Is ‘White Hydrogen’ the Solution to Global Decarbonization?

LOW CARBON HYDROGEN

Ongoing Commercial and implementation market Initiatives in Africa

Africa is at the forefront of the global shift toward sustainable energy, with a focus on low-carbon hydrogen initiatives gaining traction because hydrogen is the ideal replacement for fossil fuels. As an example, Europe wants to raise its reliance on hydrogen as a source of energy from 2% now to 14% by 2050, achieving 50% low-carbon hydrogen by 2030 [5R]. Africa’s enormous potential of large landmass, abundant renewable energy resources such as solar, wind, hydropower, and low labour costs can significantly reduce the cost of hydrogen production compared to other regions and make the continent a strong contender to produce a significant proportion of the world’s low carbon hydrogen requirements.

According to Norwegian energy analyst Rystad Energy, to date African countries have announced a total of 52 low carbon hydrogen projects. Combined, these projects could produce a total of 7.2 million tonnes of hydrogen by 2035, amounting to 114 GW of electrolysers. Though, to date, only 13MW have so far received a financial commitment. “The major impediment to building these mega projects and associated infrastructure will be investment.” [9R]

These low-carbon hydrogen projects are split across a number of African countries and will undoubtedly alter the dynamics of the world’s energy environment and have a direct influence on trade and business on the continent of Africa. Currently, a significant amount of the activities ongoing in Africa are focused on demonstrations of interest, feasibility studies, and national hydrogen policy formulation. The current landscape of commercial and implementation market initiatives in Africa are in Northern Africa: Mauritania, Egypt, Morocco, and Kenya; and in Southern Africa: Namibia, South Africa, and Angola. Other African countries will also be involved in the transition to low-carbon hydrogen, though it is likely that this hydrogen will be utilized domestically for energy, fuel, and industrial uses.

The Africa Green Hydrogen Alliance (AGHA) was founded in 2021 to serve as a catalyst for pan-African momentum toward low-carbon hydrogen. The member countries are Egypt, Kenya, Mauritania, Morocco, Namibia, and South Africa, with Angola joining in 2023. According to a recent report by AGHA, the European Union, the Middle East, Japan, and South Korea have been identified as priority export markets for low-carbon hydrogen. Repurposed pipelines have been highlighted as the cheapest method to transport hydrogen internationally. Due to North Africa’s proximity to Europe and existing pipelines that run from Algeria to Spain and Italy, and from Libya to Italy, exports of pure hydrogen are expected to dominate in the long term from North Africa to Europe. There is the potential for this export market to reach 17 million tons by 2050. For Namibia, South Africa, and other countries in Southern Africa, the exportation of hydrogen is expected to be through alternative means such as ammonia, methanol, or synthetic kerosene, with a similar sized market and potential to reach 13 million tons (hydrogen equivalent) by 2050. Based on AGHA’s predictions for 2050 landed costs of ammonia, multiple AGHA member countries could be among the top ten suppliers to Europe. For European exports, the lowest-cost African countries are Morocco, and Mauritania, closely followed by Egypt. In comparison, for exports to Japan, African countries South Africa, Namibia and Egypt are leading. [12R]

Ongoing low carbon hydrogen commercial and implementation initiatives range from memorandum of understanding agreements, feasibility studies, ambitious pilot projects to strategic collaborations between governments, industries, and international stakeholders. The applications of hydrogen within these initiatives range from energy transportation, vehicular and airline fuel, industrial application such as manufacture of iron and steel, grid balancing related to storing of renewable energy and agricultural uses including fertilizer. In Africa, Egypt currently has the largest green hydrogen initiative pipeline, with 21 projects amounting to 2.5 million tonnes by 2035. Morocco is in second place, with 1.6 million tonnes by 2035, followed by Mauritania, South Africa, Namibia and Angola [9R]. The African countries that currently demonstrating the most initiatives are summarized below. The countries are introduced in alphabetic order.

History of Hydrogen

Angola

Angola’s vast fossil fuel resources and abundance of water have created an opportunity for low-carbon hydrogen development in the country. Signaling its commitment to low carbon hydrogen, in late 2023 Angola also joined the AGHA, alongside the original 6 member countries. Angola has no gas network so instead, it plans to generate low-carbon hydrogen and then use a combination of hydrogen storage and conversion to ammonia to export to other countries. One such initiative includes an agreement between the Angolan-owned company Sonangol and Germany’s H2Global green hydrogen auction platform to export low-carbon ammonia. Exports of ammonia are expected to start in 2024 as part of a 10-year contract. This would potentially make Angola the first African nation to produce and export hydrogen. The detail of the project is shown in Figure 2. [2][8R]

In addition, the Angolan government and Chevron, through Cabinda Gulf Oil Co. Ltd recently signed a Memorandum of Understanding (MoU) to investigate the feasibility of a broad range of emission-related initiatives, including hydrogen generation, carbon offsets, carbon capture, and biofuels.

