Podcast Summary: Energy Gang – Does low-carbon hydrogen still have a future? (Pre-ADIPEC 2025 Preview)

Date: October 13, 2025
Host: Ed Crooks (Wood Mackenzie)
Guests:

• Pierre-Etienne Franc (Chief Executive, HY24)
• Alex Tancock (Chief Executive, Intercontinental Energy)

Episode Overview

This special preview episode explores the current reality and future outlook for low-carbon hydrogen as a tool for decarbonization, coinciding with the lead-up to the ADIPEC 2025 energy conference. Ed Crooks speaks with two industry leaders to cut through the recent negative headlines and discuss where the low-carbon hydrogen industry stands today, in which sectors it is most likely to succeed, the ongoing challenges it faces, and how international dynamics—especially China and the Middle East—are shaping its trajectory.

Key Discussion Points & Insights

1. Industry Snapshot: Facts vs. Negative Headlines

• Recent Negative News: There has been a wave of cancelled projects, scaled-back ambitions, and threats to policy support, particularly in the US; a sharp slowdown in new project announcements has fed industry pessimism.
• Reality Check (04:00–06:24):
  • Fast Deployment: Total value of projects passing FID jumped from $10bn to $100bn in five years—twice the pace of early renewables.
  • Project Attrition: Cancellations only account for ~3%—the majority of projects are moving ahead.
  • Technology Scale: Electrolyzer project average size has jumped from 1 MW (2020) to 100 MW (2025).
  • Regional Leadership: Asia (especially China and India) and the Middle East are leading; US and Europe are lagging for regulatory or policy reasons.
  • Quote (Pierre-Etienne, 06:10):

    “The dynamic is not negative, it's just back to normal. People were overexcited and overpromising, and now only the serious players are in the game. The projects now are far better—stronger, simpler, faster, closer to FID with big players.”

2. The Hype Cycle and Market Maturation

• Emergence Mirrors Other Sectors (06:33–08:16):
  • Industry sees the typical 'hype-expectation-disappointment-reality' cycle, just like the Internet or initial renewables.
  • Quote (Alex, 06:37):

    “There's always the hype. You get an explosion of creativity and then the market does what it does best, which is creative destruction. The strongest and quality players come through.”

  • Recent Resilience: Despite some headwinds (COVID, supply chain), cost curves for renewables and electrolysis now resuming their downward trend.

3. Where Low-Carbon Hydrogen Makes the Most Sense

• Primary Markets (09:13–11:52, 13:31–15:13):

  • Obvious Switchers: Sectors already using grey hydrogen (refining, fertilizers) will shift with the right regulations, especially in Europe, India, China.
  • Hard-to-Abate Sectors: Steelmaking is key—hydrogen for green steel is already becoming viable.
    • Cost Impact: Adds €100–200/ton to green steel; only a small increase on final products like cars.
  • Emerging Applications:
    • Ammonia as fuel in Asia (coal plant feedstock in Korea/Japan).
    • E-fuels (SAF, e-methanol, maritime fuels): Both opportunity and challenge, with cost premium still high.
  • Transportation: Hydrogen complements EVs for heavy, medium, light-commercial vehicles, especially where batteries' space, weight, and charging times are problematic.
    • Quote (Pierre-Etienne, 12:20):

      “Hydrogen brings something battery cannot match... a complementary source of energy which is not dependent from the grid deployment.”

• Scale Perspective (Alex, 13:37):

  • If all current wind/solar were devoted to green steel, we could just decarbonize the steel sector—demonstrating the scale of the challenge.

4. Project Location & Business Models

• Optimal Geographies (15:13–17:46):

  • Large-scale hydrogen projects need world-class solar AND wind resources to maximize electrolyzer utilization.
  • Australia and the Middle East are prime due to resource quality, land, investment climate.
  • LNG model is analogous: Export hydrogen/derivatives from resource-rich to resource-poor markets.

• Business Model Evolution (18:13–19:32):

  • Both export (as ammonia, methanol, etc.) and domestic/offsite offtake are needed.
  • Projects are structured modularly: a single large site, built in ‘Lego-block’ phases, enabling repeated cost reductions and brownfield efficiencies.

5. Economics & the Price Premium Challenge

• Acceptable Premiums and Regulation (22:03–25:13):

  • Some markets (steel, ammonia) can tolerate the green premium; others (e.g., aviation fuels) face cost multiples.
  • Regulation, standardization, and synchronized global action are necessary to level the playing field and prevent carbon leakage.
  • Behavioral Changes: For some sectors, higher prices (e.g., in aviation) may drive demand reductions in rich countries.

