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Global Energy Outlook 2024:Peaks or Plateaus?AGlobal Energy Outlook 2024:Peaks or Plateaus?Daniel Raimi,Yuqi Zhu,Richard G.Newell,and Brian C.PrestReport 24-06 April 2024Resources for the FutureiAbout the AuthorsDaniel Raimi is a fellow at Resources for the Future(RFF)and a lecturer at the Gerald R.Ford School of Public Policy at the University of Michigan.He works on a range of energy policy issues with a focus on tools to enable an equitable energy transition.He has published in academic journals including Science,Science Advances,Environmental Science and Technology,Journal of Economic Perspectives,Review of Environmental Economics and Policy,Energy Research and Social Science,and Energy Policy,in popular outlets including The New Republic,Newsweek,Slate,and Fortune,and quoted extensively in national media outlets such as CNN,NPRs All Things Considered,New York Times,Wall Street Journal,and many more.He has presented his research for policymakers,industry,and other stakeholders around the United States and internationally,including before the US Senate Budget Committee and the Energy and Mineral Resources Subcommittee of the US Houses Natural Resources Committee.In 2017,he published The Fracking Debate(Columbia University Press),a book that combines stories from his travels to dozens of oil-and gas-producing regions with a detailed examination of key policy issues.Yuqi Zhu joined RFF as a senior research associate in 2022 after receiving his masters degree in public policy from the Harvard Kennedy School.Prior to graduate school,he worked in corporate development at Liberty Media,a media and communications holding company in Denver.Richard G.Newell is the president and CEO of RFF,an independent nonprofit research institution that improves environmental,energy,and natural resource decisions through impartial economic research and policy engagement.He has held senior government appointments as the Administrator of the US Energy Information Administration and as the Senior Economist for energy and environment on the Presidents Council of Economic Advisers.Dr.Newell was previously the Gendell Professor of Energy and Environmental Economics at Duke and Director of its Energy Initiative and is now adjunct professor.He has published widely on the economics of markets and policies for climate change,the clean energy transition,and technology innovation.He is a board member or advisor at the National Academy of Sciences Climate Security Roundtable,the Euro-Mediterranean Center on Climate Change,the National Petroleum Council,and several other institutions and co-chaired a formative National Academies study on the social cost of greenhouse gases.Newell holds a PhD from Harvard and an MPA from Princeton.Brian C.Prest is an economist and fellow at RFF specializing in the economics of climate change,energy economics,and oil and gas supply.Prest uses economic theory and econometrics to improve energy and environmental policies by assessing their impacts on society.His recent work includes improving the scientific basis of the social cost of carbon and economic modeling of various policies around oil and gas supply.His research has been published in peer-reviewed journals such as Nature,the Brookings Papers on Economic Activity,the Journal of the Association of Environmental and Resource Economists,and the Journal of Environmental Economics and Management.His work has also been featured in popular press outlets including the Washington Post,the Wall Street Journal,the New York Times,Reuters,the Associated Press,and Barrons.Global Energy Outlook 2024:Peaks or Plateaus?iiAcknowledgements We thank Stu Iler,who initially developed the platform for harmonizing outlooks.We are also grateful to Laura Cozzi and Davide DAmbrosio at the IEA,April Ross at ExxonMobil,Christian Mollard at Enerdata,Astrid Nvik at Equinor,Michael Cohen and Jorge Blazquez at bp,Georgios Bonias at Shell,and the EIA macroeconomics and emissions team for providing data and responding to questions in the preparation of this report.Richard G.Newell conceived of the project;Daniel Raimi and Yuqi Zhu led data collection and harmonization;and Daniel Raimi led data analysis and drafting of the report,with the exceptions of Sections 3.1(Yuqi Zhu)and 3.2(Brian C.Prest).All authors reviewed and approved of the final draft.About RFFResources for the Future(RFF)is an independent,nonprofit research institution in Washington,DC.Its mission is to improve environmental,energy,and natural resource