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Sinan Küfeoğlu
Department of Engineering
University of Cambridge

3
Sinan Küfeoğlu

There is growing interest in the hydrogen economy and businesses that deploy
hydrogen worldwide. The desire to tackle the adverse effects of climate change, achieve
a green transition and deep decarbonisation, ambitious future net-zero targets of
numerous countries, increasing pressure for energy security, and being self-reliant are
reasons behind this interest. However, hydrogen is not a new phenomenon. Nowadays,
many people ask if the hydrogen economy has a future. The answer is not
straightforward, as the hydrogen economy has numerous different application areas.
The main question is which hydrogen applications can be deployed commercially and
which business cases are not viable. This paper investigates 20 prominent hydrogen-
related business opportunities and reviews a sample of 64 companies' business models
from 18 countries worldwide. The paper aims to highlight which cases are viable now
and which ones are likely to be viable in the future. Our aim is to present a broad horizon
scanning along the value chain for the global use of hydrogen as a commercial entity.
Figure A shows 20 business opportunities directly and indirectly related to the wider
hydrogen economy and their viability assessment in the market, where grey indicates
high carbon hydrogen, and the rest is low carbon hydrogen. Our initial horizon scanning
reveals that majority of the business opportunities lack generating self-sustaining
revenues, hence they are away from being mature businesses. In this paper, we listed
several observations and remarks specific for each business and their viability.
 Figure A. Market Phases of Hydrogen Businesses

Key words: Hydrogen, Hydrogen economy, Energy, Business, Low carbon transition

5
Hydrogen is the amplest chemical element in the universe, but on earth it generally

needs to be separated from water, hydrocarbons, or other organic substances. Hydrogen

use is not new, having been used as a feedstock in, for example, the refining and

petrochemical industries for many years. The focus now is on hydrogen as a low-carbon

fuel source, but much of this technology is also not new. For example, alkaline hydrolysis

was patented initially by Amos Herbert Hobson from England on December 25, 18881.

Similarly, the first car to use a hydrogen fuel cell was invented by General Motors in

19662. These applications did not penetrate the market because of the lack of value for

money and revenue generation at that time. The economic viability of many of the

hydrogen applications is still unproven or debatable today and, in many cases, will rely

on government policy support.

The future hydrogen economy broadly means using hydrogen as a low-carbon

energy source. Further extending this definition, the hydrogen economy covers the

commercial use of hydrogen in all suitable economic sectors. The hydrogen value chain

broadly covers:

i) upstream: input fuels/energy and production technologies,

ii) midstream: hydrogen and CO2 storage and transportation,

iii) downstream: end uses, and links with related economic activities

The hydrogen economy can be regrouped under three dimensions: production,

networks and use. To give further details, production covers grey, electrolytic (“green”)

and CCUS-enabled (“blue”) hydrogen. Networks include pipelines and other

infrastructure, including storage and facilities to ship hydrogen and derivatives. And

finally, use is end-use activities such as industry, power, residential heating and

transport (maritime, aviation and heavy long-haul freight). The value chain also includes

derivatives such as ammonia, methanol and other substances, CO2 capture (Carbon

Capture Utilisation and Storage (CCUS)), as well as energy inputs such as renewables,

natural gas, nuclear and biomass3.

1 Wilson, J.H., 2014. The history of alkaline hydrolysis. Good Funeral Guide.
2 GM Heritage Center, 2019. GM Hydrogen Fuel Cell Vehicles.
3 HM Government, 2021. UK Hydrogen Strategy.
 This paper covers an overview of 20 potential business opportunities in the low

carbon hydrogen value chain. This includes production technologies, hydrogen and CO2

transportation and storage, end-use of hydrogen as feedstock, and links with related

economic activities. Section 2 summarises the contemporary challenges and various

goals related to hydrogen use as a low carbon transition asset. Section 3 explains the

adopted business model theory and its application. Section 4 introduces 20 direct and

indirect hydrogen use cases and business opportunities. We then conclude that paper

with a brief discussion and conclusion.

Drawing on examples from the United Kingdom (UK) and European Union (EU), this

section outlines some of the ambitious targets envisaged for low carbon hydrogen and

some of the challenges in achieving them.

The UK Energy Security Strategy outlines their goal of building up to 10GW of

low-carbon hydrogen production capacity by 2030, subject to affordability and value for

money, with electrolytic hydrogen accounting for at least half of it 4 . The UK has

established a £240 million Net Zero Hydrogen Fund to support low-carbon hydrogen

production projects, with funds expected to be awarded by the end of 2022. This will

help the government meet its goal of installing up to 2GW of low-carbon hydrogen

production capacity by 2025, and up to 10GW by 2030 5 . Moreover, the Industrial

Decarbonisation and Hydrogen Revenue Support (IDHRS) initiative, which would fund

the allocation of hydrogen business model contracts to both electrolytic and CCUS-

enabled plants from 2023, was announced in the UK's Net Zero Strategy in 2021.

4British energy security strategy, 2022. Policy paper.

5The Net Zero Hydrogen Fund, 2022. Government response to consultation. UK Department for Business,
Energy & Industrial Strategy.

7
According to IDHRS, it would contribute up to £100 million in 2023 to award contracts

for the electrolytic hydrogen production capacity of up to 250MW6.

Furthermore, the Industrial Hydrogen Accelerator is a £26 million innovation

grant programme aimed at assisting the UK industry in embracing hydrogen as a clean,

inexpensive fuel source for industries such as manufacturing by showing hydrogen's

practicality and lowering the cost of switching energy systems. Lastly, the government

has set aside a further £5 million to help accelerate the development of carbon capture

and storage (CCS) technologies. CCS involves capturing, transferring, and storing

greenhouse gas emissions that would otherwise be released into the environment,

allowing for the storage and utilisation of traditional energy sources energy7.

On the other hand, the European Union's (EU) latest REPowerEU plan states the

aim of transforming industrial processes to replace gas, oil and coal with renewable

electricity and fossil-free hydrogen8. To further diversify the energy imports in the EU,

the document underlines the EU Energy Platform for the voluntary common purchase

of hydrogen. By merging hydrogen and renewable energy development and trade, the

EU also promises its international partners long-term opportunities for mutually

beneficial cooperation. By 2030, REPowerEU aims to produce 10 million tonnes of local

renewable hydrogen and import 10 million tonnes of renewable hydrogen. The plan also

announces additional investment of EUR 200 million for the Clean Hydrogen

Partnership through the Horizon Europe Programme8. To upgrade existing

infrastructure to achieve this ambitious progress in clean hydrogen is a challenge for all.

The total investment required for important hydrogen infrastructure categories is

expected to be between EUR 28 and 38 billion for EU-internal pipelines and EUR 6 to 11

billion for storage8.

Recent stakeholder consultation in the UK's hydrogen and energy sector outlines

some concerns regarding the business model of a hydrogen economy 9 . Even though

there are various ambitious supply targets for installing low-carbon hydrogen capacity

6 The Net Zero Hydrogen Fund, 2022. Government response to consultation. UK Department for Business,
Energy & Industrial Strategy.
7 GOV.UK, 2022. Press release. Government unveils investment for energy technologies of the future.

8 REPowerEU, 2022. The European Commission, A plan to rapidly reduce dependence on Russian fossil

fuels and fast forward the green transition.

9 BEIS, 2022. Government response to the consultation on a Low Carbon Hydrogen Business Model.
in the future, many respondents to the consultation emphasised the importance of taking

steps to boost hydrogen demand in order to reduce volume risk and encourage end-

users to transition to low-carbon hydrogen9. Another concern was whether hydrogen

usage and the hydrogen economy should be supported in all industries or whether

policymakers should prioritise hydrogen use where no feasible or readily available

alternative decarbonisation options exist9.

Production costs for low-carbon hydrogen generation are worth mentioning. In

2021, the UK Department for Business, Energy and Industrial Strategy (BEIS) compiled

the existing production methods and their current and future cost estimations, which

are presented in Table A110.

Table A1. Hydrogen Production Costs and Future Estimations, amended from

Hydrogen Production Costs Estimations10

Production method Definition Levelised Costs

Steam Methane Methane from natural gas is SMR (300MW)

Reforming (SMR) without pre-heated, mixed with steam 2020: £64/MWh

CCUS and usually with a catalyst to 2050: £130/MWh

produce H2, CO and CO2

Autothermal ATR is the process of ATR (300MW):

Reforming (ATR) or Steam producing syngas with H2 and 2020: £62/MWh

Methane CO by partially oxidising a 2050: £65/MWh

Reforming (SMR) hydrocarbon feed with O2 and SMR (300MW):

with CCUS steam and subsequent catalytic 2020: £59/MWh

reforming. 2050: £67/MWh

Grid electrolysis Using grid power to produce Polymer electrolyte

electrolytic H2 membrane electrolysis

(PEM) (10MW):

2020: £197/MWh

2050: £155/MWh

10 BEIS, 2021. Hydrogen Production Costs. UK Department for Business, Energy & Industrial Strategy.

9
 Renewable Using Renewable Energy PEM (10MW) (with

electrolysis Sources to produce electrolytic dedicated offshore

H2 wind):

2025: £112/MWh

2050: £71/MWh

Bioenergy with Biomass gasification BECCS (473MW)

carbon capture with CCUS 2030:

and storage £95/MWh (excl. carbon)

(BECCS) £41/MWh (incl. carbon)

2050:

£89/MWh (excl. carbon)

-£28/MWh (incl. carbon)

The total cost includes the following: CAPEX, Fixed OPEX, Variable OPEX, Electricity

cost, Fuel cost, CO2 transport and storage cost, and Carbon cost. As we can see from

Table A1, in many of the hydrogen production technologies, there is limited expected

reduction in costs, and in some cases increases in costs by the year 2050. The main reason

is the increased carbon cost estimation for the future, whereas with biomass a negative

carbon cost component yields a reduction in the estimations. The overall cost trend

estimation contrasts to the historical production costs of solar photovoltaic, wind power

and battery storage costs, which have fallen dramatically in recent years. For example,

Levelized cost of electricity (LCOE) of onshore wind and utility scale solar PV dropped

72 and 90% in nominal terms between 2009 and 202111. As Table A1 highlights, a similar

cost reduction trend for hydrogen is not expected in the future. This expectation is one

of the major limitations or concerns over the hydrogen economy and its future viability.

The cost of hydrogen and its market price is just one concern. There are also

reasonable doubts whether the ambitious supply targets are achievable due to logistics

issues such as electrolyser manufacturing. However, considering the existing supply-

driven nature of the hydrogen economy, there is also a non-trivial need to stimulate the

demand for hydrogen. On the other hand, approaching from a technology-neutral

perspective and keeping in mind that government support means taxpayers' money

11 Lazard, 2021. Levelized Cost of Energy, Levelized Cost of Storage, and Levelized Cost of Hydrogen.
being spent, we believe that the hydrogen applications should only be supported where

no viable or readily available low carbon alternative exists. Also, a need for support for

small-scale projects is advisable to stimulate own consumption and reduce

intermediaries.

One non-trivial question is, will carbon pricing impact the hydrogen uptake? The

UK Emissions Trading Scheme (ETS) covers some sectors such as energy-intensive

industries, the power generation sector and aviation. The UK ETS is a replacement

mechanism for the EU ETS. This scheme does not cover sectors such as transport,

agriculture, waste, certain industrial emissions, and the built environment for the time

being. However, the extension of UK ETS might be proposed in the future. This means

that carbon pricing will not affect all hydrogen economy applications for the time being.

An extension of ETS scope is vital for the impact of the carbon pricing on all hydrogen

businesses. We can observe from the existing regulatory and policy framework that there

will be public money support in the short term. The business cases should start

generating their own revenues in the long term. This brings us back to which hydrogen

use cases are self-sufficient and viable.

Finally, we should mention the standardisation of hydrogen types. Whilst the

UK prefers to use the term 'low carbon hydrogen' by adopting the threshold of

20gCO2e/MJ Lower Heating Value (LHV) through the proposed UK Low Carbon

Hydrogen Standard (LCHS), we should remind that the EU has not got a certification

mechanism for a 'clean hydrogen' or 'fossil-free hydrogen' standard yet. There are

various colour codes assigned to each hydrogen generation method. The most extensive

ones are green, blue and grey hydrogen. Green hydrogen is produced from the water

electrolysis process by using renewable electricity. This source might also be called

electrolytic hydrogen. The second one is blue hydrogen. This is sourced from traditional

fossil fuels such as natural gas. However, the emitted CO2 is captured and stored at the

site of production. This process is called carbon sequestration. Many companies also use

Carbon Capture, Utilisation and Storage (CCUS). However, to qualify as blue hydrogen,

carbon sequestration is sufficient. Finally, grey hydrogen is produced from fossil fuels

and commonly uses Autothermal Reformation (ATR) or Steam Methane Reforming

(SMR) methods. The emissions, however, are released into the atmosphere. Thus, grey

11
hydrogen is not classified as a green or renewable source. There is also numerous other

colour coding assigned to specific hydrogen production technique. However, since the

volume of these hydrogen is much lower than blue and green hydrogen, we omitted

these in this paper.

3. The Business Model and Viable Use Cases

Before inspecting which business opportunities may be viable for hydrogen, it is

important to first define how to assess its viability. To do that, we can begin by

explaining the innovation process. Figure 1 summarises this process from the inception

of the ideas to market penetration.

Figure 1. The Innovation Process12.

Phase 0, Envisage, begins with a search for real-world outcomes and the creation of a

vision. After that, we move on to the Discover phase. This phase identifies and outlines

the issues that are hindering the desired objectives. After that, the company should be

able to Enable the relevant skills and competencies to solve the difficulties described.

12 Küfeoğlu, S., 2022. Emerging Technologies: Value Creation for Sustainable Development. Springer Nature.
When the company's skills are sufficient, it can move on to the Develop phase. A product

or service prototype is created and tested at this phase. We go on to the Appraise phase

if the results are satisfactory. Assessing the innovation's impact and value is critical in

determining if the product/service will be scaled up for wider commercial use or remain

a prototype. If market conditions indicate that the business should be scaled up, it will

enter the market and reach a wider spectrum of consumers and customers. Funding and

financing channels are critical to fostering product/service development during this

entire process. Grants and loans may be a good place to start the process. As the trip

progresses to the Develop and Appraise phases, public and private investors will notice

the possibility and join in as Public-Private Partnerships or Venture Capitalists. As the

product/service matures, innovators may adjust, adapt, or update their Value Proposals,

Value Creation, and Value Capture, which will form the business models of the

innovations. In the business model inspection, we followed the traditional business

model theory and the basic three dimensions13:

Value Proposal: What the company offers as a product or service. (typically developed

during the Envisage / Discover Phases)

Value Creation: How the company creates and delivers these products or services.

(typically developed during the Develop / Appraise Phases)

Value Capture: What are the expected revenue sources, and how are they planning to

create this?

