD’s Policy Recommendations to accelerate hydrogen deployment for a 1.5 °C scenario. Key differentiation is based on life-cycle carbon emissions per kilogram of hydrogen produced, from reduced to low-carbon (aligned with the taxonomy developed by the European Commission) to ultra-low-carbon and eventually towards net-zero hydrogen. On top of this, this initiative distinguishes renewable production based on solar, wind and hydro power.
Explanatory note on estimated hydrogen and CO2 avoided numbers:
Pledges have been added (demand and supply side separately) using information provided by the pledging companies, based on their own internal calculations, business plans and forecasts.
The quantity of CO2 avoided has been added based on forecast use of hydrogen provided by the pledging companies and is driven by lower carbon intensity hydrogen replacing grey hydrogen in refining, chemicals and fertilizer production, replacing natural gas, or replacing petroleum based fuels in transportation. The reduction is approximately 10 kg of CO2 avoided per kg of H2 consumed, on average.
A more detailed range of assumptions used can be found in the explanatory note at the end of the pledge document.
Acciona, Anglo American, Bank of America, bp, CLP, Cummins, EDF, EDP, 8 Rivers, Enel, Engie, Equinor, ERM, Fortescue, GenComm, Hinicio, Johnson Matthey, Linde, Iberdrola, ITM Power, River Simple, Shell, Siemens Energy, Snam, TotalEnergies, Yara, Yokogawa, Yosemite Clean Energy.
WBCSD is the premier global, CEO-led community of over 200 of the world’s leading sustainable businesses working collectively to accelerate the system transformations needed for a net zero, nature positive, and more equitable future.
We do this by engaging executives and sustainability leaders from business and elsewhere to share practical insights on the obstacles and opportunities we currently face in tackling the integrated climate, nature and inequality sustainability challenge; by co-developing “how-to” CEO-guides from these insights; by providing science-based target guidance including standards and protocols; and by developing tools and platforms to help leading businesses in sustainability drive integrated actions to tackle climate, nature and inequality challenges across sectors and geographical region.
Our member companies come from all business sectors and all major economies, representing a combined revenue of more than USD $8.5 trillion and 19 million employees. Our global network of almost 70 national business councils gives our members unparalleled reach across the globe. Since 1995, WBCSD has been uniquely positioned to work with member companies along and across value chains to deliver impactful business solutions to the most challenging sustainability issues.
Together, we are the leading voice of business for sustainability, united by our vision of creating a world in which 9+ billion people are living well, within planetary boundaries, by mid-century.
His Royal Highness, The Prince of Wales, launched the Sustainable Markets Initiative (SMI) at Davos in January 2020. The SMI is a network of global CEOs and private sector corporations working together to build prosperous and sustainable economies that generate long-term value through the balanced integration of natural, social, human and financial capital.
The SMI facilitates the development of responsible transition pathways at industry and business levels to decarbonize and achieve net-zero, create a Nature-positive future and support a trust transition towards a sustainable future.
HRH is appealing to public, private and philanthropic leaders around the world to join this endeavour as part of the ‘Coalition of the Willing’.
Read more: www.sustainable-markets.org