decisions through impartial economic research and policy engagement.RFF is committed to being the most widely trusted source of research insights and policy solutions leading to a healthy environment and a thriving economy.The views expressed here are those of the individual authors and may differ from those of other RFF experts,its officers,or its directors.Sharing Our WorkOur work is available for sharing and adaptation under an Attribution-NonCommercial-NoDerivatives 4.0 International(CC BY-NC-ND 4.0)license.You can copy and redistribute our material in any medium or format;you must give appropriate credit,provide a link to the license,and indicate if changes were made,and you may not apply additional restrictions.You may do so in any reasonable manner,but not in any way that suggests the licensor endorses you or your use.You may not use the material for commercial purposes.If you remix,transform,or build upon the material,you may not distribute the modified material.For more information,visit https:/creativecommons.org/licenses/by-nc-nd/4.0/.Resources for the FutureiiiCoal,oil,and natural gas consumption reach their highest points before 2030 but remain high through 2050 in many scenarios.Achieving international climate targets will require all three fossil fuels to decline much more quickly,resembling a peak,not a plateau.Although they are controversial for a variety of reasons,carbon dioxide removal(CDR)technologies are deployed rapidly and at scale in every scenario that limits global warming to 1.5C or 2C by 2100.This suggests the need for the development of robust monitoring,reporting,and verification standards,along with additional measures to prevent CDR from creating major new environmental or social challenges.Projected demand for energy-related metals and minerals grows rapidly,particularly under Ambitious Climate scenarios,rising by orders of magnitude for some critical minerals.Such growth raises new questions over supply costs,geopolitics,local environmental impacts,and more.At COP28 in the UAE,22 nations pledged to triple nuclear energy capacity by 2050.Achieving this goal at the global level would require a return to growth rates not seen since the 1980s.Since 2010,global nuclear energy production has declined by nearly 5 percent,due primarily to plant closures in Europe,Japan,and the United States.Projected energy demand in China has been revised downward substantially in recent years,reflecting a declining population and major economic headwinds.Coupled with new policies concerning air quality and climate change,these trends are contributing to lower projected coal use and carbon dioxide emissions in the decades ahead.HighlightsGlobal Energy Outlook 2024:Peaks or Plateaus?ivContents1.Introduction 12.Key Findings 33.In Focus 133.1.Chinas Evolving Energy Future against a Foreboding Economic Outlook 133.2.Emerging Technologies for Achieving Net Zero 173.2.1.Hydrogen 173.2.2.Carbon Capture,Use,and Storage(CCUS)and Direct Air Capture(DAC)193.2.3.Back to the Future(of the Past)203.3.A New Era of Mining 213.3.1.Cobalt 223.3.2.Copper 233.3.3.Lithium 243.3.4.Nickel 253.3.5.Other Minerals 264.Data and Methods 274.1.Harmonization 295.Statistics 31References 40Global Energy Outlook 2024:Peaks or Plateaus?11.IntroductionThe future of the global energy system is deeply uncertain,and the choices that are made in the coming years will have enormous consequences for the future of the climate and,indeed,human civilization.To understand how our energy system is changing,each year a variety of organizations produce long-term projections that imagine a wide range of futures based on divergent visions about policies,technologies,prices,and geopolitics.Because these projections vary widely and depend heavily on their varied assumptions and methodologies,they are difficult to compare on an apples-to-apples basis.In this report,we apply a detailed harmonization process to compare 16 scenarios across eight energy outlooks published in 2023,as well as two historical data sources.Taken together,these scenarios offer a broad scope of potential changes to the energy system as envisioned by some of its most knowledgeable organizations.Table 1 lists the historical datasets,outlooks,and scenarios examined here,and additional detail is provided in Section 4.Table 1.Datasets,Outlooks,and Scenarios Examined in This ReportSourceDataset or outlookScenario(s)YearsGrubler(2008)1Historical18001970IEA(2022)2Historical19702021bp(2023)3Energy Outlook 2023New Momentum,Accelerated Transition,Net ZeroTo 