It is important to note that revenue or monetary value is not the only

consideration when discussing value. The demand for industry and enterprises to

combat climate change and achieve sustainability is increasing. As a result, to boost their

overall impact, acquire more finance, and achieve better market dispersion, the

innovations should also give environmental, social, and ethical value and impact. This

market diffusion and commercialisation of products and services is the part where we

define business opportunities as 'viable’. The value of the business opportunities is

captured in this phase. Our main purpose is to investigate the viability of these

13 Gassmann, O., Frankenberger, K. and Csik, M., 2013. The St. Gallen business model navigator.

13
opportunities worldwide. We recognise that the low-carbon hydrogen economy is at an

early stage, so we welcome feedback on how emerging technologies and business

models may impact our current assessment. We should also remind that exogenous

factors such as regulations, subsidies and carbon pricing will affect the viability of these

businesses substantially. Being a horizon scanning work, this paper only covers a broad

review of the business opportunities, thus leaving the detailed analyses of viable

businesses as a follow-up future work.

We should note that the boundaries between each of these phases (Appraisal,

Upscaling, Market Diffusion) are not precise whilst some businesses might span in

between two phases. The distinction could be made as follows. If a business has

numerous successful pilots/trials and some further evaluations are made in terms of

revealing a comprehensive economic, environmental and social impact and value, then

we can say that the business is in the Appraisal phase. When the business starts

generating revenue and is deployed in a wide range of geographies and markets, then

the business is in the Upscaling phase. In the Market Diffusion phase the business is

mature and reliable. The business should start generating revenue to be a self-sustaining

business. When we say self-sustaining business we mean that it will have a reliable

customer base, a continuous demand, and most importantly a steady stream of revenue.

The business should not be dependent on the external investments or the owners. In the

next chapter, we will attempt to map the 20 business cases according to these criteria.

4. Hydrogen Business Cases

This paper reviews the business models of 64 companies from 18 countries worldwide14.

Table D1 shows the locations of these countries. As we can see from Table D1, most

companies that we reviewed in this paper are located either in Europe or North America.

There could be two reasons for this. First, economic activity related to hydrogen is more

concentrated in North America and Europe. And second, due to a language barrier, we

could not reach sufficient number of sources from non-English speaking world.

All information presented in Table 1-Table 20 are publicly available and were adopted from official
14

websites of the companies. For reference, you may click on the hyperlinks on the company names.
 Table A2. Location of Reviewed Companies

Country number Country number

United States 14 South Korea 2

Germany 12 Spain 2
United Kingdom 9 Sweden 2
Canada 6 Switzerland 2
Netherlands 4 China 1
Japan 3 European Union 1
Australia 2 France 1
Italy 2 Luxembourg 1
Norway 2 Saudi Arabia 1

We conducted a market scan and picked up some leading players in their fields that do

business in the selected fields. This means that the selected companies are not the only

ones that are innovative or noteworthy. These are just representative examples. There

are 20 business opportunities that we listed here as some prominent direct and indirect

application areas in the hydrogen economy. We only listed business cases which reached

the Value Creation phase (Develop and Appraise) in the innovation process shown in

Figure 1. We deliberately excluded the use cases that are still in the Research and

Development phase. We attempted to cover a representative sample of key and leading

players in each sector. The companies are compiled from sources like the Hydrogen

report of the International Energy Agency (IEA)15, "Best Hydrogen Stocks to Watch in

2022"16, "10 Hydrogen Fuel Cell Stocks to Buy Today"17, "6 Green Hydrogen Stocks and

ETFs to Watch"18, "Top Hydrogen Start-ups"19, "14 hydrogen production and hydrogen

fuel cell stocks to watch"20, "130+ Tech Companies Developing Hydrogen-Based Clean

Energy Solutions"21, and especially for the downstream and end-use business cases, a

through a comprehensive market scanning.. However, we should stress that it does not

mean that the companies presented here are the only noteworthy ones since it is

15 IEA, 2021. Hydrogen, International Energy Agency, Paris.

16 Admiral Markets, 2022. Best Hydrogen Stocks to Watch in 2022.
17 Yahoo finance, 2022. 10 Hydrogen Fuel Cell Stocks to Buy Today.

18 US News, 2022. 6 Green Hydrogen Stocks and ETFs to Watch.

19 Venture Radar, 2022. Top Hydrogen Start-ups.

20 CMC markets, 2022. 14 hydrogen production and hydrogen fuel cell stocks to watch.

21 CB Insights, 2021. 130+ Tech Companies Developing Hydrogen-Based Clean Energy Solutions.

15
impossible to present all existing valuable companies and businesses in this paper.

Figure 2 summarises hydrogen business cases in the value chain.

Figure 2. The Hydrogen Value Chain and Business Cases

Here we should remind that some businesses, such as ammonia or methanol, can extend

more than one phase and be placed in multiple streams. The following sub-section

reviews 20 business cases and summarises their business models22.

4.1. Blue Hydrogen

Blue hydrogen is produced by steam methane reforming (SMR) combined with

subsequent carbon sequestration, where the emitted atmospheric CO2 is captured and

stored. Auto-thermal reforming (ATR) is another method to produce hydrogen from

natural gas, which has the benefit of producing a more concentrated stream of CO2. Both

technologies are commercially available and being used in many production sites

worldwide. Table 1 summarises a few specific examples to investigate the business

model and status.

22All information presented in Tables 1-20 are retrieved from official company websites. We did not
include any comments or information on these tables as we are in no position to justify the official claims
of the companies.
 Table 1. Summary of Blue Hydrogen Business Models
Company Value Proposal Value Creation Value Capture

(what?) (how?)

SHELL They offer blue SGP technology uses Revenue stream is

hydrogen combining a direct firing expected by the mass

Netherlands & UK their Gas Partial oxygen-based system sales of blue

Oxidation (SGP) and in a reactor with a hydrogen to

ADIP ULTRA refractory lining. It is decarbonise heavy

technologies. Over 30 a non-catalytic industry, transport,

licensees for gas and process that heating and power in

residue gasification produces high- the region of the

are now operating pressure steam from plant.

with SGP, and there waste heat rather They claim the SGP

are over 100 SGP than consuming it technology has 22%

gasifiers installed and emits no direct less levelized cost

worldwide. CO2. It also requires than ATR and much

little to no feed-gas less than SMR

pre-processing. technologies. They

ADIP ULTRA is a also claim CO2

non-corrosive, high removal is increased

carrying capacity by 25% - 30% thanks

solvent for capturing to the ADIP ULTRA

CO2 from high- technology.

pressure process The UK plant is

streams. expected to perform

Together with the capture of

UNIPER, the around 1.6 million

company is building tonnes of CO2 per

a blue hydrogen year through CCS.

production plant

with a capacity of up

to 720 megawatts in

the UK.

17
Johnson Matthey The company LCH technology They are targeting

promises to offer blue produced low- £200 million sales of

UK hydrogen at scale carbon hydrogen at all hydrogen

thanks to their LCH scale from natural technologies

technology. The gas while capturing including blue

technology is 98% of the CO2 hydrogen, green

incorporated at the emissions. The hydrogen and fuel

HyNet North West company claims to cells by the end of

hydrogen project in deliver blue 2024/2025. Once

the UK. hydrogen with lower operational, the

CAPEX and OPEX HyNet North West

with their LCH facility is expected to

technology. remove 600,000

tonnes of CO2 per

year.

TOYO Engineering The company is a They develop the Revenue stream is

prominent actor in the SMR technologies generated by the

Japan area of licensing, with high efficiency sales of SMR plants.

design and for producing crude The company’s

construction of SMR gas (syngas) products are widely

plants. Their products consisting of used in the world.

account for more than hydrogen and Extra value is

10% of the blue carbon monoxide captured by their

hydrogen produced in formed to produce steam reformers by

the world by SMR blue hydrogen. size reduction,

technique. Their Steam saving of fuel,

Reformers are used extension of tube life

in ammonia, and throughput

methanol, refinery increase.

hydrogen production

and fuel cell power

facilities.

Their reformers are

ideal for large

 facilities to make

production at scale.

Remarks: When combined with Carbon Capture Utilisation and Storage (CCUS), the

SMR process is commonly believed to capture over 90% of CO2 emissions. However, a

recent study suggests that blue hydrogen has serious Green House Gas (GHG) emissions

mainly due to fugitive methane23. The same paper claims that the total CO2 equivalent

emissions for blue hydrogen are just 9% - 12% less than for grey hydrogen23. On the other

hand, many companies claim that their hydrogen generation techniques reduce CAPEX

and/or OPEX with various designated percentage rates. However, since we are still at

the Value Creation and Appraisal phase of the blue hydrogen generation, we believe

these claims need to be verified by a wide-scale market use. In addition, the recent high

prices of natural gas in Europe and Asia pose additional challenges for the widespread

deployment of blue hydrogen. For example, recent analysis by ING Bank reports that

due to high natural gas prices, the hydrogen costs tripled in Europe 24 . Surely,

geographical differences play a crucial role in the hydrogen production and this

phenomenon needs further in-depth analysis.

4.2. Green Hydrogen

Renewable energy generation sources are rapidly increasing globally, and integration of

hydrogen production into this network will result in sector coupling of power systems

to other sectors such as heavy industry, transport, heating, and power to gas/”e-fuel”

solutions. Green hydrogen usually refers to the electrolysis of water using renewable

power generation, thus standing out as one of the clean or low-carbon energy carrier

options. Intermittency in renewable power generation is a problem, and green hydrogen

is a candidate to ease this challenge. As a result, the use of green hydrogen might enable

the potential for accelerating the decarbonisation of energy-intensive sectors. However,

according to the IEA’s report from 2019, converting all existing global grey hydrogen

generation to green hydrogen would require 3,600 TWh of renewable energy per year,

23 Howarth, R.W. and Jacobson, M.Z., 2021. How green is blue hydrogen? Energy Science & Engineering,
9(10), pp.1676-1687.
24 ING, 2021. High gas prices triple the cost of hydrogen production. Economic and Financial Analysis.

19
which was about the EU’s entire annual electricity production25. In some cases, green

hydrogen also refers to other forms of renewable hydrogen, not necessarily involving

electrolysis. Table 2 compiles some business cases to closely examine the range of

possibilities and business models.

Table 2. Summary of Green Hydrogen Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Siemens Siemens Gamesa and They are testing a Revenue stream is

Siemens Energy have modular approach to expected from the

Germany started joint work to see the hydrogen generation of green

produce green production hydrogen.

hydrogen at an performance at Over the next five

offshore wind turbine. variable renewable years, Siemens

Siemens Gamesa also generation rates. Gamesa and Siemens

trials a land wind Also, electrolyser Energy plan to invest

turbine-fed performance under around €120 million

electrolyser system for harsh weather in the development

on-grid and off-grid conditions is of modular offshore

hydrogen generation. monitored. The trials wind-to-hydrogen

aim to demonstrate systems, with a full-

the viability of scale offshore

dependable, efficient demonstration

deployment of anticipated by 2025

modular offshore or 2026.

wind-to-hydrogen

systems and act as a

test bed for making

large-scale, cost-

effective hydrogen

generation a reality.

25 IEA, 2019. The Future of Hydrogen.

REPSOL Together with Enagas In the typical Expected revenue

they are planning to electrolyser-based stream through the

Spain offer green hydrogen generation, sales of green

produced from the electricity is hydrogen.

direct use of solar generated at PV- The extra value will

energy, a process they panels and then fed be created via

name photo to the electrolyser to increased efficiency

electrocatalysis. separate oxygen thanks to their photo

This solar-fed from hydrogen. electrocatalysis

hydrogen generation Their technology process. They plan to

technology does not receives solar invest around €2.549

deploy electrolysers. radiation and billion by 2030.

generates electrical The company expects

charges that cause this business to be

the separation by viable by 2030.

using its photoactive

material.

They aim to reach 1.9

GW of installed

capacity by 2030.

Hydrospider They offer Their first green Targeted customers

procurement, hydrogen are heavy

Switzerland production and demonstration commercial vehicles.

logistics of green project produces 300 The sales of green

hydrogen, mainly tonnes of hydrogen hydrogen generate

produced from per year at a revenue.

hydropower. They hydropower plant Their existing

also provide with a 2-MW production capacity

marketing and sales electrolyser. can supply up to 40-

support to producers The hydrogen is 50 trucks a year.

of verifiable green transported to filling The decarbonisation

hydrogen. stations after being of the transport

stored in custom- sector captures

made containers. environmental value.

21
 SGH2 They offer the The company utilises Revenue stream

production of green a plasma-enhanced through sales of

U.S. hydrogen from any thermal catalytic waste-based green

sort of waste ranging conversion process hydrogen produced

from paper to plastics, optimised with from plasma

tires to textiles. oxygen-enriched gas. technology.

At high Mass production

temperatures, the promises economy of

waste feedstock scale with a cost of

disintegrates into its US$2 per kg. This has

molecular parity with the

compounds. These cheapest brow

molecules bind into hydrogen production

very high-quality in India. Whereas

hydrogen-rich electrolytic hydrogen

biosyngas, which are generation roughly

then used to produce costs US$10-15 per

hydrogen. They are kg in the U.S.

launching a

generation plant in

California to produce

3800 tonnes of waste-

based green

hydrogen per year.

This is the largest

green hydrogen

facility to be built in

the world so far.

Remarks: A key challenge for green hydrogen is to reduce costs and increase scale.

Scaling up electrolyser production and producing sufficient low-cost renewable power

in excess of that required to decarbonise the electricity grid is particularly challenging.

Alternatives to electrolysis, such as plasma or photo electrocatalysis, as summarised in

Table 2, may prove to be value-adding. The production costs and environmental

footprint vary depending on the input energy, production technology and the location

of production plants. Various pilot and demonstration projects are being implemented

globally. Even though green hydrogen could be regarded as an effective tool for

decarbonising hard-to-abate sectors such as heavy transport, shipping, steel and cement,

a requirement for mass production and an economy of scale is a must. The business is

still in its Appraise phase, but as the amount of investment is booming, depending on

strong demand, in a few years it might enter Upscaling before reaching the Market

Diffusion.

4.3. Catalysts

Catalysts reduce the energy required to start a chemical process, speeding it up. Many

industrial processes rely on chemical reactions to transform raw materials into usable

products, and catalysts are the backbone of many of them26. In the hydrogen ecosystem,

catalysts are used in a wide range of applications, including hydrogenation, electrolysers,

fuel cells, hydrocracking, and hydrogen production. Table 3 briefs a few business cases

related to the catalyst industry.

Table 3. Summary of Catalysts Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Sigma-Aldrich They provide Iridium, nickel, Revenue stream

(Merck) homogeneous and palladium, platinum, through bulk sales of

heterogeneous rhodium, or catalysts. A large

Germany & U.S. catalysts for sectors ruthenium are supply-chain

such as common promises global

pharmaceuticals, hydrogenation availability.

agrochemicals, catalysts used to Furthermore, in

industrial chemicals, initiate the chemical addition to their

or custom reaction between product portfolio,

manufacturing. hydrogen and they offer custom

26 Lerner, L. 2011. 7 things you may not know about catalysis. Argonne National Laboratory.

23
 another substance. catalyst synthesis

Heterogeneous depending on the

catalysts are customers’ request.

deployed to enable

faster selective and

large-scale

production. The

reactivity can be

altered by adjusting

the carbon's structure

and metal content,

which increases the

range of possible

applications.

Homogeneous

catalysts deliver a

more selective and

characterizable

process, leading the

mechanisms to be

rationally

manipulated for

alternative outcomes.

