This standpoint suggests that the revision of the EU Hydrogen Strategy should move beyond hydrogen production targets and instead focus on hydrogen’s role as a tool for industrial decarbonization. Hydrogen should not be viewed as an objective itself but rather as a means to an end within a broader portfolio of decarbonization solutions. Reducing grid emissions and expanding clean electricity for sectors where direct electrification is technically and economically feasible should generally supersede electrolytic production. This would ensure that scarce clean electricity is used in applications where it can deliver the greatest benefits, while preserving clean hydrogen for sectors where few viable alternatives exist.
This analysis identifies the industrial sectors where hydrogen is used most, including refining, fertilizers, methanol, steel, aviation, and maritime transport. For each sector, this publication examines current hydrogen consumption, projected hydrogen consumption to 2030 and beyond, the key drivers of future deployment, and the economic and industrial realities that will determine whether hydrogen can scale successfully.
The standpoint reflects on the lessons learned from the implementation of the 2020 EU Hydrogen Strategy, demonstrating the need for an evolving, targeted, and evidence-based approach to hydrogen deployment. A key standpoint is that future hydrogen demand should not be assessed in isolation from other technological innovation: Emerging electrification technologies, across different sectors, have the potential to reduce or even eliminate the need for hydrogen and its associated transport and infrastructure needs. These innovations may offer more efficient or cost-effective decarbonization pathways in certain applications and should be incorporated into future demand projections and infrastructure planning.
- Adopt a sectoral approach: Replace overarching hydrogen-volume targets with sector-specific decarbonization targets. Europe should organize policy around emissions it needs to reduce in each industry – dictating industry how to do so risks delays, inflated costs, and unnecessary constraints. Europe achieved only around 6.4% of its 2024 electrolyzer capacity target, demonstrating the need to revisit the assumptions behind the strategy.
- Concentrate scarce clean hydrogen where it is most needed. Reducing grid emissions and expanding clean electricity should generally supersede hydrogen production. Direct electrification should take priority where technically and economically feasible, ensuring that scarce clean electricity is used in applications where it can deliver the greatest benefits while keeping clean hydrogen for sectors where fewer alternatives exist.
- Rethink what Europe imports and which infrastructure it builds. Importing (intermediary) products such as hot briquetted iron, ammonia, methanol, and synthetic fuels can reduce the costs and energy losses associated with transporting hydrogen. The build out of hydrogen infrastructure should be selective and based on credible demand, avoiding the risk of stranded
- Invest in long-term innovation before committing to long-term hydrogen deployment. Emerging technologies could reduce or bypass the need for hydrogen in some industrial processes. Supporting their development and incorporating their potential into planning can expand Europe’s options and reduce the risk of unnecessary infrastructure investment.