Hydrogen for Chemical Industry

The chemical industry is a major global source of greenhouse gas emissions, largely due to its reliance on fossil fuels as both an energy source and a feedstock. This chapter examines the pivotal role clean hydrogen—produced via water electrolysis with renewable electricity (green) or from natural gas with carbon capture (blue)—can play in decarbonising key chemical production processes. Focusing on ammonia, methanol, and olefins, the analysis assesses the technical feasibility, economic competitiveness, and infrastructure requirements of hydrogen-based pathways. While ammonia presents the most immediate and mature opportunity for clean hydrogen substitution, its integration requires addressing the challenge of flexible operation with intermittent hydrogen supply. For methanol, achieving net-zero emissions necessitates coupling green hydrogen with biogenic or direct air-captured CO₂. The chapter further explores the critical policy and certification landscape, highlighting how rules on additionality and hourly matching are becoming key drivers for investment. Despite significant cost and infrastructure barriers, clean hydrogen is positioned as a transformative vector for the chemical sector, offering a pathway to deep decarbonisation, particularly for existing hydrogen demand, though its widespread adoption depends on continued technological progress, coordinated policy support, and the development of robust international markets for low-carbon chemicals.