Heraeus The company offers They are delivering Revenue by sales of

chemical process electrocatalysts for catalysts. Further

Germany catalysts with a wide PEM electrolysers value is captured by

spectrum of and PEM fuel cells. providing customers

homogeneous and They provide with up to three

heterogeneous customers with a times higher catalyst

catalysts. complete loop of performance while

their precious metal reducing the

needs by recovering precious metal

precious metals from loading in the

a catalyst-coated catalyst-coated
 membrane. They use membrane by 50–

platinum in different 90% in comparison

PEM fuel cell to other products in

catalysts, increasing the market.

performance and Thus, the company

reducing costs. Their promises more

catalysts have cell efficient use of

reversal tolerance iridium, allowing

which protects the increasing

anode by allowing performance

significantly lower and reducing costs,

damage throughout large scale

time. application due to

savings in

precious metal

content, and a

substantial decrease

in

capital expenditure

due to iridium and

catalyst material

savings.

Honeywell They offer Proton They develop, Revenue stream

Exchange Membrane manufacture and though sales of

U.S. (PEM) and Anion deliver membranes catalysts for a wide

Exchange Membrane and catalysts for gas range of

(AEM) electrolysers. processing, refining, applications.

They are also piloting steel, petrochemical Further value is

a new catalyst-coated industries, and aimed to be captured

membrane (CCMs) battery and power by achieving a 25%

technology to achieve applications. reduction in

substantial cost In collaboration with electrolyser stack

reduction. ZoneFlow Reactor cost and further

Technologies, they significant efficiency

25
 are in the process of increases in catalyst

commercialising a design.

new technology

called ZoneFlow

Reactor.

It is a structured

catalyst module that

replaces conventional

catalyst pellets in

steam methane

reforming (SMR)

tubes providing

better heat transfer

and pressure drop

performance.

Remarks: Catalysts are essential tools in producing electrolytic hydrogen. The ambitious

green hydrogen capacity installation targets necessitate the large-scale use of catalysts.

The design of catalysts can vastly improve the efficiency of the green hydrogen

production process. A radical increase in catalyst efficiency will vastly impact the cost

of hydrogen production. Recent research suggests that the amorphous iridium

hydroxide-based catalyst design exhibited efficiency 150 times that of its original

perovskite structure. It also yielded an efficiency of almost three orders of magnitude

better than the common commercial iridium oxide-based catalyst 27 (Oregon State

University, 2021). However, we should wait and see whether similar R&D activities will

translate into commercial products or not. Another concern not just related to catalysts

but to overall hydrogen applications is the use of rare materials. There are some concerns

regarding the availability of certain materials such as aluminium, copper, nickel, and

zinc, platinum, iridium upon an ambitious uptake of hydrogen production and storage

capacity in the future. A recent report published by the World Bank reassures that Most

of the commodities involved in the production and use of clean hydrogen will not face

27Oregon State University, 2021. Oregon State researchers develop advanced catalysts for clean hydrogen
production.
significant market issues due to the overall volume of material demand28. Nonetheless,

the same report stresses that especially platinum and iridium supplies might be a

challenge for the industry in the coming years28. Catalyst manufacturing is an old and

mature business. It has market-proven products such as various homogeneous and

heterogeneous catalysts. In addition, there is a vivid activity on the Value Creation side

with some ambitious efficiency increase targets. So, the business is mature and spans

from Value Creation to Market Diffusion.

4.4. Electrolysers

Electrolysers are devices that are used to decompose water molecules into hydrogen and

oxygen through the electrolysis process. These come in various sizes, from small-sized

ones suitable for compact appliances in hydrogen distribution, such as small industrial

plants installed in shipping containers to massive central production plants connected

directly to large-scale renewable energy sources. While some electrolyser customers

favour large units (from 1MW and beyond), some place more emphasis on quantity than

size by opting in modular residential and commercial designs (from 1 kW to 100 kW).

For example, from the customer perspective, operators of large PV plants will find the

first strategy appealing, whereas those of small systems will benefit more from the

latter29. There are different electrolyser designs available commercially. Also, various

designs are in the Research & Development and Piloting phases, waiting to be scaled up

in the market. Alkaline Electrolysers and Proton Exchange Membrane (PEM)

Electrolysers are widely used in the industry. Anion Exchange Membrane and Solid

Oxide electrolysers are in the Develop and Appraise phase. Table 4 summarises a few

examples illustrating the range of products and potential business models.

28 World Bank Group, 2022. Sufficiency, sustainability, and circularity of critical materials for clean hydrogen.
Susana Moreira, Tim Laing.
29 PV Magazine, 2020. Electrolyzer overview: Lowering the cost of hydrogen and distributing its

production.

27
 Table 4. Summary of Electrolysers Business Models
Company Value Proposal Value Creation Value Capture

(what?) (how?)

Ostermeier They offer modular The electrolysis Revenue stream

H2ydrogen electrolysers in 1.2m X consists of the through sales of the

Solutions 1m X 2m sizes for electrolysis frame modular design of

residential and module, the electrolysers. They

Germany commercial use. The electrolysis module, are planning to

available nominal the water produce about 10

power of the purification electrolysers in 2022

electrolyser stacks is 1 module, the and 20 more in 2023.

kW, 2 kW, 3 kW electrolysis power The water

or 5 kW. module, the fuel cell purification system

and the cooling inside the module

module. Thanks to adds further value to

the water the product, as tap

purification module, water could be used

tap water can be in hydrogen

used in hydrogen generation.

generation at homes

and commercial

facilities. The

produced hydrogen

can then be stored in

the fuel cell module

to be converted to

power whenever

needed.

Next Hydrogen The company In their portfolio, Revenue is generated

provides scalable they have three pre- by the sales of

Canada Alkaline electrolyser assembled product alkaline electrolysers.

cell design to generate types and ready to Further value is

electrolytic hydrogen drop in at customers’ aimed by installing

at MW scales. sites. MW systems and

 They have four significant economies

demonstrations of scale to drive

planned which down the cost of

include three with electrolytic

Canadian Tire and a hydrogen.

proof of concept with They also provide

Hyundai and Kia. utility-scale

They claim that their dispatchable loads

electrolysers can and hydrogen for

capture the entire energy storage.

intermittent power

generation output

range.

The company is also

working on PEM

electrolysers.

Nel Hydrogen The company is an Their electrolysers Revenue is generated

actor in the design, could be scaled to by the sales of a wide

Norway manufacturing, and match numerous range of electrolyser

sales of Alkaline and applications. portfolios. On-site

PEM electrolysers. Atmospheric renewable generation

They have more than Alkaline Electrolyser eliminates hydrogen

3,500 electrolysers is claimed to be the delivery and storage.

installed and world’s most energy- The product range

operating globally. efficient electrolyser addresses the needs

featuring a cell stack of different types of

power consumption customers. The

as low as 3.8 company is running

kWh/Nm3 and up to a mature electrolyser

2.2 MW of hydrogen business.

gas produced.

Depending on the

module size, it can

produce up-to 8

29
 tonnes of hydrogen

per day.

Enapter The company offers AEM electrolysers AEM electrolysers

Anion Exchange utilise a are yet to be

Italy Membrane (AEM) semipermeable commercialised.

electrolysers and an membrane designed Their value comes

energy management to conduct anions. from being built with

software system, Steel can be utilised relatively less costly

especially for for the bipolar plates materials and being

laboratories, power instead of titanium safer to handle when

backup solutions and because the compared to other

residential storage atmosphere is less types of electrolysers.

units. corrosive.

Additionally, AEM

electrolysers may

operate with less

pure water, which

minimises the

complexity of the

input water system

and enables the use

of filtered tap and

rainwater.

Remarks: Electrolysers can be deployed commercially in a variety of applications. The

expense of the materials needed to achieve a long-life span and satisfactory performance

remains a major obstacle to the mass commercialisation of PEM electrolysers. On the

other hand, Alkaline electrolysers have been available and widely used at reasonable

prices. A recent study by the Fraunhofer Institute suggests that the price of the 100MW

alkaline electrolyser might decrease from €663/kW in 2020 to €444/kW in 2030, whereas

the PEM electrolyser price of the 5MW system should decrease from €949 to €726 per
kW in the same time period30. Nonetheless, when used with intermittent energy sources,

because of their poor response times to a changing power supply, it is challenging and

expensive to combine alkaline electrolysers with renewable energy sources effectively.

Developers of alkaline electrolysers are working to improve this (see, for example, Next

Hydrogen above). The EU has an installed electrolyser capacity target of 80 GW, and the

UK aims to have 10 GW by 2030. As of 2021, Europe has a 1.75 GW capacity for

electrolyser manufacturing and the European electrolyser manufacturers committed to

a tenfold increase of their capacity to manufacture electrolysers to 17.5 GW by 202531.

Recent IEA report highlights that according to business announcements, the global

capacity for producing electrolysers is expected to increase tenfold to more than 100 GW

annually by 203032. However, the final investment decision has yet been made for only

8% of the announced expansion of the electrolyser manufacturing capacity. The IEA also

emphasises the possibility of regional electrolyser manufacturing concentration, which

could potentially result in supply chain disruptions32. Delivering these ambitious targets

seems quite a big challenge when supply chain logistics are considered. The use of

expensive materials in PEM electrolysers, poor performance of Alkaline electrolysers

with intermittent sources, and the lack of commercialisation of Anion Exchange

Membrane and Solid Oxide electrolysers increase this challenge to considerable levels.

Overall, this is an old and mature business, and spans from Value Creation to Market

Diffusion.

4.5. Ammonia Production

Ammonia is a critical substance in fertiliser production and, second only to sulphuric

acid, is one of the world's most produced chemicals 33 . It is produced by combining

hydrogen and nitrogen in the Haber-Bosch process with a catalyst at high temperatures

and pressure. 237 million tonnes of ammonia were produced globally in 2021 34 . The

30 Holst, M., Aschbrenner, S., Smolinka, T., Voglstätter, C. and Grimm, G., 2021. Cost Forecast for Low-
Temperature Electrolysis-Technology Driven Bottom-Up Prognosis for PEM and Alkaline Water
Electrolysis Systems. A Cost Analysis Study on Behalf of Clean Air Task Force.
31 European Electrolyser Summit, 2022. Europe Clean Hydrogen Alliance, Joint Declaration. Brussels.

32 Energy Technology Perspectives, 2020. IEA Iron and Steel Technology Roadmap.

33 Feng, X., 2018. A sustainable, energy-saving way to make the key ingredient in fertilisers.

34
Statista, 2021a. Production capacity of ammonia worldwide from 2018 to 2021, with a forecast for
2026 and 2030.

31
majority of this production is done with the SMR technique 35 . Ammonia is used in

various sectors such as animal nutrition, automotive, cosmetics, electronics, healthcare,

household goods nutrition, explosives, textile, plastics & resins. In the context of

decarbonisation, ammonia is expected to have a significant role as an energy carrier or

for energy storage. Ammonia is now the largest hydrogen consumer, accounting for

around 45% of the world's hydrogen offtake36. Nearly all ammonia production today

uses grey hydrogen, emitting around 500 million tonnes of CO2, equal to nearly 2% of

global emissions. Table 5 presents the summary of the business models of some key

players in the ammonia production business.

Table 5. Summary of Ammonia Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Casale The company licences They deliver Revenue stream

technology designs ammonia production though sales of

Switzerland and constructs plants of various ammonia plant

ammonia production sizes. Natural gas is facilities, ammonia,

plants, as well as first de-sulphurised and capacity

increasing capacity at on a typical blue increases.

the existing plants or ammonia plant and Further value is

switching from grey to then fed into a steam captured by

blue or green reformer. After CO2 promising longer

ammonia and green removal, any operating life

methanol. remaining carbon in comparison with

They offer simple oxides are converted traditional designs.

plant construction, back to methane by Their products have

operation and reaction with a low minimum turn-

maintenance. hydrogen. The final down ratio;

synthesis gas is stable operation is

cooled and fed to the possible even at 20%

35
Royal Society, 2020. Ammonia: zero-carbon fertiliser, fuel and energy store, Policy Briefing.
36Hydrogen Insights, 2021. A perspective on hydrogen investment, market development and cost
competitiveness. Hydrogen Council, McKinsey & Company.
 Modular construction ammonia synthesis of the design load.

is available for remote section. Increased efficiency

locations. Through revamping, is achieved by the

they deliver 100% utilisation of 100% of

super capacity and the catalyst volume

30% moderate for reaction.

capacity increases at Environmental value

existing ammonia is captured by

production plants. reduced NOX

emissions below the

limit

specified by the

European Union for

new plants

(140 mg/Nm3,

calculated at 3%

oxygen excess).

KBR They offer plants to The company offers Revenue stream

produce ammonia and both green ammonia through the sales of

U.S. fertilisers from various with K-Green green and blue

sources. Also, nitric technology and blue ammonia and

acid, ammonium ammonia with the hydrogen generation

nitrate, and urea PurifierPlus process. plants. Their Purifier

ammonium nitrate They also deliver a technology captures

production portfolio of extra monetary value

technologies are hydrogen generated by reducing

provided. from natural gas, operational and

heavy naphtha and capital expenditures.

other feedstocks Further reduction in

through their SMR, expenses due to their

reforming exchanger joint ammonia and

system, and methanol production

aerothermal with Johnson

reformer. Their Matthey when

33
 ammonia can be compared to separate

used directly in fuel productions.

cells and internal Increased supply

combustion engines. security and

efficiency and

flexible operation are

supplementary

values.

Environmental value

is captured by

reduced CO2 and

NOX emissions.

When compared to

the typical SMR

method, the total

amount of CO2

produced per ton of

NH3 is reduced by

around 15%.

Stamicarbon A green ammonia They deliver Revenue is generated

producer. They modular designs through the sales of

Netherlands provide technical depending on the green ammonia

licences and customers' plants and increased

engineering specifications. In capacities.

specifications for the particular, small- The extra revenue is

construction of scale green ammonia created by selling

compact Green plants are delivered. software for operator

Ammonia plants with Their products can training simulators

predetermined be used as a via Stami Digital.

capacity. They also renewable feedstock Further value is

offer help to for fertiliser plants to captured by saving

customers with project manufacture the energy and

planning, finance, and necessary nitrogen producing safely and

feasibility studies in fertilisers by using cost-effectively

 green ammonia renewable energy through reduced

production. sources like solar CAPEX.

and wind. Environmental value

is captured by

reducing waste and

emissions.

YARA They are the world's The hydrogen is Revenue stream

leading ammonia produced via SMR. through mass sales of

Norway producer. They can With over 200 ammonia thanks to

transport ammonia terminals and an extensive logistics

via sea, road, or rail. warehouses around network.

They supply ammonia the world, they can Environmental value

in both compressed ship and deliver is captured by the

liquid and cryogenic more than 20 million abatement of

forms. They tons of chemical nitrogen oxides

particularly excelled nitrogen products (NOx) and hydrogen

in logistics, shipping, and nitrates a year. sulphide (H2S),

and storage of They have a fleet of reducing SOx

ammonia. 11 ammonia carriers emissions in the

and 18 marine maritime sector.

ammonia terminals

with 580 kilotons of

storage capacity

Together with

ENGIE, they will

install a PV-powered

green ammonia plant

with battery back-up

with a 10 MW

electrolyser.

Together with JERA,

they plan to supply

blue and green

ammonia and

35
 optimise logistics to

Japan.

