Traditionally reliant on gasoline for transportation fuel, should Pakistan contemplate a shift

towards Hydrogen as a fuel in the future? Please propose a framework for its implementation.

Introduction & Background:

Green hydrogen presents a sustainable and clean energy solution for the future, harnessing the
power of renewable energy sources through electrolysis. With the global demand for
hydrogen already evident, reaching 95 million tons in 2022 primarily sourced from fossil
fuels, green hydrogen stands out not only for its environmental benefits but also for its ability
to revolutionize industries and transport by substantially lowering emissions, underlining its
importance in the battle against climate change. Moreover, as the infrastructure for green
hydrogen grows and production costs decline, this 100% clean solution, which leaves water as
its only byproduct, becomes increasingly viable for widespread adoption, offering a
transformative alternative for fuel, energy efficiency, and combating greenhouse gas
emissions.

The transition towards green hydrogen, despite its potential for sustainable development,
faces significant challenges, primarily the shift of the current hydrogen production from
hydrocarbons to a greener pathway that avoids releasing around 830 million tons of carbon
dioxide annually. This shift would necessitate a staggering 3600 TWh of electricity, eclipsing
the annual electricity generation of the entire European Union, and underscores the pressing
need for investment in renewable energy infrastructure and technology such as electrolysis
and fuel cells, to meet the energy efficiency and clean energy goals integral to this transition.
This adoption across the transport sector and across industries promises a cleaner, sustainable
future, underscoring the pivotal role of green hydrogen in advancing global sustainable
development and innovation in alternative, renewable energy sources.

Pakistan's Current Energy Landscape

Pakistan's energy landscape is characterized by a heavy reliance on fossil fuels, with a

significant portion of its energy mix dominated by imported sources. This reliance presents
both challenges and opportunities for the country's energy future:

• Primary Energy Mix: Approximately 85% of Pakistan's current primary energy mix
is dominated by fossil fuels, including imported RLNG, coal, and RFO. This heavy
reliance on fossil fuels not only contributes to environmental pollution but also places

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 a significant financial burden on the country due to the costs associated with importing
these resources.
• Installed Power Generation Capacity: Pakistan has an installed power generation
capacity of 39,000 MW. The breakdown of this capacity is as follows:
• Thermal (Fossil Fuels): 66%
• Hydro: 24%
• Renewable (Wind, Solar, and Bagasse): 6%
• Nuclear: 4%

This distribution highlights the country's current dependence on thermal energy

sources and underscores the potential for growth in the renewable energy sector.
• Renewable Energy Potential and Government Initiatives:
• Wind and Solar Power: The Sindh wind corridor alone has the potential to
generate 50,000 MW, showcasing the vast untapped potential of renewable
energy resources in Pakistan. Over the last five years, 20 wind power projects
(1,180 MW) and six solar power projects (418 MW) have commenced
commercial operations, indicating a growing shift towards renewable energy .
• Government's Renewable Energy Target: The government aims to derive
20-30% of all energy from renewable sources by 2030, reflecting a
commitment to diversifying the country's energy mix and reducing its
dependence on imported fossil fuels 5.
• Investment in Solar Energy: The World Bank's commitment of $100 million
for solar energy projects in Sindh is a significant step towards harnessing
Pakistan's solar energy potential 5.
• Promotion of Waste-to-Energy Projects: The government's promotion of
waste-to-energy generation projects further demonstrates its intent to explore
alternative energy sources that can contribute to a more sustainable and self-
reliant energy future for Pakistan.

These points collectively illustrate Pakistan's current energy landscape, marked by a

significant reliance on imported fossil fuels but also showing promising signs of a shift
towards renewable energy sources. The government's targets and the ongoing investments in
renewable energy projects are indicative of Pakistan's potential to transform its energy sector,
making it more sustainable, environmentally friendly, and less dependent on imported fuels.

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Understanding Hydrogen as a Fuel

Green hydrogen emerges as a beacon of sustainability and innovation in the field of

renewable energy, offering a multitude of benefits alongside certain challenges. Its
production, applications, and potential implications for industries and the environment form a
complex yet promising landscape.