2050EIA(2023)4International Energy Outlook 2023ReferenceTo 2050Enerdata(2023)5EnerFuture 2023EnerBase,EnerBlue,EnerGreenTo 2050Equinor(2023)62023 Energy Perspectives Walls,BridgesTo 2050ExxonMobil(2023)72023 Global OutlookReferenceTo 2050IEA(2023)8World Energy Outlook 2023Stated Policies(STEPS),Announced Pledges(APS),Net Zero Emissions by 2050(NZE)To 2050OPEC(2023)9World Oil Outlook 2023ReferenceTo 2045Shell(2023)10Energy Security ScenariosArchipelagos,Sky 2050 To 2100Resources for the Future2A brief description of our methodology is provided in Section 4,with select indicators in Section 5.For the full methodology and interactive graphing tools,visit www.rff.org/geo.Throughout the figures included in this report,we use a consistent labeling system that distinguishes among the different types of scenarios(see Table 2):For Reference scenarios,which assume limited or no new policies,we use long-dashed lines;this set comprises Reference scenarios from the US Energy Information Administration(EIA),Enerdatas EnerBase,ExxonMobil,and OPEC.For Evolving Policies scenarios,which assume that policies and technologies develop according to recent trends or the expert views of the team producing the outlook,we use solid lines;this set comprises bp New Momentum and IEA STEPS.Although they do not follow the same sets of assumptions,we also include Equinor Walls and Shell Archipelagos because their CO2 emissions trajectories are similar to those in other Evolving Policies scenarios.In addition,we include Enerdatas EnerBlue and IEAs APS,which assume governments implement their nationally determined contributions(NDCs)under the Paris Agreement;for these,we use dot-dash lines.Ambitious Climate scenarios are not designed around policies but instead are structured to achieve specific climate targets.For those that limit global mean temperature rise to below 2C by 2100(bps Accelerated Transition and Enerdatas EnerGreen),we use short-dashed lines.For scenarios designed to limit global mean temperature rise to 1.5C by 2100 or net-zero emissions by 2050(bp Net Zero,Equinor Bridges,IEA NZE,and Shells Sky 2050),we use dotted lines.Figures and tables in this report sometimes refer to regional groupings of East and West.Table 3 defines those regional groupings.Table 2.Legend for Different Scenario TypesReferenceEvolving policiesAmbitious climate EIA bp New Momentum bp Accel.Transition(2C)Enerdata Enerbase IEA Steps Enerdata EnerGreen(2C)ExxonMobil Equinor Walls bp Net Zero(1.5C)OPEC Shell Archipelagos Equinor Bridges(1.5C)Enerdata EnerBlue IEA NZE(1.5C)IEA APS Shell Sky 2050(1.5C)Table 3.Regional Definitions for“East”and“West”“East”Africa,Asia-Pacific,Middle East“West”Americas,Europe,EurasiaGlobal Energy Outlook 2024:Peaks or Plateaus?32.Key FindingsAt the 28th Conference of the Parties(COP28)to the United Nations Framework Convention on Climate Change held in Dubai,world leaders agreed to“transitioning away from fossil fuels in the energy system.”11 Some advocates,governments,and civil society figures have critiqued this agreement and argued instead for the total phaseout of fossil fuels to achieve long-term climate goals.However,all scenarios examined here,including those consistent with limiting warming to 1.5C by 2100,show substantial global fossil fuel consumption through at least 2050,suggesting that a phaseout is not a prerequisite to achieving international climate goals.As we have noted in previous Global Energy Outlooks,12 world primary energy demand has experienced a series of energy additions,not energy transitions,with newer technologies such as nuclear,wind,and solar building on top of incumbent sources such as biomass,coal,oil,and natural gas.To achieve international climate goals and limit warming to 1.5C or 2C by 2100,a true energy transition is needed.But does achieving such goals require phasing out fossil fuels entirely?The scenarios we analyze in this report suggest that the answer is no.Like most scenarios published in recent years by the Intergovernmental Panel on Climate Change(IPCC),13,14 fossil fuel use declines but remains substantial through midcentury and beyond,even under scenarios that limit warming to 1.5C.Several Ambitious Climate scenarios show global fossil fuel use of roughly 100 quadrillion British thermal units(QBtu)in 2050,slightly higher than total US primary energy demand.The wide range of projected fossil fuel demand also highlights the deep uncertainty of the future of the world energy system,with 2050 scenarios spanning 487 QBtu,roughly equivalent to global consumption of