Remarks: Ammonia fits in both the midstream and downstream sectors. The number of

market players and their installed capacities is increasing steadily. However, especially

for green ammonia, an economy of scale is needed to reduce capital expenditure

(CAPEX). According to an IEA estimation in the Sustainable Development Scenario,

ammonia demand will grow by 25% by 205037. According to this report, both blue and

green ammonia production amounts are negligible when compared to grey ammonia37.

Traditional (grey) ammonia is a mature business in the market diffusion phase. Blue and

green ammonia are still in the Value Creation phase (Appraisal), with numerous pilot

projects going on or newly introduced. For the midstream, ammonia steps forth as one

of the viable options in delivering and shipping low-carbon fuels.

4.6. Hydrogen Blending with Natural Gas

There is growing pressure on natural gas companies to decrease their carbon footprint

and greenhouse gas emissions (GHG). At this point, some consider hydrogen blending

into natural gas pipelines an option, as burning hydrogen emits no GHG emissions. Of

course, this hydrogen must be clean or low-carbon, so the carbon footprint will go down.

Various pilot projects and trials worldwide test this hydrogen blending into the existing

natural gas infrastructure. There have been at least 26 hydrogen blending projects in the

United States since 2020 38 . The country has 1,600 miles (~2,600 km) of dedicated

hydrogen pipelines and a vast natural gas network 39 . To compare with the existing

natural gas infrastructure, we should remember that the U.S. has nearly 500,000 km of

natural gas pipelines40. Nonetheless, there are serious concerns regarding this potential

business model. At what percentage of hydrogen should be blended with natural gas is

still debatable. A study by Energy Innovation states that Due to the chemical differences

37 Ammonia Technology Roadmap, 2021. IEA Towards more sustainable nitrogen fertiliser production.
38 S&P Global, 2022. Market Intelligence, US hydrogen pilot projects build up as gas utilities seek low-
carbon future.
39 Hydrogen and Fuel Cell Technologies Office, 2021. HyBlend: Opportunities for Hydrogen Blending in

Natural Gas Pipelines, U.S. Department of Energy.

40 Offshore Technology, 2019. North America has the highest oil and gas pipeline length globally.
between hydrogen and methane, using hydrogen in buildings poses significant

difficulties and safety issues throughout the current natural gas infrastructure system41.

For example, an NREL study suggests that less than 5 to 15% of the volume of the gas

blend can be hydrogen, which is practical and allows for the storage and delivery of

renewable energy without considerably raising the risks of using the gas blend in end-

use equipment like homes appliances42. At the same time, Energy Innovation states the

same safety margin as 5 to 20%41. Existing demonstrations and deployments range from

1 to 30%39. In the UK, the HyDeploy project has demonstrated up to 20% of blends being

distributed to a small number of domestic consumers 43. National Grid’s Future Grid

project investigates the potential of various blend levels in the national transmission

system44. However, blending less hydrogen into the gas network will raise doubts about

the reduction of carbon footprint. Even a 20% blend by volume is only around 7% by

energy content, so it has a limited decarbonisation impact. Table 6 presents some of the

key players and their business models.

Table 6. Summary of Hydrogen Blending Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Enbridge They offer a utility- The first trial started Potential revenue is

scale Power-to-Gas with injecting 2% of expected from green

Canada (P2G) service which is hydrogen volume hydrogen sales.

capable of producing into the gas network Environmental value

nearly 400,000 kg to feed about 3,600 is captured by

hydrogen per day. customers. This pilot emissions reduction.

They also run two produces about The first pilot yielded

green hydrogen 18,000 kg of an abatement of 117

blending trials in hydrogen per year. tonnes of CO2

Canada.

41 Baldwin, S., Esposito, D., and Tallackson, H., 2022. Assessing The Viability of Hydrogen Proposals:
Considerations for State Utility Regulators and Policymakers, Energy Innovation, San Francisco.
42 Melaina, M. W., Antonia, O., and Penev, M. 2013. Blending Hydrogen into Natural Gas Pipeline Networks:

A Review of Key Issues. National Renewable Energy Laboratory (NREL), Colorado.

43 HyDeploy, 2022.

44 Future Grid, 2022. National Grid.

37
 The second trial aims equivalent from the

to install a 20-MW atmosphere.

electrolyser plant to

feed green hydrogen

through a dedicated

15 km pipeline to

connect this facility

to the main gas

network. They aim to

inject up to 15% of

hydrogen volume

based on ongoing

engineering

assessment

outcomes.

HyBlend An initiative by the The conditions on Potential revenue

U.S. Department of how the blending stream through sales

U.S. Energy to research limits will be decided of low-carbon

and test hydrogen will depend on the hydrogen through

blending in natural design and condition the natural gas

gas pipelines. of the existing network.

They are working on pipeline Environmental value

research and materials (e.g., is captured by

development for integrity, decreasing GHG

materials dimensions, emissions.

compatibility, techno- materials of Further value is

economic, and construction), as well aimed at increasing

environmental life as the design and supply security.

cycle analysis. condition of pipeline

infrastructure

equipment (such as

compressor stations)

and applications that

use natural gas (e.g.,

 building appliances,

turbines, and

chemical processes,

such as plastics

production).

The aim is to develop

tools for risk

analysis,

opportunities and

cost analysis, and life

cycle and pollutant

emissions analysis.

National Grid A theoretical Hydrogen blending Potential revenue

exploration and a pilot in heating and stream by using low-

UK & U.S. project, HyGrid, aims transportation is carbon hydrogen in

to decarbonise the gas trialled. the national gas

network in Long UK trials are network, increased

Island to heat around exploring injections hydrogen storage.

800 homes and fuel of 2, 5 and 20% Further value is

ten municipal vehicles between two proposed by

by blending green terminals. delivering a

hydrogen into the They also trial hydrogen mix for

distribution system. deblending as certain fuel-sensitive

Further trials in the customers might ask customers that

UK. for deblending as require specific gas

they only use natural mixtures with a

gas and inject the certain ratio.

remaining hydrogen Environmental value

back into the through

network. decarbonisation and

emissions reduction.

SNAM An energy company Using the existing The revenue stream

that trialled a 5% infrastructure, they is expected by selling

Italy volume of hydrogen are working on the hydrogen to a wide

39
 blending into its standardisation and range of customers

existing gas network compatibility of (from industry to

to feed two industrial injecting hydrogen transport).

customers in Italy for into their gas They aim to create

about a month in 2019. network. Two additional value by

They replicated the successful trials with employing their

same trial with 10% of 5 and 10% of volume existing hydrogen

volume again later in injection have been storage, transport

2019. followed by the and distribution

replacement and infrastructure.

development of Environmental value

assets to standards is to be captured by

which are compatible deep

with hydrogen. decarbonisation.

Remarks: Among the most challenging subjects regarding net-zero targets of 2050 are

the heating and transport sectors. Hydrogen blending could be one of the remedies for

the decarbonisation of these sectors as it is regarded as a means of transport or

transmission asset for the hydrogen economy. Numerous trials have been going on

worldwide with varying volumes of hydrogen mixing in the existing gas network,

typically from 1 to 20%. Nevertheless, these are all pilot projects with concerns over the

compatibility of the existing gas infrastructure for injecting large portions of hydrogen

volumes. Moreover, the revenue and value captures are also debatable. Due to these

discussions, worldwide upscaling of the hydrogen blending business is not visible.

4.7. Hydrogen Energy Storage

Hydrogen is an intermediary in energy systems, and storage is vital. Hydrogen can be

stored in compressed gaseous, liquid, or metal hydride forms. Hydrogen storage can

also be classified according to its size (small-scale and large-scale storage). Even though

the threshold is not clear, large-scale hydrogen storage can be expected to be from tens

to thousands of tonnes. Small-scale hydrogen can be stored in pressurised vessels, solid

metal hydrides, or nanotubes with a high density. On the other hand, metal hydrides,
chemical hydrides, liquid organic hydrogen carriers, adsorption, liquification, and

compression can store hydrogen in large quantities45. Furthermore, underground salt

caverns offer extra large-scale storage possibilities. Achieving economically viable large-

scale hydrogen storage is crucially important for the success of the hydrogen economy,

as storage will be an integral part of the future hydrogen infrastructure. In Table 7, we

reviewed various companies to examine the range of approaches and business models.

Table 7. Summary of Hydrogen Energy Storage Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

GKN Hydrogen The company offers Their metal hydride Revenue through

decentralised and storage systems sales of a range of

Germany small-scale metal operate at low modular storage

hydride hydrogen temperatures and units. Further value

storage systems to be low pressures. The is captured by the

used for a long period modular products software

of time. can be deployed as management tool.

Their storage backup systems, Environmental value

capacities range from seasonal storage and is generated by using

10 kg to 250 kg. in 100% recyclable

commercial metals in the

buildings, production, emitting

microgrids, and only water during

maritime transport. the operation and

They also provide lasting for decades

digital management without any losses.

software for users to They claim that their

remotely monitor storage unit has 99%

and control the capacity after 3,500

operations. cycles.

45Andersson, J. and Grönkvist, S., 2019. Large-scale storage of hydrogen. International journal of hydrogen
energy, 44(23), pp.11901-11919.

41
Linde They provide To get the same The cryogenic tank

vacuum-insulated amount of energy, technology is old and

Germany cryogenic tanks to four or five times less mature. It provides

store liquid hydrogen room is needed for safe and efficient

from 3,000 to 100,000 liquid hydrogen than storage of liquid

litres (or 200 to 7000 for compressed hydrogen.

kg). gaseous hydrogen. This liquid hydrogen

Therefore, storing could be used in

this gas in liquid many applications.

form in the tanks has For example,

benefits in terms of combined with fuel

space and efficiency. cells, it can be the

Horizontal and fuel in the maritime

vertical designs are sector.

available. The

containers come with

active cooling

systems.

Steelhead The company offers Hydrogen Cube and The revenue stream

Composites aluminium or Hydrogen CubePlus is generated in three

polymeric pressure gas storage systems ways:

U.S. vessels with capacities can be deployed for i) Distributed grid

from 6 litres to 270 medium and large- model, where the

litres to store scale purposes. company bills

compressed gaseous A modular design is customers at a per

hydrogen with possible by kWh rate for

pressure options connecting multiple electricity used and

ranging from 350, 500, pressure vessels to owns the cubes and

and 700 bar. For customers’ fuel cells.

example, a modular 90 preferences. ii) Module

litre vessel can store 2 These are swappable replacement model,

kg of compressed modules meaning where the company

hydrogen. that whenever bills customers per

empty, new pressure kg of hydrogen used

 vessels can be and owns the cubes,

connected easily. and customers buy

This promises a fuel cells.

continuity of supply. iii) Customer-owned

Empty cubes are model, where the

returned for refilling. company bills

The company claims customers at a fixed

pressure vessels are cost for swapping

cheaper and lighter cubes with filled

options when cubes and customers’

compared with own cubes and fuel

batteries to supply cells.

the same amount of

energy.

Remarks: Hydrogen storage is a key enabler for the hydrogen economy and has received

relatively little attention in the recent drive to scale up hydrogen production. The

economic viability of gaseous, liquid and metal hydride storage systems are still

debatable. Quite a few companies offer commercial products, especially in small-scale

storage, but large-scale storage, most likely in underground salt caverns will need to be

developed. Research and development and piloting activities continue for further

technologies such as nanotubes. Chemical hydrides, such as ammonia and methanol,

enable high-density hydrogen storage in large quantities. We should also mention that

hydrogen can be stored on a large scale in underground salt caverns. Salt caverns are

commonly used for natural gas storage, and there are proposals to store hydrogen as

well. Underground hydrogen storage is at its early stages of development and in-depth

and comprehensive work is needed to address the challenges46. Linde is operating one

commercial salt cavern hydrogen storage in Texas, United States 47 . SABIC 48 operates

46 Muhammed, N.S., Haq, B., Al Shehri, D., Al-Ahmed, A., Rahman, M.M. and Zaman, E., 2022. A review on
underground hydrogen storage: Insight into geological sites, influencing factors and future outlook. Energy
Reports, 8, pp.461-499.
47 Linde, 2022. Storing Hydrogen in Underground Salt Caverns.

48 DNV, 2021. Initial Hydrogen Strategy Report. Northern Gas Networks (lead partner), Wales & West

Utilities and National Grid Gas Transmission, Leeds, UK.

43
three salt cavern hydrogen storages in the Teesside, UK, where each cavern has a

capacity of 70,000 m³. There are numerous similar projects introduced or suggested

worldwide. However, these trials have not reached the Appraise phase. The success of

the hydrogen economy is dependent on the upscaling of the storage business. Obviously,

a demand push is necessary to pass through this phase and reach market diffusion.

4.8. Methanol Production

Methanol is a type of alcohol utilised in various applications, such as in fuels, paints,

cosmetics and plastics. It is a trending renewable energy resource piloted and

commercially used in the power, automotive, and maritime industries. Methanol can be

produced by using natural gas, coal, and renewables such as municipal waste, biomass,

and recovered carbon dioxide. It is regarded as a viable option as an energy carrier for

distribution, transmission, and storage assets in the wider hydrogen economy. Some

might even suggest a methanol economy as an alternative to the hydrogen economy49.

Conventional methanol production and sales is an old and mature business that has

reached market diffusion already. About 40-45% of global methanol production is now

used in the energy sector50. Renewable methanol, often known as bio-methanol, is an

ultra-low carbon chemical made from sustainable biomass or recycled (or waste) CO2

and H2 from electricity. Table 8 compiles a few leading players and business cases to

investigate the potential business model.

Table 8. Summary of Methanol Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Methanex They are the largest The process of Revenue is generated

methanol producer in reforming natural by the mass sales of

Canada the world. They have gas with steam and methanol on a global

production facilities converting and scale thanks to the

in Canada, Chile, distilling the vast and reliable

49 Sonthalia, A., Kumar, N., Tomar, M., 2021. Moving ahead from hydrogen to methanol economy: scope
and challenges. Clean Techn Environ Policy.
50 Methanol Institute, 2022. The methanol industry.
 Egypt, New Zealand, resulting synthetic supply chain. The

Trinidad, and United gas mixture to obtain further environmental

States, thus serving a pure methanol is the value will be captured

global demand and predominant way upon the completion

supply chain. that methanol is of the Geismar 3

manufactured. plant, where low-

They are now carbon methanol will

working on a project be produced by

to produce methanol utilising excess

from excess hydrogen from other

hydrogen from production plants.

steam reforming This plant will emit

plants coupled with 40% less CO2

access to natural gas. compared to other

This Geismar 3 production facilities of

project has a budget the company.

of $1.25-1.3 billion.

Enerkem The company The waste feedstock The sales of renewable

produces sustainable is first separated and methanol generate

Canada methanol from solid processed. The revenue. Further

waste. They created carbon-rich wastes value is captured by

and patented a are converted into licensing the

method for synthesis gas technology, supplying

chemically extracting (syngas), which is equipment/modules,

and reusing carbon purified before being and participating in

from non-recyclable treated with catalysts plant equity in

garbage. to make biofuels and addition to the

commercial technology and

chemicals. equipment provision.

A new plant to be

operational by 2026

is expected to

process some 400,000

tonnes of non-

45
 recyclable solid

waste per year and

produce close to

240,000 tonnes of

methanol.

