Energy Transition in 2022

The future of green and blue hydrogen

The targets have been set for hydrogen as a fuel of the future in Europe. But can funding and support do enough to drive adoption?

PlayStart Watching

Subscribe Today

By Ralph Ibendahl and James Agnew
Published June 6, 2022 | 2 min watch
Share This Article Share to LinkedInShare to TwitterShare to Email

Key Points

  • There are 30 countries with hydrogen strategies in place, but 130 countries that have net-zero targets.
  • Current hydrogen strategies cover public funding of $75bn, but if the largest 225 projects all happened, that would require $300bn.
  • Private funding needs to be mobilised to help hydrogen succeed, but that won’t happen without further government support.
  • While strategic investors are already showing an interest, the market needs to mature to multiple hundred millions in capital per transaction.

Green hydrogen could significantly aid European countries in reaching their net-zero targets, but there’s a lot of work and investment that needs to happen first. While there’s about 70 million tons of grey hydrogen today, the amount of green hydrogen, produced by using renewable energy to power electrolyzers, is minimal. There are 30 countries with hydrogen strategies today, but 130 countries have net-zero targets and only 13 of the 30 have targets for electrolyzers.

For hydrogen to become a viable alternative to natural gas, governments need to establish stable funding for storage and for electrolyzers. As with early renewables, there’s significant risk in hydrogen projects today, particularly because of limited demand. But low-carbon hydrogen is still a nascent technology and Ralph Ibendahl, Head of EMEA Energy Transition, Europe, expects the investor universe to change quite materially over the next few years.

"Strategic players are currently taking a leadership position in developing green and blue hydrogen projects… And private equity markets are following."

Ralph Ibendahl, Head of EMEA Energy Transition, Europe


There are currently three dedicated hydrogen funds deploying capital in the hydrogen space. But the average ticket size is only about double-digit millions today. As the market increases and matures, this will increase to multiple hundred millions of capital per transaction and significant numbers of additional investors will be needed to invest in the sector.

Stay Informed

Get the latest insights from RBC Capital Markets delivered to your inbox.