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Green hydrogen:

Energizing the path to net zero

Deloitte’s 2023 global green hydrogen outlook

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Foreword

When it comes to tackling climate change, the world is

rapidly moving from ambition to action. In just the past

few years, private companies, research institutions,

regulators, financiers, and governments have

accelerated in the race to decarbonize organizations,

supply chains, sectors, and, indeed, economies.

This newfound zeal finds its motivation in the very

crucible of innovation: necessity—the necessity of

tackling climate change, the necessity for energy

security, the necessity for geopolitical recalibration.

The calls for action have finally found voice. Deloitte’s

Turning Point analysis pointed to economic arguments

for action on climate change—from a regional

perspective and a global perspective. This economic and

commercial perspective has highlighted the structural

and transformative challenge of climate change and

advanced the energy transition as a necessary condition

for growth and sustainable development.

Globally, the movement toward net-zero is now broadly

acknowledged, while debate continues around the pace

and scale of change across industries and nation-states.

Yet, the crescendo of attention to the common concern

to humankind poised by climate change is juxtaposed

with a narrowing window for action highlighted by

scientists, the Intergovernmental Panel on Climate

Change (IPCC), and the international community.

At its core, a shift in the energy mix will transform

economies’ production systems. In terms of scale, it

truly can be that profound. The speed of transformation

will be dictated by the calculus of physical and economic

damages of climate change, alongside the costs to

decarbonize, influenced by the interplay of the supply

and demand of old and new energy. In the end, the

constant is an inevitability of change.

While the greatest energy mix switch will be toward

electricity from renewable sources, 15% to 30% of

future energy needs is likely to be satisfied by hydrogen,

a function of sectors that may not be able to electrify

easily (hard-to-abate sectors) and of the creation of

additional demand from new products and services—

for example, green steel. In the context of the timeframe

for the world to achieve net-zero, hydrogen, and in

particular green hydrogen, gains significant currency.

Using projections from Deloitte Economics Institute’s

Hydrogen Pathway Explorer (HyPE) model, this report

offers a comprehensive analysis of the development of

renewable hydrogen to energize the global economy

toward net-zero by 2050. The development of green

hydrogen is a key element in the transition pathway

from a high-emissions intensive energy system to a

net-zero economy by 2050.

The significance of Deloitte’s analysis—a US$1.4 trillion

market by 2050 in which green hydrogen comprises

some 85% of the hydrogen market, with 20% traded

around the world—is twofold: first, this trade is critical

to the lowest-cost decarbonization of the world

economy; second, the production and export of green

hydrogen can offer a global sustainable development

realignment for developing and emerging economies

across Africa, Latin America, and the Pacific, alongside

countries such as Australia and the United States and

regions such as the Gulf States.

This report is not a prediction—it is a plausible

scenario of how this new energy transition could

unfold based on some of the latest, credible data,

assessments, and regulatory and policy developments.

As the global economy searches for new sources of

value and a new growth path for sustainable economic

development, green hydrogen can provide a pathway

of hope and prosperity. Please join us on this global

project of decarbonization and write the chapter to

unlock the green hydrogen economy together.

Jennifer Steinmann

Global Sustainability &

Climate Practice Leader

Deloitte Global

Green hydrogen: Energizing the path to net zero | Foreword

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