Despite the high-profile cancellations of dozens of projects globally over the past year, low-carbon hydrogen production is still growing steadily, according to new industry data.
Investment in new clean hydrogen projects topped $110 billion in the last year, across more than 500 projects, a report by the Hydrogen Council, a lobbying group, found. That’s up from $75 billion in 2024. The greatest share of investment is concentrated in China, where the government “has made a strategic choice to give the industry massive backing and make it the next new technology they want to own and lead on,” Council CEO Ivana Jemelkova said in an interview.
Hydrogen could be a lower-carbon alternative to natural gas, and has ridden a wave of hype over the past few years. But with prices consistently uncompetitive, demand scant, and government incentives in the US and elsewhere drying up, there’s a growing perception in energy circles that the hydrogen bubble has burst.
That’s unfair, Jemelkova argues, since many more projects are moving forward than being cancelled. The biggest obstacle at this point, she said, is fluctuating policy that leaves investors uncertain about the economics of a given project. One measure that could help, a recent report from the International Energy Agency argued, is subsidies that support hydrogen purchases, rather than production.