Production and Characteristics:

• Electrolysis: Green hydrogen is produced by splitting water into hydrogen and

oxygen through a process called electrolysis, with electricity sourced from renewable
energy, ensuring zero greenhouse gas emissions throughout the process.
• High Energy Density: It possesses a high energy density, which makes it an ideal
candidate for long-term energy storage and as a fuel for energy-intensive processes.
• Versatility: Hydrogen is versatile and can be produced from various sources. It is
found in water and fossil fuels and can be generated using different methods like
electrolysis, steam reforming, and fermentation.

Applications and Advantages:

• Industrial Use: It can serve as a fuel for industrial processes, such as metal
processing and glass manufacturing, and replace fossil fuels in carbon-intensive
industries, significantly reducing emissions.
• Transportation: Hydrogen-powered vehicles emit only heat and water, offering a
cleaner alternative to fossil fuels, and can travel further on a full tank compared to
electric vehicles.
• Energy Storage: Due to its storage potential, green hydrogen can effectively
supplement intermittent renewable energy sources like solar and wind, making it an
excellent solution for renewable energy storage.

Challenges and Considerations:

• Safety and Material Compatibility: Hydrogen has a wider flammability band than
natural gas, making it more prone to ignition. Exposure to hydrogen can cause
embrittlement in materials like steel and iron, leading to their failure .

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 • Transport and Storage: The low density of hydrogen poses significant challenges for
its storage and transport, requiring innovative solutions to overcome these barriers.
• Cost and Infrastructure: Despite its potential, the high cost and logistical
complexity of hydrogen production, storage, and transportation are major hurdles to its
widespread adoption. However, the green hydrogen market is projected to grow,
indicating a positive trend towards cost competitiveness and infrastructural
development.

In summary, green hydrogen represents a transformative energy vector with the potential to
decarbonize multiple sectors and contribute significantly to sustainable development. Its
production through renewable sources, coupled with its high energy density and versatility,
positions green hydrogen as a future fuel. Nonetheless, addressing safety concerns, material
compatibility issues, and the logistical challenges of storage and transport will be crucial for
its successful integration into the global energy landscape.

Global Shifts Towards Hydrogen Fuel

The global shift towards green hydrogen as a fuel is driven by its potential to revolutionize the
energy sector, offering a sustainable and inclusive alternative to traditional fossil fuels. This
transition is underscored by several key developments:

• Market Growth and Investment:

• The green hydrogen market was valued at USD 1320.19 million in 2022, with
projections indicating a growth to USD 16091.56 million by 2028, at a CAGR
of 51.7%.
• An estimated investment of USD 700 billion is required across the hydrogen
value chain to facilitate this growth, highlighting the significant financial
commitment towards green hydrogen development.
• The Green Hydrogen Catapult initiative aims to develop 45GW of electrolyzer
capacity by 2026, showcasing global commitment to scaling up green
hydrogen production.
• Technological Advancements:
• Electrolysis, a key technology for sustainable hydrogen production, is expected
to see its market value increase from USD 154 billion in 2022 to USD 219
billion by 2026.

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 • The cost of green hydrogen production is anticipated to decrease by around
50% through 2030, making it increasingly competitive with traditional energy
sources.
• Global Impact and Potential:
• Over 30% of hydrogen is projected to be traded internationally by 2050,
surpassing the current share of natural gas, which indicates the potential for a
more democratic and inclusive hydrogen market.
• The mobility sector, as the largest adopter of green hydrogen, accounted for
58% of the total market in 2022, demonstrating the significant role of hydrogen
in transforming the transport industry.
• Clean hydrogen demand (green and blue) could surge to 500-600 metric tons
by 2050, from a demand of around 94 million tons of mostly grey hydrogen in
2021, emphasizing the shift towards more sustainable hydrogen sources.

These developments signal a profound shift in the global energy landscape, with green
hydrogen at the forefront of this transformation. The anticipated growth in the green hydrogen
market, combined with technological advancements and the potential for significant
geopolitical and geo-economic shifts, positions green hydrogen as a key player in achieving
climate neutrality and fostering sustainable development worldwide.

The Potential for Hydrogen in Pakistan

Pakistan's journey toward embracing green hydrogen as a future fuel source is underpinned by
its abundant natural resources and the urgent need to transition to cleaner energy systems. The
potential for green hydrogen in Pakistan spans across various sectors, leveraging the country's
rich solar and wind resources, and aligning with global efforts to combat climate change.