fossil fuels in 2022.Figure 1.Global Fossil Fuel Demand Peaks and Declines Rapidly in Ambitious Climate ScenariosNote:Includes primary energy demand for coal,oil,and natural gas.Historical data from Shell.Resources for the Future4If fossil fuels are not phased out of the energy system,limiting warming to international climate targets implies a substantial scale-up of carbon removal technologies,including direct air capture(DAC),bioenergy with carbon capture and storage(CCS),and nature-based solutions,all of which will require robust monitoring,reporting,and verification.Although these technologies are controversial for a variety of reasons,their application at scale is an essential tool in reaching net-zero emissions in every Ambitious Climate scenario examined here.In 2022,roughly 42 million metric tons of CO2 were captured by CCUS infrastructure around the world.Although this accounts for just 0.1 percent of annual global CO2 emissions,it also represents a near tripling of CCUS since 2010,a compound average annual growth rate(CAAGR)of 8.7 percent.Under Evolving Policies scenarios,comparable CAAGRs emerge through 2050,ranging from 8.2 percent(IEA STEPS)to 12.5 percent(bp New Momentum).Under Ambitious Climate scenarios,however,CCUS deployment increases by more than two orders of magnitude by 2050,growing by 14-to 16-fold,or a CAAGR of 19 to 20 percent.Are these growth rates achievable?Technically speaking,the answer is yes.CCUS infrastructure and underground storage reservoirs are more than adequate to handle these volumes of CO2.15 However,the future costs of deploying these technologies,including to relatively novel sectors such as electric power generation(most CCUS today is used in the industrial sector),16 are not well understood.In addition,CCUS technologies are controversial and may be unwelcome in some regions,in large part because they may not reduce,and in some cases may exacerbate,emissions of other air pollutants from point sources.17 They also do not reduce water pollution or other consequences of fossil fuel extraction,transportation,refining,and combustion.Figure 2.World Carbon Capture,Use,and Storage Rises Sharply in Ambitious Climate ScenariosNote:Historical data from IEA.All scenarios except those from Equinor exclude nature-based solutions such as afforestation and reforestation.Global Energy Outlook 2024:Peaks or Plateaus?5As the global economy becomes more energy efficient,world primary energy demand grows slowly or declines under almost all scenarios examined here.This trend is seen most clearly in Ambitious Climate scenarios,where aggregate energy demand declines by as much as 33 percent(Equinor Bridges).Falling energy demand occurs primarily in high-income countries,with continued growth in energy consumption in many low-income nations.Some scenarios,such as the IEAs NZE,highlight how expanding access to modern energy services in low-income regions can be consistent with declining global energy demand and achieving long-term sustainability goals.Coal demand declines relative to 2022 in every scenario examined here,ranging from 2 percent(EIA)to 93 percent(Equinor Bridges)lower by 2050.Similarly,oil demand is lower at the end of the projection period for all but four scenarios,where it grows slowly.Liquids demand,which incorporates biofuels,increases by 2050 in six scenarios(EIA,EnerBase,ExxonMobil,IEA STEPS,OPEC,and Shell Archipelagos).Projections for natural gas demand are more mixed,with roughly half showing growth and half showing reductions.Under all Ambitious Climate scenarios,global gas demand falls considerably,ranging from a drop of 59 percent(bp Net Zero)to 78 percent(EnerGreen and IEA NZE)relative to 2022 levels.Wind and solar grow faster than any other sources in percentage terms under all scenarios,but with a wide range.For example,EIA projects global wind energy to roughly triple over the projection period,the most bearish scenario.Evolving Policies scenarios such as IEA STEPS show wind growing 5-fold,while solar grows more than 10-fold.Under Ambitious Climate scenarios,solar and wind together rise from 2 percent of the energy mix in 2022 to roughly one-third or more by 2050.Figure 3.World Primary Energy Demand Grows Modestly or Declines Under Most ScenariosNote:Projections are ordered from highest to lowest demand for fossil fuels.Historical data from IEA.“Liquids”includes oil only for Enerdata scenarios.“Biomass”excludes biofuels,which are included in“Liquids.”OPEC projections are for 2045.