• Cost Targets—Are We Chasing $1/kg? (25:48–27:49):

  • $1/kg hydrogen is NOT essential for competitive projects today.
  • Real-world offtake contracts clear at higher pricing, especially in the 2030s.
  • Quote (Alex, 25:48):

    “A dollar is not remotely needed to get these projects off the ground... History shows we drive down costs relentlessly.”

• Subsidies Still Play a Role:

  • Fossil fuels are still subsidized more than hydrogen or renewables, underlining the case for support in the hydrogen sector’s early days.

6. Major Challenges & What Needs to Change

• Top Three Challenges (28:24–31:16):

  1. Cost Reduction: Get green hydrogen to €3-4/kg to compete, driven by scale and low financing costs.
  2. Supply Chain & China’s Role: China leads in cost and technology; partnerships must ensure value and tech-sharing.
  3. Regulatory Certainty: Especially in Europe, regulatory lag is holding back investment and project pipeline buildout.
  • Safety is Non-negotiable (not discussed in detail but noted as baseline).

• China’s Strategy (32:02–33:21):

  • Unlike solar/wind, hydrogen technology manufacturing is more automated, so labor isn’t the main differentiator.
  • Future will favor local co-development, value-chain participation, and mutual tech sharing, rather than pure export dominance.

7. Scaling, Automation, and the Supply Chain

• Cost-Reduction Via Scale & Automation (33:42–35:46):
  • Massive projects reduce per-unit costs.
  • Automation in both manufacturing and site build-out is transformative.
  • Quote (Alex, 34:31):

    “If you do not have a China supply chain strategy, I don't know how you survive in the future. ... Factories without people...way ahead of anything I've seen in the West.”

8. Looking to ADIPEC 2025 – Priorities and Expectations

• Middle East’s Pivotal Role (36:13–37:43):

  • The region is critical as a future low-cost supplier/exporter.
  • Investors like HY24 remain ready to back the best projects, asserting hydrogen’s strategic value—even against potential backsliding in US/Western policies.
  • Middle Eastern producers will ‘win either way’ but should double down on building clean energy credentials.

• Themes to Watch (37:56–38:56):

  • Turning ambition into action
  • Cross-border and cross-sector collaboration: global partnerships will drive the next phase of market maturation.

Notable Quotes & Timestamps

• “The dynamic is not negative, it’s just back to normal ... Only the serious players are in the game.”
  – Pierre-Etienne Franc, (06:10)

• “The doom is greatly exaggerated.”
  – Alex Tancock, (06:54)

• “Hydrogen brings something battery cannot match...a complementary source of energy which is not dependent from the grid deployment.”
  – Pierre-Etienne Franc, (12:20)

• “A dollar ... is not remotely needed to get these projects off the ground ... I think it's a mix of technology driving ultimately with scale. ... All industries get a bit of help.”
  – Alex Tancock, (25:48)

• “If you do not have a China supply chain strategy, I don't know how you survive in the future.”
  – Alex Tancock, (34:31)

Important Segments & Timestamps

| Segment | Timestamp | |--------------------------------------------------|--------------| | Introductions / Company Overviews | 00:00–03:17 | | State of the Industry / Negative News | 03:17–08:16 | | Market Applications for Low-Carbon Hydrogen | 08:16–15:13 | | Project Geography & Business Models | 15:13–19:32 | | Price Premium & Economics | 22:03–27:49 | | Key Challenges Ahead (Cost/China/Regulation) | 28:24–33:21 | | Automation and Supply Chain Scale-Up | 33:42–35:46 | | Priorities for ADIPEC 2025 / Global Collaboration| 36:13–38:56 |

Tone & Language

The tone is factual, pragmatic, and occasionally wry—especially when addressing industry misconceptions or overhyped doom. Both guests are optimistic but realistic, focusing attention on scale, technology, and international collaboration.

Conclusion

The episode underscores that while the low-carbon hydrogen industry has moved beyond the hype and faces tangible market/regulatory challenges, it remains on a rapid growth trajectory. Success will depend on matching the right applications to hydrogen’s strengths, scaling up with smart business models, cost reductions (especially with China’s help), and clear, supportive regulation. The Middle East, China, and global energy collaboration will be key themes at ADIPEC and beyond.