Hydrogen rollout stalls as politics, costs and realism reshape expectations

Ambitious hydrogen plans championed in 2022 have slowed, with new forecasts showing significantly lower production despite numerous pilot projects and massive future investment.

In February 2022 Germany’s chancellor and US President highlighted hydrogen as a rapid path to energy independence amid the looming Ukraine conflict. Subsequent policy shifts have tempered that optimism: the US under Donald Trump limited renewable backing, and Germany’s new government led by Friedrich Merz adopts a pragmatic, blue-hydrogen-friendly stance while fiscal pressures persist. New forecasts now predict hydrogen production in 2050 will be 35% below 2022 expectations, with clean hydrogen falling 45%, despite roughly 1,500 pilot projects worldwide and a $3.2 trillion investment outlook to 2060.

The closure of the Strait of Hormuz and other geopolitical events could accelerate final investment decisions, especially in Europe and China, though China may also turn to coal-based hydrogen. Scaling to gigawatt-scale facilities will demand systematic risk management, standardisation, and robust policy tools such as subsidies and carbon pricing to attract capital and meet decarbonisation goals.