“Other”includes wind and solar for Equinor and OPEC.Resources for the Future6Over the last 40 years,the carbon intensity of the worlds primary energy mix has remained roughly flat,declining modestly from 2010 through today.In the decades ahead,carbon intensity is projected to continue this modest decline under Reference and most Evolving Policies scenarios.Achieving ambitious climate goals,however,will require an unprecedented reduction in the carbon intensity of energy.From 2010 through 2021,global carbon intensity of primary energy fell by a CAAGR of 0.4 percent.This decline accelerates under all scenarios,ranging from a low of 0.6 percent on average annually(EIA)to a high of 12.8 percent or more on average annually from 2022 to 2050(Equinor Bridges and IEA NZE).Is there recent precedent for such rapid reductions in carbon intensity at a national or regional scale?Unfortunately,the answer is no.The United States,South Korea,and the UK respectively reduced their carbon intensities by an average of 1.1,1.2,and 1.3 percent annually from 2010 through 2022.And in Sweden,carbon intensity declined by 1.9 percent on average during this period.Other affluent nations experienced less progress,particularly due to the closure of nuclear power facilities.For example,Germanys carbon intensity declined by only 0.2 percent on average per year from 2010 through 2022,while Japans increased by 0.9 percent annually on average.These figures highlight the scale of the challenge facing global policymakers and point to the importance of retaining low-carbon energy sources where they can continue operating safely.Figure 4.Ambitious Climate Scenarios Envision Unprecedented Improvement in Carbon IntensityNote:Historical data from Shell.Net CO2 emissions(i.e.,inclusive of negative emissions)per unit of primary energy demand are shown here.Global Energy Outlook 2024:Peaks or Plateaus?7World leaders at COP28 agreed to“tripling renewable energy capacity globally”to 11,000 gigawatts(GW)by 2030.11,18 Achieving this goal would require unprecedented growth across multiple technologies,particularly wind and solar.Three Ambitious Climate scenarios(IEA NZE,EnerGreen,and Shell Sky 2050)achieve the 2030 goal,but these scenarios are not based on existing or announced policies,highlighting the need for enhanced policy ambition if nations are to achieve their COP28 renewable energy goals.In 2010,renewable electricity was dominated by hydropower,which accounted for more than 75 percent of installed capacity worldwide.Over the next 10 years,renewable capacity more than doubled,growing by 125 percent,overwhelmingly led by wind and solar photovoltaic(PV),which accounted for more than 75 percent of capacity additions,followed by hydro at 18 percent.From 2020 to 2022,solar led a further acceleration of renewables growth,which increased at an annual rate of more than 10 percent,or 320 GW per year.To reach 11,000 GW of renewable capacity by 2030,annual capacity additions would need to average roughly 800 GW per year from 2022.For perspective,in 2022,global wind capacity was 832 GW and solar was 892 GW,highlighting the unprecedented rate of growth needed to achieve the renewable energy goal agreed upon at COP28.Figure 5.Renewable Electricity Capacity Triples by 2030 Under Three ScenariosNote:Historical data from EIA.“Renewables”includes hydro,biomass,wind,solar,geothermal,and tidal energy.Projections are taken directly from EIA and IEA.Projections for other organizations are estimated based on renewable electricity generation projections from each organization,converted to capacity assuming capacity factors imputed from the IEA APS.Resources for the Future8At COP28,22 nations committed to tripling their nuclear energy capacity by 2050.Achieving this goal would require a fundamental change in the trajectory of nuclear energy for developed nations,as 12 of the 22 experienced declining nuclear energy production from 2012 through 2022,while 5 currently produce no nuclear power.19 In recent years,nuclear energy growth has been led by China and India.Although neither of these countries was part of the announcement at COP28,they were the top two nations for nuclear power plant construction as of December 2023.20 Globally,nuclear capacity is projected to grow modestly under most scenarios,and 2022 levels triple by 2050 in just two scenarios,both from Enerdata.Projections for the growth of nuclear capacity span roughly 800 GW,nearly twice the installed capacity in 2022.Even across scenarios with similar CO2 emissions trajectories,projections vary widely.For example,Ambitious Climate scenarios show