Proman As the second largest The joint venture is Revenue is generated

methanol producer in now operating three by the mass sales of

Switzerland the world, the methanol-powered methanol worldwide.

company started a ships, and they The deep

joint venture with announced to build decarbonisation of

Stena Bulk to operate of three more vessels. maritime operations

methanol-powered Each vessel is will capture further

ships. expected to burn environmental value

some 12,500 tonnes through their

of methanol per methanol-run vessels.

annum. The use of

methanol as a fuel is

claimed to eliminate

SOx and Particulate

Matter emissions, cut

NOx emissions by

60%, and reduce CO2

emissions by up to

15% on a tank-to-

wake basis versus

conventional marine

fuels.

Hy2Gen The company offers They use Catalytic Revenue through

renewable bio- Partial Oxidation sales of renewable

Germany methanol produced (ATR) to convert methanol, e-

in a large-scale non-conventional methanol, primarily

anaerobic digester short-chain as a transport fuel.

hydrocarbons into
 that converts organic syngas, followed by

waste to biogas. the conversion to

methanol.

The green CO₂ is

recovered from

biogas plants, flue

gas or exhaust gas.

Renewable electricity

such as hydro or

wind power is used

to produce hydrogen

and the necessary

energy input for the

methanol production

processes.

Remarks: Methanol, as an energy asset for distribution and storage, as well as for

transport fuel, is getting more and more attention. There are already well-established

supply chains for methanol (albeit largely produced from fossil fuels), and it is being

demonstrated for new uses, particularly as a shipping fuel. Methanol removes SOx and

particulate matter emissions while reducing NOx emissions by up to 80%, and

renewable methanol can reduce CO2 emissions by up to 95% compared to traditional

fuels 51 . Synthetic methanol production from solar power is still in the Research &

Development phase. Bio methanol production, on the other hand, has successfully

demonstrated numerous pilots worldwide and is now beginning its upscaling journey.

The environmental benefits of using methanol in energy systems are quite convincing.

When we look at the existing and proposed production plants, we can see that renewable

methanol production will steadily increase in the coming years. The substance might be

a viable alternative to aviation and maritime fuel. However, the business is still in its

Appraisal and Upscaling phases and needs heavy demand from the market.

51 Methanol Institute, 2022. The methanol industry.

47
4.9. Pipelines

Regardless of how hydrogen is produced, it must be delivered if it is not produced

directly at the application site. This may be accomplished with several methods, such as

high pressure or liquefied hydrogen in specialised containers or with liquid organic

hydrogen carriers. On the other hand, hydrogen pipelines are better suited for large-

scale, continuous hydrogen demands over moderate distances (up to around 2000 km,

perhaps). The investment costs, or the initial capital expenditure for laying new

dedicated hydrogen pipelines, are a substantial barrier to building new hydrogen

pipeline infrastructure. Therefore, the industry and markets are seeking ways to

repurpose the existing infrastructure for hydrogen use. Table 9 outlines various

companies to examine their contemporary business models.

Table 9. Summary of Hydrogen Pipelines Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Air Products The company has the The hydrogen The pipeline coupled

world's largest pipeline is built in with the hydrogen

U.S. hydrogen pipeline the Gulf of Mexico production plants

network, a total of region in the United promises the refinery

1,100 km worldwide, States. This project and petrochemical

including the Gulf aims at reaching consumers'

Coast system in the economies of scale continuity of supply

USA, stretching over and thus drive down in case a disruption

600 miles (~965 km) the costs, supporting with the traditional

and linking 22 the future growth of energy networks

hydrogen plants with hydrogen use in the takes place. Value is

a daily capacity of region and providing created by building,

more than 1 billion a reliable alternative owning, and

cubic feet per day for large customers operating hydrogen

(~1.3 million Nm3/hr) to be their primary pipelines.

of hydrogen. and/or backup

energy source.
German Gas A consortium of The company is Value is aimed to be

Transmission German gas taking part in the captured by

System Operators transmission system rededication of an supplying green

operators will initiate existing natural gas hydrogen in large

Germany the H2-Startnetz 2030 pipeline to be used volumes to the large

project, which aims to for hydrogen customers in the

construct a 1,200 km transport in the Ruhr industrial areas in

long hydrogen grid in area. This planned Germany. Security of

Germany. Only 100 grid has a length of supply via a

km of this network 130 km, of which 118 dedicated pipeline

will be newly built km is repurposed gas network and

hydrogen pipelines, pipelines and 12 km decarbonisation of

whereas the rest will will be newly built the heavy industrial

be the existing natural hydrogen pipelines. processes are further

gas network values that will be

repurposed. created. Revenue

through the

transmission of

hydrogen.

Smartpipe The start-up offers a It is a non-intrusive Revenue through

Technologies pipeline replacement trenchless pipeline sales of their

technology that pulls replacement technology as a low-

U.S. a composite internal technology and cost way to

pipeline liner through inserted in the repurpose pipelines

an existing pipeline to existing pipelines, for hydrogen.. The

increase structural Smartpipe can also pipelines can be

integrity and allow for be laid as a fully manufactured and

better monitoring. structural, stand- inserted at a speed of

alone high-pressure 1 mile (1.6 km) per

pipeline. Smartpipe day.

meets the U.S. The pipes can

Hydrogen Piping operate under high

Standard B31.12, pressure and meet

49
 Code Case 200. The the hydrogen

pipelines can be transport standards

manufactured and in the United States.

retrofitted according

to the customers'

needs.

Remarks: The hydrogen economy naturally necessitates a robust hydrogen

infrastructure. Pipelines are the initial options for delivering large volumes of hydrogen,

and there is already over 5000 km of hydrogen pipelines in operation worldwide.

However, high initial investment costs for newbuild hydrogen pipelines leads to a

strong interest in repurposing or rededication of existing gas infrastructure. The

compatibility of pipelines, compressors, fittings, and other components in the existing

gas network for the transmission of gaseous hydrogen or natural gas with a high

hydrogen content raises concerns about hydrogen embrittlement, fracture toughness,

and corrosion. The European Hydrogen Backbone study estimates that the hydrogen

network in Europe can reach a length of about 53,000 km by 2040 with an estimated

required investment of €80-143 billion52 . According to the same estimate, 40% of the

network will be dedicated to hydrogen pipelines, and 60% will be repurposed natural

gas network52. Nevertheless, we should stress that this is a massive amount of

investment, and it is highly questionable whether this can be realised or not, and each

pipeline segment will need to be justified by a suitable business case.

4.10. Transport of Liquid Hydrogen by Ship

Together with storage, transport and distribution of hydrogen are troublesome subjects

for planners and businesses as the nature of hydrogen transport differs from traditional

commodities such as natural gas, LNG, or petroleum. The use of ships, especially for the

transport of large amounts of hydrogen, is one of the prominent options for long-

distance transportation. One of the major challenges that shipping liquid hydrogen over

European Hydrogen Backbone, 2022. A European Hydrogen Infrastructure Vision Covering 28 Countries,
52

April 2022.
long distances is the need to keep hydrogen at -253 Celsius while being transported.

Hydrogen can be kept in liquid form in specially designed ships. The transport of

hydrogen is also somewhat similar to the liquefaction of natural gas and transporting it

in the form of LNG, but in this new case, the temperature required for transport is almost

100 degrees colder than for natural gas. To transport hydrogen at these temperatures,

specific transport tanks and vessels must be produced. Alternatively, hydrogen can be

shipped in the form of compressed hydrogen or derivatives such as ammonia or

methanol, which have higher energy densities. The global trade of shipping hydrogen

as cargo is expected to grow. Table 10 presents numerous key players and business

models in the hydrogen shipping business.

Table 10. Summary of Transport of Liquid Hydrogen by Ship Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Kawasaki The company offers The vessel is certified The revenue stream

various hydrogen by the International is expected from

Japan storage and Maritime carrying hydrogen

transportation Organisation and can as cargo over long

solutions. carry 75 tonnes of distances.

Together with Iwatani liquefied hydrogen There is also a

Corporation, Shell in one trip. The potential future

Japan Limited, and liquefied hydrogen is market for hydrogen

Electric Power produced by cooling exports and imports.

Development (J- gaseous hydrogen to

POWER), they minus 253°C,

launched Suiso therefore, reducing

Frontier, the world’s its volume to 1/800.

first liquefied In early 2022, the

hydrogen carrier with ship carried a

a capacity of 1,250 m3. liquified hydrogen

cargo from Australia

to Kobe, Japan. For

the pilot phase,

51
 carbon credits were

purchased for the

CO2 produced, and a

CCS system will be

implemented for the

commercial phase to

export and transport

blue hydrogen in the

future.

Korea Shipbuilding They are planning to The company is The future revenue

& Offshore pilot a concept ship preparing for the stream is expected to

Engineering with a capacity of hydrogen shipping be generated by the

20,000 cubic metres to trial in 2025. sales of large-scale

South Korea transport liquified The cargo size, 20,000 liquid hydrogen

hydrogen overseas. cubic metres, is carriers. Extra value

expected to increase capture is aimed by

over time. capturing the leaked

Around 20 ships hydrogen from tanks

with a 20,000 cubic and turn it as a fuel

meters capacity are to generate power

expected to be built with hydrogen fuel

in the decade starting cells.

in 2030. Depending

on the market

demand, another 200

vessels with 170,000

cubic metres capacity

are expected to be

built after 2040.

Remarks: Transporting hydrogen is a huge challenge and adds significantly to the

supply chain cost. In addition to carrying with trucks and through pipelines, shipping

hydrogen overseas over long distances is one of the options being experimented with

and trialled by the industry. For now, the business is in its very early development stages.
Only one successful trial took place recently, which was carrying liquified hydrogen as

cargo from Australia to Japan. Another trial is expected in South Korea. The odds seem

to be great in this business opportunity as the economy of scale is too far away. Whether

or when commercialisation can be achieved is highly questionable. More promising

alternatives could be shipping hydrogen derivatives such as liquid ammonia, methanol,

and toluene-methylcyclohexane (MCH)53.

4.11. Cement Production

Cement production is an energy-intensive industry where CO2 emissions in cement

plants are sourced mainly from combustion and calcination. Combustion-generated

emissions have resulted from fuel use and consist of around 40% of the total emissions.

Calcination-generated emissions, consisting of the remaining 60%, are due to the raw

materials heated to around 1400 oC and CO2 released from the decomposed minerals.

Cement production accounts for around 8% of the world's CO2 emissions 54 . Global

Cement and Concrete Association (GCCA) aims to decrease the CO2 emission caused by

cement production by 20% by 203055. Reducing the demand for cement is not expected

in the near future. Therefore, deep decarbonisation of the cement industry is being

discussed. Many countries use fossil fuels such as coal in the cement production process.

However, the utilisation of low-carbon fuels is increasing especially in European Union

countries56. At this point, hydrogen is seen as one of the low-carbon alternatives to cut

down emissions in cement production. Table 11 summarises various players and their

business cases that utilise hydrogen in the cement industry.

Table 11. Summary of Hydrogen use in Cement Production Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

53 Patonia, A. & Poudineh, R., 2022. Global trade of hydrogen: what is the best way to transfer hydrogen
over long distances? The Oxford Institute for Energy Studies, OIES Paper: ET16, September 2022.
54 Nature, 2021. Concrete needs to lose its colossal carbon footprint.

55 GCCA, 2021. Concrete Future. The GCCA 2050 Cement and Concrete Industry Roadmap for Net Zero

Concrete. London, UK.

56 El-Emam, R.S., Bagria, N. and Gabriel, K.S. (2021). Integration of Cement and Hydrogen Industries for

Canada's Climate Plan: Case Study. In: Proceedings of the 8th International Conference on Fluid Flow, Heat
and Mass Transfer (FFHMT'21). Canada.

53
HeidelbergCement The company trialled As a commercial UK BEIS funded the

the use of hydrogen demonstration, trial as part of its

Germany in commercial-scale hydrogen is used in Industrial Fuel

cement manufacture the kiln process Switching

at the Ribblesdale instead of coal. In Competition

plant in the UK. addition to programme, which

hydrogen, the fuel had a budget of £3.2

mix also included million.

biomass and plasma Environmental value

energy. This fuel is to be captured by

consists of almost deeply cutting CO2

39% hydrogen, 12% emissions in cement

meat and bone meal production.

(MBM) and 49%

glycerine. The

company claims that

about 180,000 tonnes

of CO2 could be

avoided at the same

plant each year by

just using this fuel

mix.

CEMEX The company is using The company Using hydrogen in

hydrogen successfully used the fuel mix is a part

Spain commercially as part hydrogen in the fuel of a US$40 million

of its fuel mix in all of mix at the Alicante investment program.

its plants in Europe Cement Plant in The technology is

and is now extending Spain in July 2019 now integrated into

this to all of its plants and then extended almost all of their

in the rest of the this to all its plants globally.

world. European plants in Environmental value

2020. The company is captured by

recently invested in a reducing the carbon

British start-up,
 HiiROC, a clean emissions in cement

hydrogen production.

production start-up

that uses thermal

plasma electrolysis

to convert

biomethane, flare

gas, or natural gas

into hydrogen.

Remarks: Using hydrogen in cement production is highly discussed by many; however,

the number of commercial applications is rather limited. The existing trials show that

hydrogen is being evaluated as an additional asset in the overall low-carbon fuel mix

instead of using it as the stand-alone fuel source. Decarbonisation of cement production

is a must to achieve Paris agreement targets. A feasibility study prepared for the UK

Department for Business, Energy and Industrial Strategy (BEIS) discusses several

scenarios of fuel mix at the kiln (thermal fuel use) and calciner processes57. A scenario

suggests that using a kiln mix of 50% hydrogen and 50% biomass and an 83.3% biomass

with 16.7% plasma in the calciner removes fossil fuel CO2 completely by leaving only

process CO2 from the breakdown of raw materials and CO2 from biomass fuels (BEIS,

2019). Obviously, a clean-fuel mix promises a lot to bring down emissions; however, the

application of this technology is at its early stages. We should also mention that utilising

just CCUS to decarbonise cement production is also an option58. Hydrogen use in the

cement production business is still in the Develop phase and needs many more industry

players to adopt it and commercially demonstrate that the use of hydrogen is a viable

option for tackling emissions.

57 BEIS, 2019. Options for switching UK cement production sites to near zero CO2 emission fuel: Technical
and financial feasibility. London, UK.
58 Abdelshafy, A., Lambert, M., Walther, G., 2022. The role of CCUS in decarbonizing the cement industry:

A German case study. Energy Insights 115, The Oxford Institute for Energy Studies, May 2022.

55
4.12. Engineering Services for Hydrogen Infrastructure

Constructing an infrastructure for a low-carbon economy is a challenge when

considering to capital expenditure needed. Sustaining this low-carbon energy system

hardens operational profitability since carbon-free or low-carbon technologies require

additional operational processes and maintenance investments. At this point, several

companies offer engineering and consultancy services for hydrogen projects to install,

operate and maintain plants and infrastructure. Table 12 compiles some of the business

models of engineering services for hydrogen infrastructure.

Table 12. Summary of Engineering Services for Hydrogen Infrastructure Business

Models
Company Value Proposal Value Creation Value Capture

(what?) (how?)

Worley They offer The company Revenue through

maintenance, delivers feasibility consultancy services

Australia modifications and studies, plant in a broad range of

operational services to designs, consultancy technical and

hydrogen-based for technical and economic subjects.

customers to ensure market analysis,

risk and cost reduction engineering,

in their projects. procurement and

construction, and

technical council for

numerous hydrogen-

related projects all

around the world.

