IEA Global Hydrogen Review 2023: demand of 95 Mt, low-emission hydrogen still below 1 Mt

The International Energy Agency published its annual review of the hydrogen market in September 2023. The report shows that global hydrogen demand in 2022 was about 95 million tonnes, less than 3% more than a year earlier, and almost all hydrogen is produced from fossil fuels. Low-emission production – from electrolysis powered by renewable energy or from gas with CO₂ capture – remains below 1 million tonnes. Announced projects could raise it to several tens of millions of tonnes in 2030, but most of them are at an early stage.

What is changing

The report shows a gap between ambition and delivery. Governments have announced strategies and targets, but only some projects have secured financing and offtakers. The largest demand comes from refineries and the chemical industry (ammonia, methanol), while new applications – steel, heavy-duty transport, shipping – are only at the pilot stage. The Agency draws attention to the role of regulation: auctions, contracts for difference, certification standards and requirements on the use of low-emission hydrogen in industry.

In the European context the report notes that the EU has adopted one of the most extensive sets of hydrogen regulations, including the rules for RFNBO fuels and the plan for the European Hydrogen Bank.

Significance for the industry in Poland

For Poland, one of the largest hydrogen producers in the EU (mainly grey hydrogen, from natural gas), the report is a pointer that the transformation requires both technology and demand. For the biogas industry, two conclusions follow. First, hydrogen from biomass and biogas can complement the market, but its role depends on costs and sustainability criteria. Second, shared infrastructure – gas grids, storage, quality standards – will require coordination when hydrogen and biomethane are blended.

The development of hydrogen also affects the biomethane market: the two gases compete for grid access and funds, but may complement each other, for example in the methanation of CO₂.

What to pay attention to

When analysing projects, one must distinguish between fossil, low-emission and renewable hydrogen, because support and certification obligations depend on the classification. It is also worth checking whether the reported "announcements" have secured financing.

Why the report's figures must be read with caution

Project announcements are not investment decisions. In many countries the portfolio of announced investments is many times larger than what actually has financing and offtakers secured. For the hydrogen market this means a risk of delays and revised plans. The biogas industry, which already has operating installations and well-known technologies, can in this context show an advantage in the form of ready, predictable sources of renewable gas.

What next

The IEA will monitor the delivery of projects and the development of policies. For the EU, the first auctions of the European Hydrogen Bank and the final rules of the gas and hydrogen package will be key.