capacity growing by as little as 21 percent(Equinor Bridges)to tripling(EnerGreen)by 2050.Several Ambitious Climate scenarios,including those from IEA and Equinor,show rapid nuclear growth through 2040,followed by slower growth or declines in the following 10 years.Similarly wide ranges emerge in Evolving Policies and Reference scenarios.This uncertainty over nuclear reflects a variety of factors.Unlike wind,solar,and battery storage,which will be key to achieving Ambitious Climate targets and whose costs have fallen consistently over the last few decades,the costs and timelines for nuclear projects in the developed world have often missed their targetssometimes by wide margins.To even approach the goal of tripling nuclear capacity,more than half of the 22 nations that committed to doing so will need to reverse current trends and rapidly deploy new nuclear power.From 2022 to 2050,a global tripling would require CAAGR of 4 percent.From 1980 to 1990,the world added nuclear at a CAAGR of 9.4 percent,falling to a CAAGR of just 0.8 percent the following decade.From 2010 to 2022,nuclear energy capacity grew by just 0.3 percent annually.Figure 6.World Nuclear Power Capacity Triples by 2050 Under Just Two ScenariosNote:Historical data from Shell.Capacity data are taken from original in EIA,IEA,and Shell and estimated based on nuclear electricity generation from bp,Enerdata,Equinor,and ExxonMobil,assuming plants operated at the average global capacity factor in 202022.Global Energy Outlook 2024:Peaks or Plateaus?9Global electricity demand is projected to grow substantially under all scenarios.At the same time,the share of electricity generated by fossil fuels declines across scenarios,from 58 percent in 2022 to 42 percent or lower by 2050.Renewables,especially wind and solar,account for roughly half or more of global power generation by 2050,exceeding 80 percent of the mix under Ambitious Climate scenarios.This growth enables electricity to become a larger provider of energy services across the economy,particularly in the buildings and transportation sectors.In 2019,electricity accounted for roughly 20 percent of final energy consumption.By 2050,this share increases substantially under most scenarios.For example,bp and IEAs Evolving Policies scenarios see electricity growing to roughly 30 percent of final consumption by 2050 and exceeding 50 percent under each organizations Net Zero scenario.However,there is wide variation,suggesting that the decarbonization of the global power grid is not inevitable.Coal declines under all scenarios,but this decline ranges from 1 percent(EnerBase)to 96 percent(bp NZ)relative to 2022.Natural gas demand in the power sector grows or remains roughly flat across most Evolving Policies and Reference scenarios but falls by half or more under all Ambitious Climate scenarios.Wind and solar grow rapidly under all scenarios.In 2010,these two sources accounted for just 2 percent of global electricity generation.By 2050,they account for more than half of the power mix under 10 of the 14 scenarios examined here,including Evolving Policies scenarios such as IEA STEPS.Figure 7.World Electricity Demand Grows Rapidly,Led by Wind and SolarNote:2050 scenarios ordered from highest to lowest total levels of fossil fuel generation.Resources for the Future10Global natural gas demand has grown by two-thirds since 2000,driven primarily by the United States,Asia,and the Middle East.Unlike coal and oil,which peak under most scenarios examined here,natural gas demand increases under roughly half of the scenarios.This divergence highlights the complex role that natural gas plays in the global energy system and highlights its potential to both mitigate and exacerbate greenhouse gas emissions from the energy system.The future of global natural gas demand is highly uncertain and,like the future of most fuels and energy technologies,is highly dependent on public policies.Under Reference scenarios,global gas demand growth is robust,increasing by roughly 30 percent under ExxonMobil and EIA.In these scenarios,demand growth is led by the Asia-Pacific region,followed by the Middle East.However,demand declines in developed economies such as Europe and the United States under all scenarios other than EIAs Reference.Under Evolving Policies scenarios,considerable variation emerges across regions,in many cases highlighting the gaps between existing policies and the levels needed to achieve emissions reductions under NDCs.For example,gas demand in Asia-Pacific and Latin America grows by 24 and 14 percent