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Sentiment is high towards hydrogen as an energy source

The Russo-Ukrainian war’s impact on global energy markets has amplified interest in the search for new energy sources. While hydrogen has been discussed as an alternative green energy for some time, this new urgency around energy security has brought the conversation to the fore

Hydrogen appears to be riding high on a wave of positivity, against the backdrop of the war in Ukraine and the challenge for improved energy security. Indeed, not only is hydrogen being discussed as an alternative to fossil fuels to provide power for the domestic population, but it is also being looked at as a fuel source for vehicles and aircraft.

Clean hydrogen is gaining interest

Despite such enthusiasm, only a very small percentage of global hydrogen is produced using renewable processes that don’t involve fossil gases. Regardless of its scarcity, the International Energy Agency (IEA) reports that clean hydrogen is gaining widespread political and business interest. So much so that the IEA is encouraging governments to invest in infrastructure and technological development to make hydrogen more easily available.

alva’s analysis of the discussion around hydrogen that took place in the UK media in 2022 shows that the industry has benefited not only from both an improvement in sentiment towards hydrogen, but also an increase in visibility.

Technology developments drive positivity

Technological development has driven a surge in positivity towards hydrogen. The leaders of this quarter’s sentiment rankings generated positivity by launching public-facing initiatives that take hydrogen out of the domain of technical innovation and into the broader national conversation.

Leading the sentiment scores is Doosan, whose partnership with Southern California Gas on a hydrogen-powered drone pilot for gas networks provides a salient example of an initiative which has gained strong sentiment rankings. Similarly, Air Products gained a high sentiment score after forging a 15-year green hydrogen supply deal with Go-Ahead for hydrogen fuelled electric buses – a story which was featured in The Times.

Other innovative initiatives of interest included TotalEnergies joining Masdar’s UAE green hydrogen and SAF project; and Fortescue partnering with Airbus on green hydrogen development.

Visibility is driven by partnerships

Whilst innovation stories boost sentiment for hydrogen leaders, high visibility is generated by companies engaging in partnerships – particularly where there is an energy security angle.

Toyota has been the most visible company in the hydrogen discussion, thanks to partnerships aimed at accelerating the introduction of green hydrogen. It has already begun deploying hydrogen powered ambulances for the NHS by helping to accelerate the UK’s emergency services transition to more sustainable and reliable technologies.

Shell and Uniper have both made meaningful strides forward in introducing hydrogen into the UK’s industry and transport sectors. Shell recently partnered with Hyundai car manufacturers to develop efficient hydrogen powered electric vehicles, whilst also announcing its intention to directly invest £20-25bn in expanding green hydrogen infrastructure in the UK over the next decade.

Meanwhile, Uniper generated high visibility thanks to its plans to expand its hydrogen storage facilities in Kent to make it more widely available for direct energy use.

Negative sentiment towards hydrogen

Very few companies in the hydrogen sector experienced negative sentiment, with Snowy Hydro being the only company to generate a negative score in the discussion of hydrogen. This was due to the controversial Kurri Kurri gas-fired plant, in which the addition of hydrogen to the plant was criticised as being too expensive.

However, less favourable conversations around hydrogen exist, and are highly visible. Paul Domjan, Founder and CEO of Enoda, commented in the Financial Times that despite the potential for hydrogen as a clean fuel, reaching net zero carbon with a hydrogen economy is “beyond the visible horizon”. There is significant criticism that despite hydrogen’s potential, it will take too long to put in place to have an impact on the current energy situation.

Despite such viewpoints, negativity rarely extends to companies involved in hydrogen. While there are doubts about the viability of hydrogen as a replacement for fossil fuels, innovation and partnerships in the field are almost universally well-received.

The future is looking bright for hydrogen

Overall, sentiment has been strongly positive for companies involved in hydrogen, and is likely to remain positive or improve as investment into technology begins to be more widely used in industry and transport.

This can be seen in the strong scores for green investors such as Breakthrough Energy Catalyst and FiveT Hydrogen. Hydrogen powered vehicles are celebrated as a good alternative to pure electric powered vehicles which suffer from reliability issues and concerns over sourcing of battery materials.

Green hydrogen’s market share is predicted to keep increasing and becoming more profitable as technologies become better refined for practical use. Scepticism towards the consistency of public support for the green hydrogen sector is currently very low, with almost no impact on most companies operating within the sector. Therefore, we may conclude that the future is looking bright for the reputation of the hydrogen industry.

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