Types of Hydrogen

Egypt

Egypt aims to be one of the large exporters of hydrogen in Africa and it is in a strong position to achieve this. This is based on Egypt’s location as a crossroad to Africa, Europe and Asia; its control of the Suez Canal; being home to a wide range of energy intensive industries; and its leading deployment of renewable energy generation projects. In the 58^th edition of Ernst and Young’s Renewable Energy Country Attractiveness Index, Egypt was ranked 19^th(Morocco was ranked 16^th), but no other African countries were included in the top 30 countries [6R]. According to Rystad Energy, Egypt is currently leading in Africa in terms of its low carbon hydrogen initiative pipeline, with a total of 21 projects. One of these initiatives is the Masdar Ain-Sokhna project located in the Suez Canal Economic Zone. It includes the construction of an $8 billion green hydrogen plant using a 4 GW electrolyser and is expected to produce 2.3 million tonnes of low carbon ammonia annually. The details of the Suez Canal Economic Zone are given in figure 3 below.

A 2021 MoU signed between Egyptian Electricity Holding Company and Siemens Energy includes exploration of hydrogen production, storage, transportation and expansion of renewable energies [7R]. Other projects in Egypt’s hydrogen project pipeline include financing for firm Egypt Green Hydrogen SAE to construct a 100 MW electrolyser and $3.5 billion project by Saudi Arabia’s Alfanar to produce low carbon ammonia.

Kenya

Compared to some of the other African countries such as Egypt, Morocco, and Mauritania, Kenya does not yet have the same scale of hydrogen initiatives. Kenya launched its Green Hydrogen Strategy and Roadmap at the Africa Climate Summit in 2023. As part of Kenya’s Green Hydrogen Strategy, the EU agreed to invest €12m into Kenya’s renewable energy infrastructure, supporting Kenya’s plans to reach 100% renewable electricity by 2030. [14R] Though since 2022, Kenya has officiated a number of low-carbon hydrogen initiatives.

In 2022 Kenya signed a framework agreement for collaboration with an unidentified investor to produce 30GW of green hydrogen. Around the same time, a second agreement was signed with Australian company Fortescue Future Industries to construct a 300MW green ammonia fertilizer facility, starting in 2025. The facility will use existing geothermal capacity to produce hydrogen. The same FFI-Kenyan consortium is also looking to conduct two feasibility studies focused on scaling renewable energy generation, with the potential to produce and export up to 1.7 million tonnes annually. [13R]

Other low-carbon hydrogen initiatives in Kenya include the KenGen Green Hydrogen feasibility study which is intended to lead to a pilot project to manufacture green hydrogen, ammonia, and fertilizer plant [15R]. Another initiative is the Renewstable Kenya project which is a collaboration with Hydrogen de France to deploy a 180 mW photovoltaic solar farm combined with a 500 MWh hydrogen battery storage unit (Africa Business+, 2023). The Kenyan government in collaboration with Dubai-based AMEA Power company will be constructing a green hydrogen facility with a 1 GW electrolyser in the port of Mombasa. The facility will use geothermal energy to power the electrolyzer. [15R]

The Ministry of Energy of Kenya in partnership with the German Development Cooperation created a substantial report in 2022 that details the potential for green hydrogen in Kenya. The report highlights the potential to produce hydrogen and fertilizers. A number of locations were assessed, and pilot projects were suggested, including projects in Mombasa and Lake Lurkana which are shown in the figures below

Mauritania

Mauritania has the potential and is positioning itself to become a major player in the low carbon hydrogen market. This is based largely on its close proximity to Europe. It also has a national grid and energy intensive local industries including iron and steel manufacturing which could benefit from the production of low carbon hydrogen. Though Mauritania is yet to publish its green hydrogen roadmap it is working hard to develop a range of commercial agreements. [15R] According to AGHA, the landed cost of ammonia between now and 2050 could be similar for both Morocco and Mauritania [12R].

There are currently three main low carbon hydrogen commercial and implementation market projects in Mauritania namely Project Aman, Project Nour and Green Steel with ArcelorMittal, all of which are at the MoU stage. Project is Aman is a MoU between the Mauritanian government and renewable energy company CWP to develop a green hydrogen facility. The construction costs are $450 billion. Hybrid renewably powered wind and solar generators with a capacity of 30 GW will generate 110 TWh of electricity annually, producing 1.7 million tons of hydrogen. This initiative is shown in the figure below. Similarly, Project Nour is a MoU between Chariot energy company and the Mauritian government, following the completion of a feasibility study. The project could be one of the world’s largest green hydrogen plants with a potential capacity of 10 GW. Finally, state backed Société Nationale Industrielle et Minière de Mauritanie has signed an MoU with ArcelorMittal to construct a renewably powered steel manufacturing site. The project is set to produce 3.5 million tonnes of low carbon steel.

