Raw material costs are one of many burdening factors, according to the Hydrogen Council.
The costs for the production of green hydrogen have risen significantly this year, as reported by the Hydrogen Council, an association of more than 130 companies such as platinum producer Anglo American and Siemens Energy, and consulting firm McKinsey. In the period up to June 2023, the price rose by 30 to 65 percent to up to USD 6.50 per kilo. The reasons for this development are manifold. The reasons for this development are manifold. Firstly, the technology for producing sustainable hydrogen through electrolysis is very capital-intensive, making the industry very sensitive to the global rise in interest rates, increasing the cost of raising new capital. In addition, there are rising costs for raw materials such as rare earths, which in turn are needed for the renewable energy sources that supply the electricity for the electrolyzers.
In some countries, the lack of skilled workers and interrupted supply chains are also obstacles. Overall, however, the Hydrogen Council is confident. The price of green hydrogen is expected to fall to between 2.5 and 4 US dollars per kilo by 2030. To achieve this, the necessary steps must be taken today, as the consulting firm Roland Berger recently called for. Not only political will is needed, but also a secure supply of the raw materials that are essential for the technology.