Green hydrogen: ‘The demand-side is the major hurdle’

As green hydrogen and derivatives production projects slowly gain traction in Latin America, spurring demand constitutes a key challenge that needs overcoming.

Regional trailblazer Chile already has a pilot plant in operation and a second is expected to enter the tendering phase this year.

Multiple projects, some targeting domestic offtakers and others aimed at the export market, have been publicly announced in the region. Work, however, is also needed to ensure there are buyers for output. 

“The demand-side is the major hurdle,” Francisca Salas (pictured), hydrogen and decarbonization program director at US company New Energy Events, told BNamericas.

“And that’s a global, not just a regional issue. Many industries that should be transitioning to H2 are not finding the incentives to do so. Meanwhile, those industries which are exploring options are all-too-often taking a cautious approach, creeping forward without the necessary urgency.”

Some projects in Chile are geared to the local mining sector, which is working to decarbonize by means such as using hydrogen instead of diesel as a fuel. In terms of exports, green ammonia is gaining traction as a carrier on account of relative ease of transport. 

On June 13-15, in Rio de Janeiro, New Energy Events is due to hold its third hydrogen congress for Latin America and the Caribbean, H2LAC 2023. The co-host is regional development bank IDB.

BNamericas will publish the full interview with Salas on Friday.