GCC: The world’s future leaders in the hydrogen revolution?

The energy transition is rapidly accelerating to meet climate change commitments. Global momentum towards decarbonisation means there is an urgent need to develop clean energy solutions. The number of financial institutions and investors aligning with Paris Agreement goals is only growing and trillions are expected to be invested into renewables before the decade is over. Energy-based economies across the GCC countries – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, UAE – need to plan ahead for a new, greener future.  

The world’s largest oil and gas players are already transforming their businesses to achieve a low-carbon future across production and supply chains. Furthermore, the upheaval of the past year has had unimaginable repercussions across the world, putting the clean energy transition into overdrive.  

Hydrogen could be the answer to powering our lives in the future, sustainably. Our recent global report ‘The World of Energy Post-Covid’ predicts that the decarbonisation of our economies will be largely dependent on the successful production and utilisation of hydrogen – and specifically, green hydrogen – for a range of domestic, commercial, and industrial end uses.

And if that’s the case, the countries of the GCC are at a clear advantage.

With the cheapest solar energy in the world, wind also in abundance, a deep-rooted energy economy and clear leadership ambitions, the GCC is in an enviable position to lead the world’s hydrogen production race.

Political momentum for hydrogen is growing with countries across the globe announcing hydrogen strategies, offering a unique window of opportunity for the advancement of hydrogen and ammonia markets. In fact, recent industry reports estimated that green hydrogen could generate GCC countries up to $200 billion by 2050 and create one million jobs.

The Abu Dhabi Economic Vision 2030 sets out to transform the Emirate's economy, including a reduced reliance on the oil sector over time. Diversifying will help minimise the impact of price fluctuations and other market shocks, ensuring stable and predictable growth. 

To do this, Abu Dhabi has chosen to focus on capital-intensive, export-orientated sectors where the Emirate can build a competitive advantage: enter the hydrogen opportunity. 

Building an open, efficient and globally integrated business environment is key to future success. It speaks to the enormous potential that a locally grown hydrogen industry has for Abu Dhabi and the wider UAE. 

Directly linked to this export opportunity is the need to develop infrastructure capable of supporting economic growth alongside a skilled, productive workforce. This is critical if Abu Dhabi is to establish itself as a global green hydrogen leader. Creating a high performing network of physical and digital infrastructure will undoubtedly improve wider economic performance and also create and sustain ‘next generation’ jobs in the clean energy sector. 

But the challenges to developing a large-scale green (or pink or blue) hydrogen industry aren’t insignificant. Managing the cost of production – both in terms of power ($/kWh) and capital investment – will be essential. It will require a strong capability in the implementation and integration of all forms of non-conventional power, both behind the meter and into the grid.  

At GHD, we have long recognised the need to shift to a more sustainable energy landscape, where renewables play a larger role and emissions-intensive industries move to a net zero future. We are already working on ground-breaking hydrogen studies and pilot projects across the world. Our recent state-of-the-art analysis looked at a path forward for blending green hydrogen into natural gas systems and we have also worked with bp Australia to explore the feasibility of developing an export-scale renewable hydrogen production facility. Decarbonising natural gas into blue hydrogen was the focus of our studies for our client Santos, which looked at carbon capture and the potential to pave the way towards large-scale export of hydrogen.  

Future Energy is GHD’s commitment to the energy transition; a promise to bring everything we have – interdisciplinary industry experts, global perspectives and diverse experience – to this urgent need for change and to support communities, corporates and whole countries on their mission to net zero. 
We partner with private and public sector clients to deliver services across the value chain, from origination to delivery, to contribute to a thriving clean energy future based on our deep technical and regulatory knowledge of the industry.

The global pandemic has changed everything. The way we live our lives and our views on what it means to be truly sustainable will never be the same again.

We believe that this presents a real opportunity for Abu Dhabi. Download our report to read why.