Ricardo An engineering and The company has a Revenue is captured

environmental broad range of by a broad range of

UK consultancy company services, including engineering and

offering technical and hydrogen powertrain consultancy services

non-technical development and for hydrogen-related

solutions for hydrogen integration, projects, investments

and infrastructure.
operations and vehicle optimisation,

infrastructure. including thermal

They deliver services management and

from policy power distribution,

development to simulation and

infrastructure modelling,

feasibility through to fuel cell system and

the implementation hydrogen engine test

and integration of facilities,

hydrogen-based retrofit solutions,

technologies. leak detection,

cost reduction,

lifecycle analysis,

testing and

development,

technology road

mapping and market

forecasting,

regulatory and policy

analysis,

market and

technology studies,

hydrogen fuel cell

technology strategy,

product development

and market entry

strategies,

scenario planning for

decarbonisation,

the total cost of

ownership and

return on investment

modelling,

57
 infrastructure

analysis,

air quality,

supply chain

development,

data collection, and

technical due

diligence.

Lean Hydrogen They are a green They offer support Revenue stream

hydrogen project throughout the through engineering

Spain engineering and bidding process, service for hydrogen

consulting company. market research, key production plants

player analysis, and and hydrogen

studies of industrial refuelling stations,

safety and standards, hydrogen project

in addition to techno- consulting, assistance

economic feasibility in environmental

analysis for permits and

electrolytic hydrogen procedures, and

projects. They also control systems

deliver design programming.

solutions for the

construction,

commissioning,

operations, and

maintenance of green

hydrogen plants.

Remarks: The business opportunity with engineering and consultancy services for

hydrogen infrastructure can be extended into strategy and planning, project

development or pre-development, and advisory services for operations and

maintenance. Engineering services firms have similar revenue streams, with more

distinctions occurring in pre-development phases and the scope of advisory processes,

including due diligence and risk management. Apart from these, commercial value
capture is based on predictive maintenance and discovering opportunities for bottom-

line improvements. Further sources of revenue capture are feasibility studies with

technical and economic scope, advisory support for technology adoption decisions, and

identification of cost efficiencies and benefits regarding capital and operational costs. As

the number of hydrogen projects and operational plants increases steadily worldwide,

the need for such services will increase accordingly. We believe the business has already

completed its Appraisal phase and is now in Upscaling. Whether this business will reach

market diffusion or not totally depends on the overall commercial success of the

hydrogen economy.

4.13. Fuel Cells

A fuel cell is an electrochemical medium that is utilised for generating electricity. Fuel

cells generate electricity by using chemical bonding energy between hydrogen and

oxygen atoms. The only wastes are water and heat. Stationary fuel cells can be used for

the cogeneration of heat and power, distributed power generation, backup power, and

remote location power. Some might claim that almost all portable devices, including

hand-held devices and portable generators, that traditionally utilise batteries can

theoretically be powered by fuel cells. Additionally, fuel cells can power contemporary

transportation, including cars, trucks, buses, and ships, as the only power source or as a

complementary or auxiliary power source59. When used with low-carbon hydrogen, fuel

cells promise to reduce CO2 emissions and provide a reliable energy source radically.

Some of the key issues regarding the hydrogen fuel cells can be summarised as weight

and volume concerns, efficiency, durability, refuelling time, cost, the lack of standards,

life cycle and efficiency analyses60 . Table 13 summarises a few business cases to examine

some business models.

Table 13. Summary of Fuel Cells Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

59 U.S. Department of Energy, 2008. Hydrogen Fuel Cells.

60 Energy.Gov, 2022. Hydrogen Storage Challenges.

59
Ballard They offer fuel cells The company Revenue is generated

and commercialise promises high fuel by the sales of fuel

Canada them for different use efficiency, low noise cells. The company

areas such as buses, and vibration, has already

trucks, trains, ships, compact size, quick delivered 850MW of

backup power at response to changes fuel cell stacks,

critical infrastructure, in electrical demand, modules and

and grid-scale and modular design systems to its

renewable energy with its products. customers. The

storage. Together with the modular design

vertical integration of makes it possible to

Membrane Electrode reach a broad range

Assembly and stack of customers with

design, the company different use

can provide fuel cell requirements, from

solutions for a wide transport to

range of customers' stationary power

needs from 5kW to solutions.

200kW.

Plug Power The company provides ProGen is a fuel cell Revenue through the

hydrogen and fuel cell engine designed for sales of fuel cells.

U.S. solutions through its use in motive and They are expanding

end-to-end green stationery products. their customer

hydrogen ecosystem, GenDrive is offered portfolio towards on-

including production, for material handling road vehicles,

transportation, storage applications, and robotics, and data

& handling, GenSure is a backup centres.

dispensing, and usage power solution for

of hydrogen to various low and high-power

markets such as zero- stationary

emission on-road applications.

vehicles, data centres,

 robotics, and

microgrids.

FuelCell Energy The company provides The product Revenue is generated

on-site power plants SureSource enables by the sales of

U.S. that use natural gas or on-site and large- SureSource, which

renewable biogas as scale hydrogen produces hydrogen

input and then reform generation to either and then clean water

it inside a fuel cell into power transportation and electricity in

hydrogen, which then or industrial urban locations.

electrochemically applications or SureSource is

reacts with air to provide excess commercially used

generate power and hydrogen for other as a part of a 2.3MW

heat. uses. The most trivial project with Toyota

advantage is to Motor Corporation

produce and in California.

consume hydrogen

in urban locations.

A typical 1.4 MW

module emits 445

kg/MWh of CO2 (236-

308 kg/MWh with

heat recovery). (2019

U.S. national

average: 401

kg/MWh).

HyAxiom They provide single- They have a range of Revenue through

fuel cell applications scalable and modular sales of PureCell

U.S. for commercial products that can fit Model 400 Hydrogen

buildings and multi- various needs. fuel cell as a clean

fuel cell installations PureCell Model 400 and reliable power

for data centres, Hydrogen is a and heat source.

industrial facilities, hydrogen energy 50% electricity and

and microgrids. solution generating 35% heat comprises a

460 kW of clean

61
 energy and water. total of 85% overall

This system also efficiency.

produces 1.7 million

BTU/hour of usable

heat and is able to

run off of green

hydrogen.

Remarks: Hydrogen fuel cells can generate electricity at an efficiency of 40-60%, which

is higher than a conventional combustion-based power plant's typical efficiency of 35%61.

However, we should stress that the power conversion efficiency is around 99% with Li-

Ion batteries, so in many applications, batteries will be preferred. Of course, recovering

the output heat will enable increasing the overall fuel cell efficiency depending on the

product and application. Fuel cells have certain advantages, such as being emissions-

free (or low emissions depending on the hydrogen source), using an infinite source of

energy (electrolytic hydrogen), promising a high range for transport solutions, and fast

refuelling capabilities. However, we should also underline some disadvantages, such as

lower efficiency compared to batteries, highly flammable hydrogen, poor infrastructure

for refuelling purposes, and very high costs. We can see that the supply side of the fuel

cells is working quite well as the technology is now mature and well known.

Nonetheless, the demand for fuel cells is rather limited even though the application areas

are quite broad. The business is at its Upscaling phase. A boost in demand is necessary

before it reaches the market diffusion phase. Volvo Group reaffirms our observation by

stating that the hydrogen fuel cell business is some years away before it becomes

commercially available62.

4.14. Glass Production

Being an energy-intensive sector, the glass manufacturing industry plays a crucial role

in mitigating the adverse effects of climate change and to meet the goals set by the global

framework of the Paris Agreement. Despite this energy-intensive process, since the

61 U.S. Department of Energy, 2008. Hydrogen Fuel Cells.

62 Volvo Group, 2022. What are hydrogen fuel cells?
volumes of glass delivery are lower than those of other energy-intensive products, the

share of energy consumption in the glass industry is comparably low. U.S. Energy

Information Agency reports that the sector accounted for 1% of total industrial energy

use in the U.S. in 201863. The decomposition of the energy input was natural gas (73%)

and electricity (24%), and other (3%)63. Another study from the UK highlights that glass

manufacturing is causing only 3% of the UK industry's GHG emissions 64 . Many

stakeholders in the glass market feel the responsibility for finding the most cost-efficient

and reliable ways of producing glass without emitting CO2. At this stage, hydrogen steps

forth as a green or low-carbon heating alternative to drive this shift. However, switching

from traditional carbon-intensive sources to hydrogen is not an easy task when

considering old equipment tailored for natural gas might not be directly suitable for

hydrogen use in the manufacturing process. Surely, the cost of this transformation is

another big challenge. Table 14 presents the business models of some key players in

using hydrogen in the glass production industry.

Table 14. Summary of Glass Production Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Air Products They offer hydrogen Their hydrogen can Hydrogen sales

for atmosphere control be used to through bulk

U.S. to prevent oxidation, supplement or deliveries or

improving efficiency replace air-fuel pipelines, on-site

in cutting, polishing, combustion generation plants

heat treating, and applications for and storage systems.

melting and softening increasing heat For the glass

applications in the transfer and industry, further

glass industry. achieving more value is captured via

efficient glass cutting improved efficiency

and polishing, in cutting, polishing,

63 EIA, 2018. U.S. Energy Information Agency, Glass manufacturing is an energy-intensive industry mainly
fueled by natural gas.
64 Griffin, P.W., Hammond, G.P. and McKenna, R.C., 2021. Industrial energy use and decarbonisation in the

glass sector: A UK perspective. Advances in Applied Energy, 3, p.100037.

63
 annealing, heat treating, and

tempering, melting and

strengthening, and softening

toughening, faster applications.

melting or softening

of glass, and

preventing negative

reactions like the

formation of glass

defects and helping

to protect the

chambers and/or

equipment.

HyGear They offer on-site Hy.GEN is a small- A revenue stream is

small-scale hydrogen scale SMR-type generated by the

Netherlands generators to glass hydrogen generator sales of products

manufacturers. that can be installed such as Hy.GEN and

They provide at the customer's site. Hy.RECmix.

products for gas Hy.RECmix recovers Further

recovery of the a portion of environmental value

polluted gas mixtures hydrogen and is captured by

from the tin bath in nitrogen from the reducing GHG

float glass production. output gas and emissions.

They also offer on-site reuses this reductive Electrolytic hydrogen

nitrogen generation gas mixture in the generation is also

necessary for float manufacturing as available for

glass production. input. customers through

In the process of Hy.GEN-E. This

making float glass, means further

this reductive gas reductions in

mixture of hydrogen emissions also

and nitrogen is improve supply

required over the tin security by being on-

 bath to stop the glass site self-sufficient

from oxidising. energy generation.

Pilkington They conducted the By switching from Expected value

first trial of using natural gas to capture from the use

UK hydrogen in the hydrogen, they of hydrogen as a

architectural glass trialled running the low-carbon fuel.

production process in float furnace to heat Being a government-

the world in 2021. it around 1,600 supported trial

degrees centigrade. project, they received

This three-week trial £5.3M funding

on the float glass line through Energy

made use of around Innovation

60 road tankers of Programme in 2020.

hydrogen.

This was a part of

UK's HyNet

Industrial Fuel

Switching initiative,

which aims to cut 10

million tonnes of

carbon per year by

2030.

Remarks: The idea of using hydrogen in the glass industry has emerged, but the number

of applications and demonstrations is rather limited. Glass manufacturing is a complex

process with various steps. Hydrogen might be used in furnaces where around 20% of

the whole energy consumption occurs. Whether hydrogen can be used in these furnaces

as the only energy source or a hybrid design is better is still debatable. Increasing NOx

emissions with increasing temperatures in the production process is another concern

regarding hydrogen use 65 . SCHOTT from Germany is about to start its own trial of

hydrogen use in glass manufacturing with a €714,000 R&D budget, of which €338,000

65 Energy: Using Hydrogen for Glass, 2022. Andrew Keeley and Mike Haden, The Chemical Engineer.

65
came from the European Regional Development Fund66. We can clearly see that R&D

activities are still going on, and a self-sustaining business is not viable yet. This means

that the business case is still in the Value Proposal and Value Creation phase, and there

needs to be much more effort before the business case goes into the upscaling phase. We

should stress that the claim of "improving efficiency in cutting, polishing, heat treating,

and melting and softening applications in the glass industry" needs further evidence and

substantiation.

4.15. Hydrogen Certifications

As plans for the clean hydrogen economy develop, many players are developing projects

along with a variety of specifications. This trend brings regulatory challenges. There is

a need for standardisations and hydrogen certification mechanisms to provide hydrogen

stakeholders with an independent and globally recognised verification system for

sustainable and carbon-neutral futures. This provides an opportunity for companies to

develop certification systems. Table 15 presents various companies and their business

models in the hydrogen certification field.

Table 15. Summary of Hydrogen Certifications Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

TÜV Rheinland The company offers Standard H2.21 is a Revenue is generated

testing and carbon- Carbon-Neutral by standardisation

Germany neutral hydrogen Hydrogen and certification

certifications, certification. The sales.

including green status is issued if The hydrogen

hydrogen and green Corporate Carbon customers capture

ammonia certificates. Footprint, which is further value by

measured by the acquiring an

amount of independent and

greenhouse gases internationally

emitted resulting recognised

66 SCHOTT, 2022. SCHOTT developing climate-friendly glass production using hydrogen.

 from the operation of verification of the

a company per time climate neutrality of

period or Product their hydrogen.

Carbon Footprint,

which is measured

by the amount of

greenhouse gases

emitted associated

with a product's life

cycle or life cycle

stage is fully offset by

appropriate

mitigation or Carbon

Capture and Storage

measures.

CertifHy They provide CertifHy certification The scheme has been

hydrogen certification enables customers to initiated at the

EU schemes across track hydrogen's request of the

Europe that constitute origin and European

a basis for customers environmental Commission and is

to track hydrogen attributes. According financed by the Clean

flows and their to the European Hydrogen

environmental Renewable Energy Partnership.

impacts. Directive, they are Current certifications

developing an EU are given in Europe;

Voluntary Scheme however, they are

for the certification of planning to expand

hydrogen as globally.

Renewable Fuel of The cost of

Non-Biological certifications varies

Origin. CertifHy GO depending

scheme grants a customer’s profile.

tradable value to The certificate

expires automatically

67
 renewable and non- 12 months after the

renewable hydrogen. end of the production

period for the related

production batch.

Revenue is generated

by issuing

certificates.

Intertek They provide testing The company offers The company's

and certification of Atmosphere certifications ensure

UK hydrogen refuelling Explosibles (ATEX), the customers access

stations, hydrogen International potential markets in

fuel components and Electrotechnical Asia, Europe, and

systems, including Commission for North America.

dispensing, Explosive

compression, and Atmospheres (IECEx)

storage systems, and Electrical Testing

electrolysers, chiller, Labs (ETL)

reformers, and certifications.

stationary fuel cell ATEX is a mandatory

systems. certification for all

products to be sold

across Europe.

IECEx means that

products must go

through a monitored

process by the

International

Electrotechnical

Commission to

ensure that they meet

the minimum safety

requirements in

Europe, Canada,

Australia, Russia,
 China, the United

States and South

Africa.

