Challenges and Strategies in the Clean Hydrogen Market

Energy experts often highlight the ‘chicken and egg’ dilemma faced by the clean hydrogen sector, where establishing a simultaneous supply and demand in a nascent market presents significant challenges. Carlos Fúnez Guerra, the Green Hydrogen Development Manager at Iberdrola, emphasizes that successful projects hinge on early collaboration between producers and customers. He states, “It is crucial to ensure that you have an off-taker lined up before embarking on a project.”

At Iberdrola, a recognized leader in the renewable energy landscape, the development of hydrogen facilities is closely coordinated with key partners. Fúnez Guerra elaborates, “In the facility we operate today, we engage extensively with Fertiberia, our off-taker, to design the project in alignment with their specific needs.” This proactive approach not only secures demand but also tailors the project to be more effective and beneficial for both parties.

With ambitious plans to generate over 52,000 MW of renewable energy capacity by 2025, Iberdrola is keen on optimizing the logistics of hydrogen production. Fúnez Guerra asserts, “Pursuing a project without an established off-taker is not a sound strategy. It’s far more efficient to situate the facility in close proximity to the off-taker to minimize transportation costs, ultimately enhancing the project’s viability.” He concludes by underscoring that this strategy is pivotal for ensuring the long-term success and sustainability of clean hydrogen initiatives.