Use Green Hydrogen in Industrial Processes

Hydrogen is typically produced using fossil fuels through energy-intensive processes that generate significant climate pollution (known as “gray” hydrogen). However, it can also be made using renewable energy to split water molecules into hydrogen and oxygen (“green” hydrogen), or by extracting it from natural gas while capturing and storing the resulting carbon emissions (“blue” hydrogen). While neither blue nor green hydrogen is currently available at scale, growing investment in the sector is expected to accelerate development and deployment.

When produced, managed, and used responsibly, hydrogen has the potential to deliver real climate benefits. But if hydrogen leaks into the atmosphere, it could reduce the climate benefits relative to fossil energy, especially in the near term.  

As the smallest molecule, hydrogen is particularly difficult to contain, with emissions occurring across the entire value chain, including production, conversion, transport, storage, and use. Once in the atmosphere, hydrogen contributes to warming by triggering chemical reactions that increase the amounts of short-lived greenhouse gases, including methane, tropospheric ozone, and stratospheric water vapor. The latest science suggests that hydrogen has about 35 times the warming power of CO₂ over 20 years and 12 times the warming power over 100 years.¹

Prioritize Green Hydrogen

Blue hydrogen is gaining traction in the U.S. because of its lower production costs and growing policy incentives. However, blue hydrogen is produced from natural gas with potentially high emissions of methane – a potent greenhouse gas that has more than 80 times the warming power of CO₂ over the first 20 years, in addition to hydrogen emissions. In fact, the 20-year warming impact of blue hydrogen pathways could be higher than that of the fossil fuels it intends to replace, if both hydrogen and methane emissions are high.² While blue hydrogen can play a role in the energy transition, ensuring its climate integrity is critical. That means addressing upstream methane emissions, minimizing hydrogen emissions, and most importantly, delivering effective carbon management. Getting carbon management right depends on three key factors: consistently high carbon capture and storage rates, safely operated and responsibly sited CO₂ pipelines and demonstrated permanent storage with high environmental integrity.³ 

Green hydrogen holds the greatest promise for decarbonizing heavy industry and other sectors where other clean alternatives are lacking – provided it’s produced with additional renewable energy that doesn’t divert clean power from the grid and robust safeguards are in place to prevent hydrogen leaks and other emissions. 

Use Hydrogen Wisely, Where It Matters 

Producing hydrogen, green or blue, is highly energy-intensive. Even when leaks are minimal, hydrogen won’t be the best choice for every application. For needs like powering cars and heating homes, clean electricity from renewable sources will often be cheaper and better for the climate than hydrogen. When replacing fossil fuels for home and road transportation, green hydrogen on average requires 3 to 7 times more energy than direct electrification.⁴

Industrial processes requiring low temperatures (such as moving machines, room heating, and air conditioning) or medium temperatures (such as food, paper, and textiles production) can often be efficiently decarbonized through electrification, while green hydrogen is better suited for high-temperature heating processes, cement kilns, and steel production.  

Produce Hydrogen Responsibly 

The electricity used to produce green hydrogen should come from new or unutilized carbon-free sources to avoid diverting clean power from more efficient uses like powering homes and cars. Electricity generation needs to be delivered within the same region and matched hourly with the hydrogen plant’s power consumption. Without this alignment, the grid may rely on fossil fuels to fill gaps, increasing overall emissions.   

Green hydrogen production also requires significant water use. Your company should evaluate the water demands of hydrogen production projects in the context of local water resource availability to mitigate negative impacts on local freshwater supplies and communities. 

Because transporting hydrogen increases the risks of leaks, it makes sense to produce it close to where it’s used. If your company is planning for hydrogen transport logistics, it’s important to consider the energy losses involved in compressing or liquefying hydrogen or converting or attaching it to and from a more transportable carrier molecule (e.g., ammonia) for long-distance transport by pipeline, truck or ship. 

Measure and Manage Hydrogen Emissions 

While green hydrogen offers significant potential to address some of the most pressing energy challenges, strong measures need to be in place to prevent hydrogen leaks and other emissions. By tracking where and how much hydrogen is being emitted, companies can take steps to prevent and mitigate emissions through smarter designs and choices.  

Companies interested in using green hydrogen should also consider supporting the following opportunities to minimize hydrogen emissions and maximize climate benefits: 

• Sensors Development: R&D for sensor equipment capable of detecting and quantifying emissions, small or large 
• Measure Emissions: Test sensor tech and support measurement campaigns 
• Minimize Emissions: Identify leakage mitigation measures, venting/purging alternatives, and best practices 
• Emissions Programs: Incorporate plans for Monitoring, Reporting, Verification and Leak Detection and Repair programs 
• Incorporate in LCAs: Incorporate hydrogen emissions and warming effects in Life Cycle Assessment calculations 

Effective monitoring technologies and mitigation techniques are becoming available, and they should be integrated early in project planning to prevent even small hydrogen losses.  

Overcome Current Cost Premiums 

Green hydrogen production currently faces high upfront costs and remains significantly more expensive than grey or blue hydrogen. Your company should assess how economies of scale and technology advancements can help bring green hydrogen closer to cost parity with traditional fossil-based methods over time. Your company should also explore the role of guaranteed offtake agreements—either directly with hydrogen producers or through consortia with other local users.  

In addition, your company should monitor and position your projects to benefit from policy or regulatory developments, such as industrial performance standards in the EU, the Carbon Border Adjustment Mechanisms in the EU and under consideration in Australia and the US, or Buy Clean programs that support public procurement of lower-carbon materials.  

To help make green hydrogen more financially viable, your company can engage in Advanced Market Commitments (AMCs)—such as through the World Economic Forum’s First Movers Coalition— to signal demand and support early adoption of hydrogen technologies. 

While green hydrogen is not yet widely available at scale, the landscape is rapidly evolving. Increased subsidy incentives, technology advancements, and expansion of renewable energy production are driving progress. By 2050, green hydrogen is projected to become the dominant source of hydrogen globally, accounting for 50-65% of the total supply.⁵ As costs decline and infrastructure grows, green hydrogen is expected to become increasingly viable for industrial applications, making now a pivotal time for companies to plan, pilot, and position themselves for future competitiveness. 

Footnotes

1. EDF | The Science of Hydrogen’s Climate Warming Effects
2. Sun, T., et al. 2024: Climate impacts of hydrogen and methane emissions can considerably reduce the climate benefits across key hydrogen use cases and timescales. Environmental Science & Technology. https://pubs.acs.org/doi/10.1021/acs.est.3c09030
3. EDF | Getting to Clean: The Carbon Capture Imperative for Blue Hydrogen
4. EDF | Rule #1 of Deploying Hydrogen: Electrify First
5. McKinsey & Company | Global Energy Perspective 2023: Hydrogen Outlook