ETL means that

products have been

tested to set safety

standards in North

America.

Remarks: The business opportunities in the hydrogen economy are expanding into the

transportation, chemical, heavy industries and power generation sectors globally. There

is an emerging need for safety standardisations of hydrogen and its derivatives as the

substance is flammable and explosive. Furthermore, as there is a lack of internationally

accepted metrics for low-carbon hydrogen and confusion with colour coding,

certification mechanisms are needed worldwide. As the business model for testing and

certifications has the nature of “renewal” after certain periods, the business can generate

a self-sustaining revenue stream if a sufficient number of customers can be reached. The

hydrogen certifications business seems to have completed its Value Creation phase, but

the upscaling will require time as the certifications might differ regionally in the world.

A globally accepted standardisation of low-carbon hydrogen and a certification

mechanism surely will gain a lot of momentum in terms of generating a sound and

sustainable revenue stream.

4.16. Hydrogen Fuel Stations

Developing new hydrogen technologies results in new business models and

transformation in existing sectors. Hydrogen fuel stations are such examples. While they

resemble traditional fuel stations initially, the process behind them differs from the

conventional stations. They have an intermediate step to transform stored hydrogen into

high-pressure hydrogen for refuelling, which requires additional equipment. They are

divided into two groups depending on whether the hydrogen they provide is gaseous

or liquid. Compared to fossil fuels, the advantages of hydrogen fuel for the

transportation sector include comparable recharge durations and driving ranges.

69
Consumers are looking for zero-emission vehicles which have performance comparable

to today's fossil-fuelled vehicles. Like standard fuel infrastructure, hydrogen

infrastructure can be constructed at any gas station. Hydrogen fuel stations represent

the hydrogen trade's final process before reaching end users, especially in the transport

sector. There are various concerns and challenges regarding the hydrogen fuel stations.

Fire and explosion, hydrogen leak in piping, leak in electrolyser, leak in storage tank,

leak at breakaway fitting, compressor failure, hose pressure rating verification error,

improper fill speed at fuel dispenser, incorrect check valve installation, and vehicle

crashing into refuelling station could be listed as some of these concerns 67 . Table 16

summarises some of the business models of hydrogen fuel stations.

Table 16. Summary of Hydrogen Fuel Stations Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

HTEC They construct and The company is A revenue stream is

operate hydrogen fuel actively running four generated by the

Canada stations for fuel cell stations as sales of hydrogen as

transport units in businesses, with two fuel at the stations.

Canada and United more in late-stage On-site green

States. development and hydrogen generation

eight in early-stage and storage units

development. add further value

The fuel station in added to the

California has its business.

own electrolyser with They develop, own,

a capacity to produce and operate

40 kilograms of hydrogen

hydrogen per day. production facilities,

They also offer distribution systems,

modular hydrogen and fuel stations.

67Vereš, J., Ochodek, T., and Koloničný, J, 2022. Aspects of Hydrogen Fuelling Stations. Chemical
Engineering Transactions Vol. 91.
 storage systems for

transportation and/or

ground storage.

Linde They offer a full The company has A revenue stream is

project lifecycle for the already built more generated by the

Germany hydrogen fuel stations than 200 hydrogen sales of project

from planning and refuelling stations lifecycle services

design through build worldwide. They (LCS) as well as fuel

and commissioning to deliver both gaseous stations.

service and and liquid refuelling Offering both liquid

maintenance. with their Ionic and gaseous

Compressor and the solutions and

Cryo Pump portable units adds

technologies. They further value to their

also developed business.

FuelBox, an all-in-

one transportable

hydrogen refuelling

station with an

intermediate H2

storage tank and

dispenser. This unit

is 12 m², ready-to-run

and can be deployed

anywhere depending

on the need in a short

time.

Remarks: The future of the hydrogen fuel station business depends on the success of

hydrogen use in the transport sector. While the number of companies offering hydrogen

refuelling stations is increasing steadily, a radical boost in the number of stations is still

not on the horizon. According to statistics from 2021, Japan has the highest number of

71
fuel stations in the world (154), followed by South Korea (112) and Germany (91)68. The

Japanese government announced a plan to increase this number to 1000 by the end of

203069. Surely these numbers are dwarfed when compared to the existing and future

projections of the electric vehicle charging stations. The number of public EV charging

stations reached 1.8 million worldwide by 202170. About 500 000 EV charging stations

were installed just in 202170. The hydrogen fuel station business is still at its Value

Creation phase, and Upscaling seems to require some more decades.

4.17. Hydrogen Use in the Transport Sector

The transportation sector was responsible for around 20% of the CO2 emissions globally

in 202171. Of this, aviation stands for 8%, shipping 11% and rail 3%, where around 78%

of the transport sector emissions have resulted from road surface transport71. To achieve

the Paris Agreement targets, a radical transformation from fossil fuels to clean fuels must

be realised in the transportation sector. To experience this vast transformation,

hydrogen-fuelled cars like electric cars are thought to be a viable alternative to petrol-

fuelled cars. Many companies are working in this field, and the resulting products are

generally based on the presence of fuel cell technology in vehicles or the use of hybrid

systems. In hybrid systems, diesel fuel is generally used together with hydrogen. Efforts

are also being made to make the internal combustion engine fully hydrogen-fuelled, but

it is a bit more difficult to produce fully hydrogen-powered internal combustion engines

because special injection systems have to be developed for these engines 72 . Another

alternative is the use of fuel cells in vehicles. This technology stores hydrogen in special

hydrogen tanks in transportation vehicles. These vehicles are electrically powered, so

they have an electric motor. Fuel cells power up like batteries but do not need to be

recharged. As long as fuel is supplied, these cells continue to produce electricity and

heat. Various businesses emerged in almost all aspects of the hydrogen-fuelled transport

sector. Table 17 summarises some of the key actors and their business models.

68 Statista, 2021b. Number of hydrogen fueling stations for road vehicles worldwide as of 2021, by country.
69 Hydrogen Central, 2021. Japan Targets 1,000 Hydrogen Stations by End of Decade.
70 Global EV Outlook, 2022. Trends in charging infrastructure.

71 Statista Research Department, 2022. Transportation emissions worldwide - statistics & facts.

72 Nebergall, J., 2022. How do hydrogen engines work? | Cummins Inc.

 Table 17. Summary of Hydrogen in the Transport Sector Business Models
Company Value Proposal Value Creation Value Capture

(what?) (how?)

ZeroAvia The company They replace Revenue is generated

provides zero- conventional aircraft by the sales of

UK emission powertrain engines with hydrogen-electric

and hydrogen-electric hydrogen-electric powertrains.

engines for aviation. powertrains. They The company claims

trialled hydrogen that hydrogen-

fuelled flights from electric powertrains

20-seat regional trips offer

to over 100-seat long- 90% lower life cycle

distance flights. emissions compared

Green hydrogen to turbines, 60%

stored in tanks is lower powertrain

converted to operating costs

electricity in flight compared to

using a fuel cell, turbines, and 75%

which then powers lower hourly

the electric motors. maintenance costs.

Alstom Coradia iLint is a The train is powered Revenue through the

commercial hydrogen- by hydrogen fuel sales of hydrogen

France powered passenger cells. trains.

train trialled in Together with Linde, Environmental value

Germany in 2018. The Alstom built the is captured by

train has travelled world’s first lowering emissions

more than 200,000 km hydrogen filling in rail transport.

since then. station for passenger The hydrogen fuel

trains in Germany. A station promises

total of 14 hydrogen continuity of supply.

fuel cell trains will be

built and put on rails

in Germany in 2022.

73
New Times The company The Kriti Future Value is captured by

Shipbuilding delivered the world’s received the the use of ammonia

first ammonia-ready American Bureau of as a high-density and

China ship Kriti Future. The Shipping’s low-carbon shipping

ship is running on classification of ABS fuel in maritime

conventional fuel, but Ammonia Ready operations.

it is convertible to use Class 1. According to

ammonia as the main the regulations,

fuel. anhydrous ammonia

is extremely harmful

to aquatic life, so

relief or direct

discharge to

seawater is to be

avoided.

Hyundai They offer several NEXO series cars The revenue stream

hydrogen-powered make use of fuel cells is generated by the

South Korea road transport with a five-minute sales of hydrogen

vehicles. fill-up time and 413 cars and trucks.

miles (666 km) of Renting is also

range. The car has a offered in some

maximum speed of countries. The

111 mph (179 kph). company claims that

XCIENT is a its second-generation

hydrogen-powered fuel cell technology

fuel cell truck. The has the highest

truck’s fuel cell system efficiency in

delivers 180 kW of the world,

power and a driving consuming 1kg of

range of 400 km. hydrogen per 100km.

XCIENT fuel cell

does not require urea

and engine oil which

 makes it superior to

diesel engine trucks.

Remarks: The use of hydrogen in road transport is not new, as the first hydrogen car

was introduced in 1966. Similarly, the first hydrogen fuelled aircraft (Tupolev 155) was

successfully tested in the Soviet Union back in 1988. The upscaling of the business has

not taken place since then. Perhaps we should mention the factor of alternatives and

competition here. The use of battery electric vehicles in road transport has achieved

momentum and has already reached the commercialisation and market diffusion phase.

So, to achieve a low-carbon road transport transition, hydrogen has a strong competitor

and probably has already lost this competition. In comparison, the picture differs in

aviation and maritime operations. For long-haul and heavy-duty road surface transport,

hydrogen might stand a chance as well. Being low-energy-density options, batteries are

not viable solutions in these sectors. Here, hydrogen might be deployed as the primary

low-carbon technology. The use of LNG, methanol, ethane, liquefied petroleum gas

(LPG), hydrogen, and ammonia as an alternative to traditional residual or distillate

marine fuels may be anticipated to become more widely adopted by the marine industry

as a result of an increased commitment from the International Maritime Organization

(IMO) to reduce emissions from shipping. According to a survey, to meet the IMO’s 2050

decarbonisation targets, 47% of the stakeholders mentioned LNG, 40% hydrogen, 8%

ammonia, and 5% mentioned methanol as the future fuel for maritime operations73. For

example, this year, the Danish company Maersk ordered 12 methanol-powered

container vessels from Hyundai Heavy Industries. The ships are to be delivered in 2024

and 2025. The expectation might be on a smaller scale in the aviation sector as the

existing number of hydrogen-powered aircraft is quite few for the time being. Therefore,

in summary, the business as a whole is still in the Value Creation phase with numerous

pilots, and efforts are still needed to go upscaling.

73 Ship Technology, 2022. LNG and hydrogen fuel option to help shipping meet IMO targets.

75
4.18. Hydrogen Use for Heating

In 2018, heat accounted for 50% of all final energy consumption worldwide and

contributed 40% of all CO2 emissions globally74. As a result of the global climate problem,

there is a surge in eco-awareness, which drives demand for environmentally sound

heating systems. One alternative to conventional fossil fuel energy sources is hydrogen-

based heating. It is simple to convert low-carbon hydrogen into thermal energy or

combined heat and power if the hydrogen can be delivered or stored on-site. Some

businesses encourage this environmentally friendly move by releasing hydrogen-

powered household heating appliances for both commercial and residential use. The

compatibility of the existing infrastructure and heating equipment, risk of explosion due

to flammable nature of hydrogen, uncertainties in retail pricing and capability of

meeting the peak demand are some of the key concerns and challenges of using

hydrogen for heating. Table 18 summarises some business models of hydrogen use in

heating systems.

Table 18. Summary of Hydrogen for Heating Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Panasonic They offer H2 KIBOU The generator's total A revenue stream is

hydrogen fuel cell, energy efficiency, generated by the

Japan which can produce which includes heat sales of hydrogen

5kW of power and recovery, can reach fuel cell systems for

uses waste heat for 95%, enabling combined heat and

heating hot water. efficient energy use power purposes to

with zero waste. commercial and

The company also residential customers.

offers ENE-FARM Environmental value

for residential use. is captured by

This household fuel reducing emissions in

cell cogeneration heating as long as

system is claimed to

74 IEA Renewables, 2019. Heat.

 achieve a total low-carbon hydrogen

efficiency of 97%. is used.

Heatlie The company offers They claim the Value is created by

hydrogen-fuelled hydrogen barbeque increased heating

Australia barbeque. consumes roughly efficiency achieved

half as much fuel as by hydrogen use.

natural gas and LPG They claim the

while creating equal product reduces

heat output. emissions, thus

creating

environmental value;

however, the source

of hydrogen is not

specified. Revenue

stream through the

sales of hydrogen

barbeque.

Worcester Bosch They offer hydrogen The company's all The hydrogen boilers

boilers for home boilers are now are safer in terms of

UK heating. hydrogen-blend not emitting CO,

ready, meaning that meaning there's no

they can run on a chance of a leak.

blend of 80% natural Lower GHG

gas and 20% emissions, NOx

hydrogen. emissions and easy

Hydrogen-ready installation and

boilers, which can commissioning are

run on 100% further advantages.

hydrogen, are not

commercially

available yet.

77
Remarks: Heating is one of the major problems regarding emissions and climate change.

Hydrogen use in heating purposes, such as boilers for household heating or domestic

appliances like barbeques, has started to appear on the market. Furthermore, many

market players and researchers also propose large-scale heating, such as district heating.

However, when we evaluate the viability of a business, we should also consider

alternative options. Heating with natural gas is a robust and mature business; replacing

it with a low-carbon alternative will not be easy. Heat pumps are also available to

decarbonise the heating and replace natural gas with a low-emission option. The first

comparative advantage of heat pumps is their efficiency. A study shows an example

where 100 kWh of renewable energy is used as input for heating75. The hydrogen boiler

gives 46 kWh of heat, whereas a traditional electric space heater 86 kWh and thanks to

the Coefficient of Performance, the heat pump yields 270 kWh of heat energy75. The

overall efficiency of a typical heat pump is around six times higher than that of a

hydrogen boiler. Hydrogen for heating is still at its piloting and appraisal phases, and it

is highly doubtful whether it will ever reach its Upscaling phase.

4.19. Petroleum Refining

The sectors that use the output products of the refinery process include agriculture,

manufacturing, construction, and mining. Thus, one might say that the output of

refinery processes touches nearly all sectors of the global economy. The refinery process

includes the conversion of crude oil to an energy source including gasoline, jet fuel,

diesel, propane and butane, or fuel oils, coke, and industrial chemicals. In the petroleum

refining sector, hydrogen is used, for example, to lower the sulphur content of diesel

fuel. As sulphur specifications become tighter and the demand for diesel fuel has

increased, the refinery demand for hydrogen has increased. Hydrogen is mainly used in

the hydrotreating and hydrocracking steps in refineries. To lower refined products'

carbon footprint, several players seek to use increasing amounts of low-carbon hydrogen

in their refining operations. In Table 19, we reviewed the various business models to

examine low carbon hydrogen use in petroleum refining.

75 Cebon, D., 2022. Hydrogen for heating? A comparison with heat pumps.
 Table 19. Summary of Hydrogen Use in Petroleum Refining Business Models
Company Value Proposal (what?) Value Creation Value Capture

(how?)