respectively under IEA STEPS but falls by 40 and 36 percent under IEAs APS.Similar gaps emerge for all other regional groupings shown in Figure 8.Under most Ambitious Climate scenarios,gas demand declines across all regions by 2050 except Africa,where lack of access to affordable modern energy sources affects hundreds of millions of people.Under Net Zero scenarios from bp and Shell,natural gas demand falls by roughly 70 percent in North America and Europe-Eurasia and by at least one-third in Asia-Pacific,Latin America,and the Middle East.Figure 8.Projections for World Natural Gas Demand Vary Widely Across ScenariosNote:Historical data from bp(2000)and IEA(2010,2022).All scenarios except ExxonMobil exclude flared natural gas.Global Energy Outlook 2024:Peaks or Plateaus?11From 2000 through 2010,Chinas economy expanded extraordinarily,powered primarily by coal.Ten years ago,central projections from the EIA and IEA envisioned that expansion continuing,plateauing in the 2020s(for the IEA)or 2030s(for EIA).The projections in the 2023 outlooks,however,show considerable decline in projected Chinese coal demand due to a declining population,stagnating economy,and increasing availability of cleaner and cheaper alternatives.In the first two decades of the 21st century,Chinas demand for coal more than tripled,making it the worlds largest energy consumer and emitter of CO2.In recent years,however,China has reduced its reliance on coal in the residential sector and implemented new policies to constrain emissions growth and boost alternatives such as hydro,nuclear,wind,and solar.Looking forward,all scenarios examined in this years Global Energy Outlook project that coal will decline substantially in China.This decline is driven in part by policy,including Chinas cap-and-trade program and robust government support of hydro,nuclear,wind,and solar.But it is also due to a slowing economy and a population that is projected to begin declining,falling from 1.4 billion today to 1.3 billion by 2030 under the UNs median variant projection.21 The International Monetary Fund(IMF)projected that Chinas economy will continue growing in 2024,but considerably more slowly than in most recent years,in large part due deep weakness in its real estate sector.22The EIAs 2023 projection for Chinese coal demand is 35 percent lower in 2040 than 10 years prior.By 2050,the IEA projects that demand will fall by more than half relative to 2022,reaching 43 QBtu,a level last seen in the early 2000s.Although these projected declines will help reduce CO2 emissions,they are well above the levels needed to achieve international climate targets.We explore these topics in more depth in Section 3.1.Figure 9.Chinas Projected Coal Demand Has Declined Dramatically Over the Last 10 YearsNote:IEA 2013 shows the New Policies scenario,which used assumptions similar to those in IEAs more recent STEPS series.EIA shows the Reference scenario for both 2013 and 2023.Historical data from the 2023 Statistical Review of World Energy.19Resources for the Future12The physical inputs that power buildings,transportation,and industry are shifting.For most of human history,primary energy has been provided by a mix of solid,liquid,and gaseous fuels.But in a future where energy technologies such as wind,solar,and battery storage play a larger role in providing energy services,critical minerals will become central to powering the global economy.Demand for some of these minerals,which today are used in modest quantities,is projected to grow by orders of magnitude in the decades ahead,raising new questions about supply costs,geopolitics,and environmental impacts.Throughout the fossil fuel era,fears of resource scarcityparticularly for oilhave worried analysts and policymakers alike.Although fossil fuels have exhibited considerable price volatility,concerns over physical scarcity have repeatedly been mollified by technological innovation,enhanced efficiency,and the discovery of new supplies.It is unclear whether,and to what extent,critical minerals will follow a similar path(although some major market players have voiced concerns about supply shortfalls by 2030).23 As we discuss in detail in Section 3.3,most of the outlooks analyzed here acknowledge the importance of critical minerals and uncertainties over their future,but few provide detailed demand projections,and none provide an in-depth analysis of supply and cost.These omissions highlight the relatively recent emergence of critical minerals as a top priority for policymakers and the energy industry and