Hydrogen Considerations Tree: Executive Deck

This initiative responds to growing requests from Missions and country partners to address hydrogen-related considerations in strategy, policy, and investment decisions. The partnership seeks to build understanding and capacity among USAID Missions and country partners to make informed decisions about hydrogen and its derivatives. Hydrogen is a versatile energy carrier that can be produced via electrolysis using electricity from renewable energy sources, such as wind and solar, or nuclear energy. It can also be found naturally in geologic reserves, produced from gasification of biomass, or other conventional production pathways. Electrolysis of water using 100% renewable energy produces zero direct carbon emissions. Hydrogen can be used in various sectors of the economy, including the transport sector, refineries, fertilizer production, chemical production, steel, cement kilns, and other industrial applications. Greenhouse gas emissions from hydrogen production vary based on the energy sources and production pathway. The color-coded chart illustrates the different energy sources and production modes, ranging from natural geologic formations to nuclear energy and coal. The chart highlights the importance of considering the energy source and production pathway when evaluating the environmental impact of hydrogen production. Demand and willingness to pay for clean hydrogen vary with end use. The willingness to pay, or price cap, for clean hydrogen in various current and emerging sectors, including production, delivery, and on-site conditioning, is influenced by factors such as production costs, energy intensity, and hydrogen content. Most clean hydrogen projects today focus on ammonia and sustainable fuel production, with a growing interest in green ammonia as a near-term opportunity for the deployment of clean hydrogen. Green ammonia offers several advantages, including high energy intensity and hydrogen content, liquification at near room temperature, and existing infrastructure for domestic market and trade. However, key considerations include the low Technology Readiness Level (TRL) of dynamic operation and cracking, non-competitiveness with conventional sources, and the toxic and corrosive nature of ammonia. As production costs of low-carbon hydrogen decrease and alternative low-carbon options become limited, its competitiveness will expand across various applications.