Data from the ICIS Hydrogen Foresight project database reveals that the announced low-carbon hydrogen production capacity climbed to approximately 17GW by 2040 as of April 2024, with 74% of this capacity expected to be online by 2035. On the demand side, ICIS Hydrogen Foresight shows future low-carbon hydrogen demand increasing by 13.8% over the six months to April 2024.
According to Jake Stones, Hydrogen Editor at ICIS: "The Dutch hydrogen market, recognised as a key location for the emergence of widespread hydrogen trade due to large-scale infrastructure potential, saw little in the way of progression of projects, with no currently announced projects advancing to FID. Despite the apparent growth, this lack of progression indicates underlying market challenges that must be addressed to fully capitalise on potential."
ICIS Hydrogen Foresight, which tracks the progression of hydrogen projects based on primary sources, noted updates across 38 supply-side projects and 21 demand-side projects, reflecting changes in nearly half of announced projects. Supply capacity grew by 777 MW (4.8%), and demand increased from 22.7 TWh to 25.7 TWh (a 3 TWh increase), with 90% of the 25.7 TWh expected to be online by 2032.
ICIS notes that economic drivers such as industrial support mechanisms and increasing clarity on targets for decarbonising energy use encourage market participants' investment proposals. However, financial challenges and regulatory uncertainties continue to dictate the pace of market development.
"Although there has been a mix of feedback from the market behind a lack in FID and project progression, a balance to this is that projects simply take time to reach such final decisions. While there are wider influences in the mix, there is also a strong level of activity and confidence in the market, as can be seen by new announcements on both supply and demand," said Daniyal Sheikh, Hydrogen Market Analyst at ICIS.
"Finally, in the case of the Netherlands, supply-side projects far outweigh currently announced demand, indicating that would-be producers could be hesitant amid high competition for securing offtake. Meanwhile, on the demand side, willingness to pay shows limited overlap with expected production costs, again a potential cause of hesitation," concluded Sheikh.