Sector-Wide Applications and Benefits:

• Renewable Energy Sources: Utilizing Pakistan's vast solar and wind resources, green
hydrogen can be produced through electrolysis, ensuring a sustainable and zero-
emission fuel source.
• Industrial Applications:
• Chemical Industry & Industrial Heating: Green hydrogen serves as a clean
alternative for processes requiring high-grade heat .

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 • Cement and Steel Production: These high carbon-emitting industries can
significantly reduce their carbon footprint by integrating green hydrogen into
their operations.
• Transport and Energy Storage:
• Fuel Cell Vehicles (FCVs): Adoption in the transport sector can drastically
lower emissions, contributing to improved air quality.
• Energy Storage: Green hydrogen can store excess renewable energy,
addressing the challenge of energy storage during low demand periods.

Innovative Projects and Infrastructure Development:

• Green Hydrogen Plant: Pakistan's first-ever green hydrogen plant, inaugurated in

February 2021, marks a significant step towards harnessing solar energy for hydrogen
production, with a capacity of 60 kg of hydrogen per day.
• Value Chain Projects: Initiatives such as Hydrogen Electrolysis from Ghazi-Barotha
Dam, Solar-Powered Hydrogen Production at Quaid e Azam Solar Park, and the Run-
of-the-River Hydropower Micro-Grid illustrate the country's commitment to exploring
diverse sources for green hydrogen production.

Challenges and Strategic Recommendations:

• Financial Feasibility: High capital expenditure and elevated electricity costs

currently pose significant barriers. Policy interventions, such as reviewing power
pricing tariffs and providing low-cost power for hydrogen generation, are crucial.
• Infrastructure Development: The need for developing hydrogen refueling
infrastructure and reducing the cost of low carbon hydrogen production is evident.
Collaborations, like the one between Oracle Power, China Electric Power Equipment
and Technology (CET), and Shanghai Investigation, Design and Research Institute
(SIDRI), aim to establish a hybrid renewable power plant in Sindh, enhancing green
hydrogen and ammonia production capabilities.

In conclusion, the potential for green hydrogen in Pakistan is vast, offering a pathway to
reduce dependence on imported fossil fuels, save foreign exchange reserves, and meet climate
change commitments. With strategic investments and policy support, Pakistan can overcome
existing challenges and position itself as a leader in green hydrogen production in the region.

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Barriers to Hydrogen Adoption

The transition towards green hydrogen in Pakistan faces several barriers that can impede its
widespread adoption. These challenges span across technical, economic, and infrastructural
domains, each requiring specific strategies for mitigation:

Economic and Financial Hurdles:

• High Capital and Operational Costs: The initial investment for green hydrogen
projects is notably high, with production costs ranging between $3 and $6 per
kilogram. To achieve a more competitive price point of around $1.5/kg, a fourfold
reduction in the cost of industrial-scale electrolyzers is necessary.
• Elevated Electricity Costs: Producing 1 kg of hydrogen requires at least 50 kilowatt-
hour (kWh), emphasizing the need for affordable electricity from renewable sources to
make green hydrogen economically viable 7. Additionally, the high cost of
infrastructure, including production facilities and storage systems, further strains
financial feasibility.
• Market Dynamics: Currently, green hydrogen is the most expensive type of
hydrogen to produce, with costs fluctuating between $5.5/kg and $9.5/kg. The
conversion and transportation of hydrogen add to the expense, potentially limiting its
demand in the absence of a specific hydrogen development strategy.

Technical and Infrastructural Barriers:

• Storage and Transportation: Hydrogen's low volumetric energy density complicates

its storage and transport, requiring advanced solutions for safe and effective
distribution. Hydrogen pipelines and storage tanks are significantly more expensive
than those for natural gas, adding to the infrastructural cost.
• Safety and Material Compatibility: The wider flammability range of hydrogen
poses safety risks, while exposure to hydrogen can cause embrittlement in materials
such as steel and iron, leading to potential failures. Ensuring safe production,
transportation, and utilization necessitates the establishment of comprehensive safety
measures and protocols.

