The Breakthrough That Could Make Green Hydrogen Cost-Competitive

Green hydrogen has long been seen as a solution for hard-to-decarbonise sectors like steel, shipping and heavy transport. But high costs and efficiency challenges have kept most projects on the drawing board — fewer than 10% of announced projects were operational by 2023.

Hydrogen’s appeal is clear. It delivers high-temperature heat, produces only water vapour, and can be stored and used on demand. Yet green hydrogen has typically cost three to five times more than fossil-fuel-based alternatives, limiting real-world adoption.

That may be about to change.

Researchers from China Agricultural University and Nanyang Technological University have developed a new production method using sugars from agricultural waste instead of oxygen during electrolysis. The result? Green hydrogen produced for as little as $1.54 per kilogram — potentially cheaper than fossil fuels.

The process also creates a valuable by-product (formate), improving efficiency and further reducing costs. If scalable, this breakthrough could finally close the economic gap between green hydrogen and natural gas.

However, affordability alone doesn’t make hydrogen the answer everywhere. As IRENA has warned, renewable energy must be used wisely — and green hydrogen should be deployed where direct electrification isn’t possible.

With the right applications and innovations like this, green hydrogen may finally move from promise to reality.