Green Hydrogen Industrial Value Chains: Geopolitical and Market Implications

Abstract

The global transition to a low-carbon economy and adopting the needed clean energy technologies at scale will significantly impact existing value chains and transform production-to-consumption lifecycles. Regulatory and business models will need to rapidly evolve to manage the resulting substantial cost challenges and dramatic shifts in stakeholder interactions while continuing to create value. Green hydrogen is likely to play a pivotal role in a carbon-free future, as its adoption will enable the decarbonization of energy-intensive industrial processes whose emissions are hard to abate through simple electrification—such as steel and cement production. However, to take advantage of the economic opportunities created by its adoption at scale, countries will need to rethink the roles they could play in a new energy landscape and define strategic industrial policies accordingly. Our research shows how successful industrial policies must reflect a country’s potential value chain positioning in future green hydrogen markets and elucidates macro geopolitical trends that could reshape international relations as countries compete for industrial leadership, market shares, and opportunities for job creation.