UNDP Resident Representative in China Beate Trankmann delivers opening remarks at the 2021 Hydrogen Industry Conference

 

On behalf of the United Nations Development Programme, I am delighted to speak to you at our third Hydrogen Industry Conference in Foshan. I had the privilege to experience first hand in my last two visits how this city is leading the way in developing a fuel cell & hydrogen economy as a vital building block to transitioning to low carbon development. I very much regret that I am unable to join you in person this year due to COVID restrictions.

Following the COP26 climate summit last month, the world is still on a precarious trajectory. We have made some progress with the latest commitments from countries lowering global warming projections closer to 2.0°C by the end of the century. However, we must be much more ambitious to keep the target of 1.5°C within reach, beyond which the consequences for our planet and life as we know it will be severe.

Here in China, it will be critical to continue building on the momentum from the important  2030/60 carbon pledges put forward by President Xi and China’s updated commitments under the Paris Agreement. To this end, fully harnessing the potential of hydrogen will be key as it can offer zero carbon solutions to help transform high-emissions sectors. 

One pioneering example is in China’s transport sector where hydrogen fuel cell vehicles have been piloted in cities across the country over the past 5 years. Currently around 8,000 FCVs have been produced. However, China’s Hydrogen FCV Technology Roadmap 2.0 sets a target of 1 million FCVs by 2035, indicating the need for far greater scale.

Moving forward, it will be critical to expand FCV production and indeed the hydrogen economy as a whole. This will require policy instruments and coordinated investments across the entire hydrogen value chain.

Here, I would like to highlight 3 important steps to bridge current deployment gaps and accelerate the adoption of hydrogen as a clean fuel in energy systems:

 

First, we must strive to make hydrogen cleaner and cheaper.

Renewable energy is already a less expensive source of power than fossil fuels in many parts of China. However, under its 2030 pledge, only 14% of China’s total expected hydrogen demand of 37 million tons, would come from renewables. Policy incentives aimed at encouraging renewable-based hydrogen production could be a game changer for the industry and push it towards a greener direction.

In addition, while low-cost renewable based electricity is necessary for green hydrogen to be competitive, investment costs for elec-tro-ly-sis facilities must also fall significantly. This will require electro-lyser stacks to be manufactured en mass, with improvement in their operating efficiency, as well as optimization of the supply chains for the key materials used in their production.

With lower costs, the demand for green hydrogen will increase, which will in turn require the manufacturing of more electrolysers operating for longer hours. The result is a virtuous cycle that can help catalyze an exponential expansion of China’s hydrogen economy.

 

Second, we must boost innovation and investment, and push for research and development and the fast industrialization of critical technologies.

The green hydrogen value chain faces significant challenges to being fully commercialized. Accelerating technology breakthroughs must be at the heart of China’s hydrogen strategies. This requires directing greater investment towards developing storage and distribution technologies: including storage materials, high-pressure cylinders, and necessary infrastructure.

According to IEA, globally around USD 90 billion of public investment needs to be moblised to complete a portfolio of demonstration projects by 2030 for a net zero pathway, and half of it would need to be dedicated to hydrogen related technologies. Emerging demand will also require rapid expansion of infrastructure: 173 hydrogen refueling stations have been built in China, connecting existing industrial clusters in northern and southeastern regions, but this number must continue to grow. It is also of vital importance to nurture professionals for this value chain. With support from UNDP, Nanhai has become a pioneer in establishing China’s first hydrogen vocational training institution.

 

Third, we must enhance international cooperation to nurture a global hydrogen economy at scale.

As of October this year, globally, the announced electrolyser project pipeline had reached over 260 GW. While some countries are working together to pilot green hydrogen projects, more efforts are needed to set a solid foundation for the entire world to harness hydrogen-based solutions for decarbonising their economies.

To this end, we need to bolster technical cooperation on scaling up renewable-based hydrogen production by channelling investments, conducting joint research and development, and collaborating on pilot programmes. It is also critical to align international standards for what is considered green hydrogen so that it can be traded as a commodity across countries and continents the same way oil and gas is today – without the cost of heating our planet.

At today’s Conference, we aim to spark dialogue and collaboration on the expansion of China’s green hydrogen economy, and inspire further commitments from all stakeholders in the hydrogen value chain.

I hope to see more concrete actions towards these goals not only in China, but on a global scale. It is everyone’s shared responsibility to align our activities with a net-zero future.
I thank you all and send my best wishes for a very successful conference.

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