Japan could face difficulties in reaching hydrogen goals: report

Lack of infrastructure development is one of the challenges it faces.

Japan has set ambitious targets for hydrogen production but the country may face difficulty in meeting these goals due to various factors such as infrastructure, according to Wood Mackenzie.

In a report, Wood Mackenzie noted Japan’s announcement to increase its domestic hydrogen production tenfold between now and 2030 and target to increase its hydrogen and ammonia production to three million tonnes per annum (mtpa) by 2030.

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Aside from resolving barriers such as high costs, lagging demand, lack of infrastructure and carbon intensity standardisation, Japan will also launch a hydrogen subsidy scheme to address the cost gap between the high cost of low-carbon hydrogen and fuel or feedstock.

“If Japan intends to attract imports, it must offer something on par with the US [$3/kgH2) and the EU (€4/kgH2),” said Principal Analyst Flor De la Cruz. “However, it is unclear if the target is for domestic production or global supply by Japanese affiliated companies.” 

Whilst 89 mpta of low-carbon hydrogen projects have already been announced, WoodMac noted that announcements in midstream infrastructure such as maritime, pipelines, and storage, amongst others have fallen behind.

“Although more details are yet to come Japan has taken a step in the right direction by revamping its hydrogen strategy to develop the entire hydrogen value chain,” De la Cruz.