Baku: Azerbaijan’s hydrogen production and consumption currently represent less than 0.5% of global demand, APA-Economics reports citing Azerbaijan’s National Strategic Vision on Hydrogen document published by the European Bank for Reconstruction and Development (EBRD). It was noted that the document was published by the EBRD and “Worley Consulting Group Limited” on behalf of and in collaboration with the Ministry of Energy of Azerbaijan.

According to Azeri-Press News Agency, the global hydrogen demand is currently around 90,000 KTPA, with projections indicating a substantial increase of up 60% by 2030 and up to five times by 2050. 25% of this supply is expected to be traded internationally, with the rise in demand met with clean hydrogen. “We’ve developed three scenarios for future green hydrogen and derivative demand to understand the domestic potential market for clean hydrogen based on the end users identified in Section 4 and the potential for green hydrogen exports. These scenarios consider Azerbaijan’s need to balance hydrogen’s internal benefits for decarbonization against its export value,” the document reads.

This challenge mirrors the country’s approach to natural gas and the creation of green energy corridors, which currently focus on renewable electricity. An Accelerated scenario has been developed, relying upon an accelerated rollout of renewables and international demand for clean hydrogen to increase substantially.

An Ambitious Scenario has also been developed, which pushes through to 2060 and utilizes a higher percentage of Azerbaijan’s offshore technical capacity. The scenarios outlined include a Balanced Scenario targeting 0.5 MTPA by 2050, an Accelerated Scenario aiming for 1.1 MTPA by 2050, and an Ambitious Scenario reaching 1.9 MTPA by 2060. For all scenarios, the key assumption is that Azerbaijan’s hydrogen and electricity markets will evolve like natural gas-with long-term offtake contracts.

Currently, Azerbaijan produces “gray” hydrogen, used in oil product manufacturing. Gray hydrogen is derived from natural gas and is presently the most economically affordable type, making it widely used. In contrast, green hydrogen, the most environmentally friendly type, is obtained by using electricity from renewable energy sources to split water through electrolysis.