Aramco They use blue They are building a Neom project has a

hydrogen in hydrogen plant with budget of $5 billion,

Saudi Arabia hydrotreating, Air Products in and the joint venture

hydrocracking, and Neom to produce at Jazan is $15

hydroisomerisation 240,000 tonnes of billion.

processes to produce both blue and green

gasoline, jet fuel, hydrogen by 2025.

diesel, kerosene, and They also created a

other end-products. joint venture to

produce an air

separation unit,

gasification, and

power plant at

Jazan. The Jazan

Refinery is to

process 400,000

barrels of crude oil

per day, and the

joint venture will

supply hydrogen for

this refinery.

ExxonMobil The company is They are The deep

planning to use constructing decarbonisation of

U.S. hydrogen as fuel at one hydrogen refinery sites will

of its refineries in production, carbon capture the

Texas. capture, and storage environmental value

plants at its when hydrogen is

integrated refining used as fuel for

and petrochemical petroleum refining.

site in Texas. This

plant is to produce 1

79
 billion cubic feet (~

28 million m3) of

blue hydrogen per

day. The carbon

capture

infrastructure will be

able to transport and

store up to 10

million metric tons

of CO2 per year.

Shell They will be using 10 MW of The REFHYNE

green hydrogen in electrolyser is being project is a part of

The Netherlands- Shell's Rhineland built on-site to Clean Refinery

UK refinery. produce 1,300 tonnes Hydrogen for

of green hydrogen Europe, funded by

per year. ITM Power the European

will produce the Commission.

hydrogen, and Shell

will operate the

plant.

Remarks: The hydrogen demand for refineries can be estimated with low error margins

as the process and technology are well known and mature. Almost 80% of hydrogen is

currently produced through emissions-intensive natural gas reforming and coal

gasification 76 . And petroleum refining is one of the largest markets for hydrogen,

accounting for about 32 million tonnes per year, nearly 30-35% of global hydrogen

demand in 202077. The main business opportunity arises at the point of producing low-

carbon hydrogen for the refining industry. The other opportunity is whether to produce

the necessary amount of hydrogen on-site or buy it externally. For example, in the

United States, the on-site refinery hydrogen production increased by less than 1%, while

hydrogen supplied by merchant producers increased by 135% between 2008 and 2014

76 IEA, 2021. Hydrogen, IEA, Paris.

77 Wood Mackenzie, 2022. Low-carbon hydrogen demand in refining could reach 50 Mtpa by 2050.
whilst the hydrogen demand of the refineries increased by 60% in the same period78. To

answer the challenge, the European Commission is now financing a project to install a

10 MW electrolyser for one of the Shell refineries in Germany to produce on-site 1,300

tonnes of green hydrogen per year79. Furthermore, Saudi Aramco will need 1.93 million

tonnes of blue hydrogen by 2030 80 . Enhanced reliability is a natural result of on-site

generation. On the other hand, ExxonMobil is also planning to produce on-site hydrogen

and use this as fuel at one of their refineries. The main advantage of hydrogen use in

petroleum refining is to reduce emissions. For instance, ExxonMobil claims that if one of

its refineries is fuelled by hydrogen, the integrated site emissions would be reduced by

up to 30%81. Hydrogen use in petroleum refining is a mature business. Yet the use of low

carbon hydrogen at the refinery sites is still in the Develop phase with some pilot projects.

4.20. Steel Production

Steel production is another highly energy-intensive process. International Energy

Association's study reports that steel making is responsible for about 8% of global final

energy demand and 7% of energy sector CO2 emissions 82 . A study underlines that

around 2.8 billion tonnes of CO2 were emitted annually from the steel industry

worldwide in 2020, making up 7% of all CO2 emissions globally. The emission from the

steel sector should be reduced to a level of 400-600 million tonnes per year in 205083. On

the other hand, global steel production is expected to grow by 25–30% by 205084. These

necessitate an emerging need for decarbonising the steel industry. Hydrogen is one of

the proposed solutions for decarbonisation efforts. It can be used as an alternative

injection material or auxiliary reducing agent in pulverised coal injection in a blast

furnace to improve the performance of conventional blast furnaces. Furthermore,

78 EIA, 2014. U.S. Energy Information Administration. Hydrogen for refineries is increasingly provided by
industrial suppliers.
79 Refhyne, 2022. Clean Refinery Hydrogen for Europe.

80 Recharge, 2022. Aramco targets 12GW wind and solar and two million tonnes of blue hydrogen.

81 ExxonMobil, 2022. ExxonMobil planning hydrogen production, carbon capture and storage at Baytown

complex.
82 Energy Technology Perspectives, 2020. IEA Iron and Steel Technology Roadmap.

83 Pei, et al., 2020. Toward a Fossil Free Future with HYBRIT: Development of Iron and Steelmaking

Technology in Sweden and Finland Metals 2020, 10(7), 972.

84 Holappa, L., 2020. A General Vision for Reduction of Energy Consumption and CO2 Emissions from the

Steel Industry. Metals 2020, 10(9), 1117; https://doi.org/10.3390/met10091117.

81
hydrogen can also be used to produce direct reduced iron. Table 20 introduces some of

the business models of hydrogen use in steel production.

Table 20. Summary of Hydrogen Use in Steel Production Business Models

Company Value Proposal Value Creation Value Capture

(what?) (how?)

Ovako They trialled the first Instead of using The deep

commercial use of LPG, in collaboration decarbonisation of

Sweden hydrogen in steel with Linde, they steel making will

manufacturing at one used hydrogen to capture the value.

of their plants in heat steel furnaces The environmental

Sweden. before rolling. value will be

captured by

mitigating 20,000

tonnes of CO2 each

year. Further funding

and industry

collaborations are

needed for a wider-

scale application.

ArcelorMittal The company They wanted to The company is

successfully tests evaluate the ability aiming to continue

Luxembourg using green hydrogen to replace the use of further tests by

in the production of natural gas with gradually increasing

direct reduced iron at green hydrogen in the hydrogen content

one of their steel the iron ore in direct reduced iron

plants in Canada. reduction process. In production. The

this initial test, green environmental value

hydrogen replaced will be to deeply

6.8% of natural gas decarbonise steel

over the course of 24 making process by

hours, resulting in a cutting several

noticeable drop in hundred thousand

CO2 emissions. The

 green hydrogen tonnes of CO2 per

utilised in the test year.

was generated by an

electrolyser owned

by a third party and

then shipped to the

steel mill location.

SSAB The steel The blast furnaces By 2026, SSAB aims

manufacturer process traditionally to offer commercially

Sweden developed a pilot uses coal and coke to viable fossil-free steel

plant, HYBRIT, eliminate oxygen to the market. The

together with the from iron ore and environmental value

mining company produce iron. In the will be captured by

LKAB and the energy HYBRIT process, deeply decarbonising

company Vattenfall. hydrogen gas is steel industry by

intended to take the achieving fossil-free

place of coal and production. The

coke as sustainable plant in Sweden

substitutes. produced world’s

Hydrogen will first first fossil-free

be produced through sponge iron.

the electrolysis of

water using fossil-

free electricity. Solid

iron (sponge iron) is

subsequently melted

down in an electric

arc furnace. Fossil-

free pellets trial is

already completed.

Hydrogen-based

reduction and

smelting trials and

hydrogen storage

83
 installations are still

going on.

Remarks: It is evident that the steel industry is a major energy consumer and CO2 emitter.

The urgent need for decarbonising steel manufacturing is acknowledged by many. The

first question, perhaps, would be whether we aim to decarbonise the entire steel industry

or do it partly. Hydrogen is a candidate to deliver both of these aims. For the time being,

the industry trials show that the new hydrogen heating method can yield the same

quality steel. Voestalpine, Thyssenkrupp, TATA, and Dillinger/Saarstahl are other

companies that are conducting or preparing hydrogen trials at their steel plants85. The

business is in its Develop phase, and further external funding and industrial cooperation

are needed to boost it to undergo Appraisal and Upscaling phases.

5. Discussion
The businesses we reviewed here are the ones which have already passed numerous

successful pilots. The use cases which are still in the Research and Development phase

are omitted intentionally. The companies are chosen according to their expertise in their

fields after a thorough and extensive market scan. The authors attempted to compile as

many relevant companies and businesses as possible in the hydrogen economy.

However, it is impossible to present all existing valuable companies and businesses in

this paper.

The hydrogen economy is not a new phenomenon to us. There have been

attempts to incorporate hydrogen into our lives for the last 150 years. There are some

who might claim that hydrogen is hype, and the practical applications are doubtful. For

example, Joseph Room wrote his book “The Hype About Hydrogen” in 200486. The book

states that despite all the talk of hydrogen-powered fuel-cell cars dominating the

motorways in the future, gasoline-electric hybrids will continue to hold the technological

85 Bellona Europa, 2021. Hydrogen in steel production: what is happening in Europe – part one.
86 Joseph J. Room, 2004. The Hype About Hydrogen: Fact and Fiction in the Race to Save the Climate.
and environmental high ground for many decades to come (Joseph J. Room, 2004). After

almost twenty years, fuel cell vehicles remain a very small niche.

Achieving a low-carbon economy by using hydrogen in various aspects of the

economy will not be easy. The first challenge is the definition of low-carbon hydrogen.

As we mentioned earlier, there are various definitions such as low-carbon, fossil-free

and clean hydrogen; however, an international standardisation has not been achieved

yet. This means measurement, standardisation, and certification is a preliminary

condition to start discussing a low-carbon hydrogen economy. From our existing

knowledge, consultations with the experts in the field and review of the hydrogen

businesses, we can draw the following remarks:

• For now, the hydrogen economy is supply-driven.

• Many hydrogen businesses depend on external funding, primarily government

support, and the continuity of this funding and financing mechanism is questionable as

there are concerns for future incentives and government support.

• Much emphasis is given to colour coding of hydrogen production, whilst the

significant point should be to produce low-carbon hydrogen.

• Stimulation of demand for low carbon hydrogen is essential.

• Carbon pricing is a key element in the success of the hydrogen businesses and

further research on the impact of carbon pricing on the hydrogen businesses is necessary.

• Clearer policy and regulatory frameworks are necessary.

• Policy support for long-term demand creation is critical and the role of

regulations and subsidies should be discussed.

• Especially, transportation and storage of hydrogen are challenging topics.

• There are numerous pilot projects. Yet, whether these projects will convert into

sustainable businesses is questionable.

• Measurement, standardisation, and certifications are prominent subjects.

• Hydrogen infrastructure is crucial. Using just the existing gas infrastructure for

hydrogen is not viable. Additional investment is necessary.

The hydrogen economy is vast, and there are numerous other business cases that we did

not include in the study. Some additional 20 business cases that we should mention are:

Case 21: Hydrogen use in Grid Balancing

85
Case 22: Compressed Hydrogen Selling

Case 23: Fuel Cell Car Leasing

Case 24: Fuel Cell Hydrogen Bus Operating

Case 25: Fuel Cell Truck - Logistics Service Provider

Case 26: Hydrogen Application Standardisation Audit

Case 27: Hydrogen as Back-Up supply

Case 28: Oxy-Combustion of Hydrogen-Enriched Methane

Case 29: Hydrogen Consultancy

Case 30: Hydrogen Financing

Case 31: Hydrogen Flow Measurement

Case 32: Hydrogen for decarbonising explosives in the mining industry

Case 33: Hydrogen for Paper Production

Case 34: Hydrogen in the Food sector

Case 35: Hydrogen Plant Management Software

Case 36: Hydrogen Plant Modules Export

Case 37: Hydrogen Power Plant Construction

Case 38: Hydrogen Production by Recycling

Case 39: Hydrogen Purification

Case 40: Hydrogenating Oil

6. Conclusions
The hydrogen economy is a vast phenomenon with many application areas and business

cases. Each application area has its own opportunities, challenges, and alternatives.

There is no doubt hydrogen will play a role in decarbonisation and low-carbon energy

transition. However, one must admit that hydrogen alone is not “the silver bullet” as

achieving the vast energy transition will require a combination of many solutions

including hydrogen. Therefore, hydrogen must be regarded as a complimentary asset in

the wider energy economy rather than being considered as the ultimate solution.

After reviewing the 20 prominent application areas of hydrogen, we made a

qualitative assessment of spotting the market phase of the use cases according to Figure
1, the Innovation Process. The market phases will be designated as Value Creation

(Develop & Appraise), Upscaling and Value Capture (Market Diffusion). The Value

Creation phase means numerous successful pilots have been done, and additional

monetary and environmental value are sought. The appraisal of the true value and

impact of the business is completed. In the Upscaling phase the business case has started

to be bought and adopted nationally and internationally. The number of users, buyers

and sellers increases steadily. Finally, Market Diffusion means the successful

commercialisation and widespread use of the business case. At this stage, the business

reaches its maturity. It has become self-sufficient, meaning it can generate its own

revenue and is not dependent on external funding such as grants or government

incentives.

We should note that these are preliminary and subjective judgements and are

open to discussion and further evaluations. Another point is that the hydrogen business

is on the move, and the market conditions change quickly. Furthermore, the market

stages are fluid and do not have visible and strict boundaries. Moreover, the stages are

not always forward-looking. This means that a business in one stage, does not

necessarily mean that, after a period of time, it will reach the next stage. For example,

hydrogen cars were first introduced in the 1960s and Fuel Cells, and Hydrogen in the

Transport Sector have been stuck in the Upscaling phase since then. The businesses have

not reached maturity and market penetration yet.

Another crucial point is that a single business case might have subsections or

sub-sectors at different market phases. For example, even though we designated

electrolysers in the Market Diffusion phase, this is only applicable for the Alkaline

technology. PEM electrolysers can be claimed to be in the Upscaling phase, and various

other electrolyser technologies are in the Research and Development and Value Creation

phases. Figure 3 summarises the market phases of these businesses where grey parts

stand for grey hydrogen, grey methanol and grey ammonia where high-carbon

hydrogen is used in established businesses.

87
 Figure 3. Market Phases of Hydrogen Businesses

There are no distinct boundaries between market phases. As the market economy is

quite vivid, shifting between phases could happen in time. As we can see from Figure 3,

quite a few businesses have reached market diffusion. The majority of the businesses

still depend on external funding such as project funds, subsidies, grants and government

support. Achieving a self-sustaining revenue stream is a must for a business to be viable.

And the most difficult step is to shift from Value Creation to Upscaling. Some businesses

have been stuck there for decades. And some will likely fail to make that forward

transition. We can perhaps make an analogy between passing from Appraisal to

Upscaling as the “Valley of Death” from the technology hype cycle phenomenon. The

most challenging part for the business cases is to start generating self-sustaining revenue

and many businesses might fail to achieve that and become stranded in the valley of

death.

Finally, we acknowledge that exogenous factors such as regulations, subsidies

and carbon pricing will affect the viability of these businesses substantially. For example,

regulated versus non-regulated business models across the value chain will have

different characteristics. Some of the business models that we inspect here such as those

related to network infrastructure and storage are likely to be regulated whereas those

related to production and consumption are likely to be not. A regulated business model

has a fundamentally different economics compared with a market-driven business

model. Similarly, as we mentioned earlier, government support, incentives and

subsidies are vitally important especially for the initial stages of a business. On the other

hand, carbon pricing especially affects the cost of hydrogen production methods. As a

follow-up future work, we will pick up some of the business opportunities and carry out

a business model readiness level analysis. We shall carry out further qualitative and

quantitative analysis to study and underline the impact of exogenous factors and

identify conditions under which a particular hydrogen business model moves from one

stage to another.

89
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