Can Green Hydrogen Be Financed With Project Finance?

Green hydrogen is a popular topic in today’s energy sector and is expected to play a key role in the world decarbonization process. At present, low efficiency is a major barrier for green hydrogen commercialization. Significant investments, including government subsidies, are needed to accelerate technology breakthroughs and improve the hydrogen energy conversion efficiency. The U.S., Canada, and Europe have a series of policies to support green hydrogen development, which provide market participants with incentives to invest in projects aiming at large-scale and efficient production of green hydrogen. We believe project finance can play an important role in scaling the green hydrogen market. Project finance will be a viable financing option for green hydrogen projects in the future when they can generate stable, predictable, and sustainable revenue streams and offer bankable offtake schemes.