Morocco

Morocco currently has the second largest low carbon hydrogen initiative pipeline in Africa after Egypt, with a potential output of 1.6 million tonnes of hydrogen annually by 2035 [9R]. Morocco established its National Hydrogen Commission in 2019 and published its green hydrogen road map in 2021 [15R]. Morocco is located in close proximity to Europe, has an established renewable energy sector and has invested significantly to create a secure legal and financial framework to further encourage internal and international investment into its renewable energy infrastructure. In 58th edition Renewable Energy Country Attractiveness Index (RECAI) by Ernst and Young, Morocco was ranked 16^th[6R].

As early as 2005 NATO’s “Science for Peace” financed two hydrogen-based projects in Mauritania and Morocco. The project was based at two universities and harnessed the trade winds that blow along the Atlantic coast from Morocco to Senegal to drive 30 kW wind-based electrolyzers. The hydrogen generated was used for campus power back-up. Today, the Universities are offering renewable and sustainable energy programs, demonstrating their readiness to take these pilot programs and the resulting research to develop the skills of a new workforce [3R],[4R].

Other low carbon hydrogen projects in Morocco include its largest project in Amun, with an annual hydrogen generation 0.9 million tonnes of hydrogen. This project will be completed with partners CWP Global and North American firm Bechtel. The German / Moroccan Energy Partnership (PAREMA) is a project that will enable Morocco to generate hydrogen and export it to Germany. The construction of the Total Energies 10GW project is underway is expected to produce 0.7 million tonnes of green hydrogen annually from 2027. Another pilot is the OCP group demonstration project in Mzinda which is expected to generate 260,000 tonnes of hydrogen annually and is highlighted in the figure 7 below.

Namibia has the potential and is positioning itself to become a global leader in low-carbon hydrogen exports. This is largely based on Namibia’s potential to offer low-cost hydrogen. According to the AGHA, it has the lowest levelized cost for low-carbon hydrogen and hydrogen derivatives compared to the other members of the AGHA [12R]. This is in turn based on Namibia’s access to renewable energy, particularly wind and solar, and its scarce population. Namibia released its low-carbon hydrogen road map in 2022 at COP27. The strategy focuses on developing structures, frameworks, and legislation to support the development of the hydrogen industry. This is also underpinned by building knowledge through pilot projects and training [15R].

The Namibian government in collaboration with German company Hyphen Hydrogen Energy has signed a feasibility and implementation agreement for the Hyphen Tsau Khaeb Project, a $9.4 billion initiative that has the goal of producing 350,000 tons of green hydrogen a year from 5GW of renewable energy. Construction is expected to begin in 2025. The German government offered significant financial support throughout the earlier stages of the project [16R]. This initiative is shown in Figure 8 below. The Namibian government has also signed an MoU with Germany and the Netherlands for the export of low-carbon hydrogen to Europe.

Hydrogène De France (HDF) Energy, the French Power Producer launched into Africa by establishing HDF Energy Namibia in 2021. The Renewable Swakopmund (RSWK) collaboration between HDF Energy Namibia and the Namibian government is another initiative. It is set to build Africa’s first integrated solar-hydrogen project, scheduled to start in 2024 with the aim to increase local generation from 624 MW in 2020 to 879 MW by 2025 [17R]. In December 2022 HyIron Oshivela Project was given the formal go-ahead. This initiative uses employing green hydrogen with direct reduction techniques to produce reduced iron. The project is initially expected to manufacture 15,000 tonnes of directly reduced iron annually, with a potential to grow to 1 million tonnes of iron per year. The initiative is projected to avoid 1.8 million tonnes of CO₂ equivalent annually, with the potential to reduce carbon emissions on a global scale [18R].

A further pilot which is currently in the finance approval stage is a collaboration between TransNamib, Hyphen Technical, and CMB.TECH, and others to pilot hydrogen-fueled locomotive technology. The pilot project will involve the conversion of two locomotives and a supporting wagon to transport the hydrogen fuel. [2R]

South Africa

In 2021 South Africa published its hydrogen road map. The program includes potential pilot projects and feasibility studies including catalytic green hydrogen hubs, carbon capture, combining hydrogen and pollutants to make value-added products and the adoption of hydrogen fuel cells in a wide range of vehicles and buildings. The program also recommends using the existing natural gas network to transport hydrogen nationally. [10R]

Currently, within South Africa there are a number of initiatives focusing on sustainable aviation fuel (SAF) including a consortium comprising South African energy company Sasol, Linde, Enertrag and Navitas Holdings and the German H2Global auction platform [9R]. A $4.6-billion low carbon ammonia plant is planned with Hive Hydrogen at the Port of Ngqura with construction completion expected 2027, producing 0.78 million tonnes of low carbon ammonia annually. [11R]

The German government has also approved a €15 million subsidy for consortium Linde, Sasol, Enertrag and Hydregen Energy to fund the HySHiFT 200 MW electrolyser project in Mpumalanga which will use renewable hydrogen to generate e-kerosene. The Boegoebaai project is a feasibility initiative linked to South Africa’s hydrogen program. It is looking at feasibility of a green hydrogen / ammonia export hub in Northern Cape.