Hydrogen has been part of the energy conversation for decades. Early discussions often positioned this source of energy as a universal solution for decarbonisation, given that the only emission from its combustion is water vapour. However, it is likely to make the greatest contribution in sectors where energy alternatives remain limited.
Refining already uses hydrogen at scale, while fertiliser production relies on hydrogen to produce ammonia. Steel is emerging as another important application where hydrogen is used in direct reduction processes that can replace fossil fuels. Shipping is also moving towards hydrogen-based fuels, while aviation remains at a relatively early stage of development.
Nevertheless, scaling these applications will depend on several factors. Green hydrogen, produced using renewable electricity, can offer very low lifecycle emissions. However, it remains significantly more expensive to produce vis-à-vis conventional hydrogen in many markets. Even as electrolysers, which split water into hydrogen and oxygen, become more efficient, renewable power costs, water availability, storage, and transportation continue to influence project economics.
Hydrogen’s low volumetric energy density also creates logistical challenges. It must often be compressed, liquefied, or converted into carriers such as ammonia, adding to complexity and cost. Pipelines, storage facilities, export terminals, and refuelling infrastructure are expanding in many regions, but they need to grow alongside production capacity as part of an integrated ecosystem.
Along with infrastructure investments, policy support for hydrogen remains strong as countries continue to pursue broader energy transition goals. Companies are also investing in production projects, export infrastructure, and new hydrogen supply chains.
As hydrogen projects scale, attention will increasingly shift from production to operations. Modern digital technologies like artificial intelligence (AI), advanced analytics, and digital twins can help operators optimise assets and improve planning. They can also predict maintenance needs and track carbon intensity across the hydrogen value chain. Over time, these capabilities could help create a more connected hydrogen market by improving coordination between producers, infrastructure operators, and industrial users.
Hydrogen has an important role to play in the energy transition, but it does not have to do everything. Its value lies in solving problems that other alternatives cannot address as effectively. The opportunity now is to move from individual projects to a scalable network that creates value across the energy chain. The challenge is to make the entire ecosystem technically sound and commercially viable.
Joseph Alemchery
SVP & Business Head- Energy Next – Infosys
