Bain & Company on the Role of Green Hydrogen in Decarbonizing Energy Systems and Industrial Processes

Bain & Company participated in the World Green Economy Summit 2024 (WGES 2024), hosted under the patronage of HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, the World Green Economy Organization (WGEO), Dubai Electricity and Water Authority (DEWA), and the Dubai Supreme Council of Energy, held on 2-3 October. The event gathered global experts and industry leaders to discuss the role of innovative technologies in accelerating the transition to sustainable energy.

Akram Alami, Middle East Head of Utilities, Aviation, and Sustainability & Responsibility practices participated in a panel, titled “The Role of Green Hydrogen in Decarbonizing Energy Systems and Industrial Processes” with experts from Holland Hydrogen Hub, Khalifa University in Abu Dhabi and CNBC Arabia, where the discussion centered on the promise of green hydrogen and its place within the broader transition to a sustainable global economy.

Alami addressed the question of whether green hydrogen is the only way to decarbonize the economy, stating that it is not a “silver bullet.” He emphasized, “While green hydrogen holds significant potential, it is still in its early stages of application beyond refining and fertilizers. The next big opportunity for green hydrogen is use in transportation, though many factors—regulatory frameworks, customer adoption, technological advances, and scaling—must align to realize this potential. Studies project green hydrogen could account for up to 30% of transportation energy, but achieving this requires major coordinated efforts across sectors.”

There are approximately 1,600 hydrogen projects globally, with 70% still in the feasibility and pre-construction stages. Much of this delay is due to the need for clearer regulatory and incentive schemes. In the U.S., for instance, the Inflation Reduction Act (IRA) has introduced a four-tier incentive scheme for hydrogen, but many projects are waiting for further clarity and support. In Europe, the focus has been on creating demand by mandating hydrogen use in sectors like transportation, where blending products such as Sustainable Aviation Fuel (SAF) is being encouraged.

The discussion at the WGES 2024 underscored that green hydrogen is not a standalone solution but a critical component in a multi-faceted approach to decarbonization.

“As we explore green hydrogen’s potential, we see that the path to a sustainable energy future requires collaboration, innovation, and a pragmatic approach to scaling the technology. The future of hydrogen is bright, but it will require careful coordination of policies, incentives, and infrastructure investments,” Alami said.

The panelists concluded by noting that green hydrogen’s future depends on overcoming existing technological and regulatory hurdles. However, with large-scale projects in the region and global momentum building, the prospects for green hydrogen are promising.