Two global oil and gas supermajors, TotalEnergies and BP, have expressed their strong confidence in green hydrogen’s prospects by announcing significant investment plans in the sector. The moves signify a growing interest in renewable hydrogen and its potential to shape the global energy economy.
BP’s recent acquisition of the largest stake in the $36 billion, 26GW Asian Renewable Energy Hub (AREH) in Australia, and TotalEnergies’ participation in India’s Adani New Industries (ANI) for a $50 billion initiative to create the world’s largest green hydrogen ecosystem, have garnered attention from industry analysts.
The prospects for hydrogen in the energy transition have been subject to varied opinions. Some see it as the magic bullet for a carbon-neutral future, while others caution that its potential is being exaggerated, with concerns that it may serve as a cover for continued fossil fuel use.
Among the debates surrounding green hydrogen are questions about the economics of large-scale remote production versus smaller local plants and the feasibility of long-distance hydrogen transportation.
Anja-Isabel Dotzenrath, BP’s Executive Vice President for Gas & Low Carbon Energy, expressed her conviction that hydrogen is set to play a significant role in the global energy landscape. She compared hydrogen to the trajectory of liquified natural gas (LNG) and projected that hydrogen could constitute 10-15% of global energy supply by 2050. BP aims to achieve a 10% share in “core hydrogen markets” as part of its broader target to reach 50GW of net renewable energy by 2030.
TotalEnergies CEO Patrick Pouyanne sees the entry into ANI as a major milestone in their low carbon hydrogen strategy. Their vision is to decarbonize hydrogen used in their European refineries by 2030 and pioneer mass production of green hydrogen to meet growing demand by the end of the decade. The company also continues to explore blue hydrogen, produced using abated fossil gas.
Prakash Sharma, a vice president at research group Wood Mackenzie, believes that the tide is turning on hydrogen investments in Asia, with major energy players increasing their focus on green investments. The recent commitments by BP and TotalEnergies demonstrate the industry’s confidence in hydrogen technology.