Policy and Regulatory Framework:

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 • Lack of Comprehensive Policy: Pakistan's current energy landscape lacks a
dedicated policy and regulatory framework to support the development, deployment,
and utilization of green hydrogen technologies . This gap hinders the strategic
planning and execution of hydrogen projects, limiting the ability to address other
challenges effectively.
• Public Acceptance and Standards: The expansion of hydrogen infrastructure
requires widespread public acceptance, which can be challenged by safety concerns
and the lack of technical and international standards for green hydrogen . Establishing
clear and encouraging policies, alongside increasing public awareness, is crucial for
overcoming these barriers.

Addressing these barriers requires a multi-faceted approach, involving strategic investments,

policy reforms, and technological advancements. By tackling these issues head-on, Pakistan
can pave the way for a more sustainable and energy-independent future with green hydrogen
at its core.

Proposed Implementation Framework for Pakistan

To establish a robust framework for the implementation of green hydrogen projects in

Pakistan, a multi-faceted approach involving collaboration, policy development, and strategic
investments is essential. The following outlines key components of the proposed framework:

1. Collaborative Projects and Employment Opportunities:

• The collaboration between Pakistan and China on the green hydrogen project
in Thatta, Sindh, is a pioneering step towards clean energy transition, expected
to generate direct employment for approximately 6,000 individuals, with an
additional 2,000 benefiting from indirect employment opportunities . This
project underscores the importance of international partnerships and local job
creation in green hydrogen initiatives.
2. Policy Development and Financial Support:
• Green Hydrogen Policy and Framework: NEECA's initiative to seek
technical assistance for the development of a Green Hydrogen Policy and
Framework for Pakistan from International Development Partners is a critical
step towards creating a conducive environment for green hydrogen projects.

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 • Funding and Investment: The willingness of the United Nations Industrial
Development Organisation (UNIDO) to extend $14 million funding for clean
hydrogen projects demonstrates the availability of financial support for early-
stage development. Additionally, the significant investor interest of around
$4.3 billion in Green Hydrogen projects in Punjab indicates strong market
confidence and the potential for large-scale investment in the sector.
3. Strategic Recommendations for Implementation:
• Infrastructure and Renewable Energy Integration: Projects offering
Renewable Energy (RE) infrastructure should be prioritized to ensure the
sustainable production of green hydrogen. This includes leveraging Pakistan's
solar and wind resources for electrolysis.
• Collaboration and Research: A collaborative effort between academia,
government, and the private sector is crucial for scaling up green hydrogen
production. This collaboration should focus on industrial-scale production,
policy support, incentives, and funding, alongside the development of
necessary infrastructure.
• Regulatory Framework and Incentives: Developing a supportive regulatory
framework is essential for the growth of the green hydrogen sector. Policy
interventions, such as reviewing power pricing tariffs, providing low-cost
power for hydrogen generation from curtailed hydropower, and implementing
a CO2 emissions cost, are recommended to enhance the economic viability of
green hydrogen projects.
• Hydrogen Refueling Infrastructure: The development of hydrogen refueling
infrastructure is vital for the adoption of hydrogen in the transport sector.
Policy and regulation will play a significant role in facilitating the
establishment of this infrastructure, ensuring the accessibility and convenience
of hydrogen fuel for consumers.

By addressing these components, Pakistan can lay the groundwork for a successful transition
to green hydrogen, positioning itself as a leader in clean energy innovation and sustainable
development in the region.

Conclusion

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Throughout this essay, we've explored the transformative potential of green hydrogen in
Pakistan, underlining its significance in the shift towards sustainable energy solutions and
climate change mitigation. The discussion highlighted how green hydrogen, produced via
electrolysis using renewable resources, could redefine Pakistan's energy landscape by offering
a cleaner, viable alternative to fossil fuels across various sectors including industrial processes
and transportation. Moreover, the global trends and projected market growth for green
hydrogen accentuate its pivotal role in the future of energy, with technological advancements
and investment surges marking a clear path toward its widespread adoption and cost
competitiveness.

Looking forward, the journey of integrating green hydrogen into Pakistan's energy framework
requires overcoming numerous challenges, yet the opportunities for economic, environmental,
and social benefits far outweigh these hurdles. Strategic investments, comprehensive policy
frameworks, and international collaborations are essential to unlock the full potential of green
hydrogen, not just as an alternative fuel source but as a cornerstone for Pakistan's sustainable
development and energy independence. As we stand at the cusp of this green revolution, the
concerted efforts toward research, development, and implementation of green hydrogen
solutions could position Pakistan as a regional leader in clean energy innovation.

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