Fueling the Future: Green Hydrogen’s Global Start and Vietnam’s Path

Green Hydrogen: A Global-Scale High-Stakes Gamble

Global hydrogen demand is projected to exceed 200 million tons by 2030, yet less than 1% currently comes from renewable sources. Green hydrogen, produced via electrolysis using renewables, plays as a key pillar of decarbonization heavy industries like steel, chemicals, and transport. Major economies—the EU, U.S., China, and India—are investing in hydrogen hubs, electrolysis capacity, and trade partnerships to drive costs below $2/kg by 2030. Yet, infrastructure gaps and policy fragmentation remain hurdles (IRENA, 2020).

Southeast Asia: Between Potential and Practicality

The ASEAN Center for Energy projects that hydrogen within the ASEAN region “can significantly strengthen the energy security of ASEAN Member States (AMS) by reducing their dependence on fossil fuels imports.” Southeast Asia’s hydrogen demand grew from 3.27 million tons in 2015 to 3.75 million tons in 2021, driven by ammonia production (Australian Government, 2024). However, without carbon pricing or subsidies, ASEAN markets may struggle to compete until at least 2040, especially when neighbors such as Australia has been ready with a National Hydrogen Roadmap in 2019. (Deloitte, 2023).

Vietnam’s Hydrogen Vision: Bold Potential Beyond Risks

To meet climate goals and net-zero 2050, Vietnam plans to produce 100,000–500,000 tons of hydrogen annually by 2030, scaling to 10–20 million tons. Offshore wind resources, estimated at over 600 GW, could support large-scale production.

The Direct Power Purchase Agreement (DPPA) pilot program, allowing businesses to buy renewable energy directly from generators, is a key policy shift to accelerate industrial hydrogen adoption by enabling cost-effective electricity sourcing (Deloitte, 2023).

Moreover, with strong solar capacity, Vietnam is in great chances for exclusive Solar – Green Hydrogen production and export. As of 2021, nearly 47% of global hydrogen production was derived from natural gas, 27% from coal, 22% from oil, and only about 4% from electrolysis, with a mere 1% produced using renewable energy (Green Hydrogen).

Strategic Priorities for Real Impact

Studies by IRENA and Deloitte highlight key enablers:

Policy & Incentives: Carbon pricing, Contracts for Difference (CFD), and production subsidies for GH2 financial viability.
Infrastructure Development: Investments in pipelines, liquefaction, and storage for scaling the GH2 market.
Localized Manufacturing: ASEAN nations’ emphasize on domestic electrolyzer production to reduce dependence on imports.
Targeted Applications: Green hydrogen could first replace gray hydrogen in industries like steel and ammonia production before expanding to heavy transport and grid applications.

References:

[1] GREEN HYDROGEN COST REDUCTION SCALING UP ELECTROLYSERS CLIMATE GOAL H 2 O 2. (n.d.). Retrieved March 25, 2025, from https://www.irena.org/-/media/Files/IRENA/Agency/Publication/2020/Dec/IRENA_Green_hydrogen_cost_2020.pdf

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[2] Green hydrogen: Energizing the path to net zero. (n.d.). Retrieved March 25, 2025, from https://www2.deloitte.com/content/dam/Deloitte/sg/Documents/about-deloitte/sg-about-green-hydrogen-energizing-the-path-to-net-zero.pdf

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