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Three scenarios for hydrogen production in Azerbaijan revealed

20 February 2025 13:26 (UTC +04:00)

Azerbaijan's hydrogen production and consumption currently represent less than 0.5% of global demand, APA-Economics reports citing Azerbaijan’s National Strategic Vision on Hydrogen document published by the European Bank for Reconstruction and Development (EBRD).

It was noted that the document was published by the EBRD and "Worley Consulting Group Limited" on behalf of and in collaboration with the Ministry of Energy of Azerbaijan.

According to the document the global hydrogen demand is currently around 90,000 KTPA, with projections indicating a substantial increase—up 60% by 2030 and up to five times by 2050. 25% of this supply is expected to be traded internationally, with the rise in demand met with clean hydrogen.

"We've developed three scenarios for future green hydrogen and derivative demand to understand the domestic potential market for clean hydrogen based on the end users identified in Section 4 and the potential for green hydrogen exports. These scenarios consider Azerbaijan's need to balance hydrogen's internal benefits for decarbonization against its export value," the document reads.

This challenge mirrors the country's approach to natural gas and the creation of green energy corridors, which currently focus on renewable electricity.

An Accelerated scenario has been developed, relying upon an accelerated rollout of renewables and international demand for clean hydrogen to increase substantially.

An Ambitious Scenario has also been developed, which pushes through to 2060 and utilizes a higher percentage of our offshore technical capacity.

Balanced Scenario 0.5 MTPA - 2050

Accelerated Scenario 1.1 MTPA - 2050

Ambitious Scenario 1.9 MTPA - 2060*

For all scenarios, the key assumption is that Azerbaijan's hydrogen and electricity markets will evolve like natural gas—with long-term offtake contracts.

Note that Azerbaijan currently produces "gray" hydrogen, which is used in oil product manufacturing.

Gray hydrogen is derived from natural gas and is currently the most economically affordable type of hydrogen, making it widely used.

On the other hand, green hydrogen is the most environmentally friendly type. It is obtained by using electricity from renewable energy sources to split water through electrolysis.