demonstrate the need for new data collection,analysis,and modeling of this topic to better inform decisionmakers in the decades ahead.This includes not only information about supply and demand but also careful considerations of the environmental,social,and geopolitical consequences of increased reliance on certain minerals.Figure 10.Demand for Some Critical Minerals Grows by Orders of Magnitude(2022=1,log scale)Note:Projections from IEA.Global Energy Outlook 2024:Peaks or Plateaus?133.In Focus3.1.Chinas Evolving Energy Future against a Foreboding Economic OutlookChina has seen immense economic growth over the past few decades.Since 2010,the country has accounted for roughly 33 percent of the global growth in GDP and almost 60 percent of the growth in primary energy demand.8 However,because this growth has been powered primarily by coal,China accounted for over 80 percent of the global increase in CO2 emissions since 2010.8In recent years,Chinas leaders have sought to manage the unabated development of energy-intensive and high-emissions projects,mainly because of concerns over air quality and climate change.In 2020,Chinas NDC committed to“aim to have CO2 emissions peak before 2030 and achieve carbon neutrality before 2060.”24 Following this pledge,China issued a national implementation plan for all ministries and provincial governments that outlines 43 tasks for sectors including energy and industry.25 In the energy sector,China has committed to boosting energy efficiency,renewables,and nuclear while pursuing a reduction in fossil fuel consumption.For industry,the Ministry of Industry and Information Technology has outlined a roadmap to control emissions in steel,petrochemicals,metals,and concretethe most emissions-intensive industriesin the 14th Five-Year Plan(FYP).25,26 Additionally,the plan outlined the use of cleaner energy sources in these industries,such as hydrogen and biofuels.FYPs provide strong indications of future directions,as historically,China has exceeded its climate objectives under the plans.27 Recent analysis suggests that the 14th FYP will put China on track to meet its goal of peaking emissions by 2030,although additional policies will be needed to meet carbon neutrality targets for 2060.28Macroeconomic factors,particularly an aging population and an unfolding property crisis,will have major implications for the future of energy and emissions in China.Although total population began declining in 2022,the working-age population(ages 1559)peaked in 2011,slowing GDP growth relative to recent history.21 The working-age population is expected to decline 30 percent from its peak by 2050(Figure 11).Resources for the Future14Compounding these demographic trends is a financial crisis that is deeply affecting property developers.For the past few decades,the real estate market grew rapidly,viewed as a safe investment and the“main store of wealth for many Chinese families.”29 In 2020,the government,concerned about a potential housing bubble,instituted rules to curb excessive borrowing by developers.With reduced access to capital,China Evergrande,the second-largest property developer in the country,defaulted on payments in 2021;this cascaded into reduced confidence in the sector and a prolonged decline in new home sales.Since Evergrandes default,over 50 property firms have defaulted on debt,29 further reducing investor confidence and deterring new investment.Although the effects on demand for energy and building materials have been limited to date,the crisis may result in lower demand in the long term.8 At the same time,this crisis is indicative of a broader economic transition in the country as policymakers reportedly work to steer the economy away from real estate,which accounts for a quarter of Chinas economy,29 and toward manufacturing sectors such as electric vehicles and semiconductors.30 The growth of these high-tech sectors,as well as continued rapid electrification,may continue to drive demand for energyparticularly electricityeven in the face of the property crisis.Figure 12 compares the IEAs and EIAs 2023 projections for the consumption of coal,oil,natural gas,and renewable energy with those from 2019 and 2013.Although China remains by far the worlds largest consumer of coal,2023 outlooks project a coal peak followed by a decline,whereas 2013 and 2019 projections envisioned peaks(in some cases,much higher peaks)followed by extended plateaus.This is driven primarily by a shift away from coal in the power sector and improved efficiencies in industrial processes such as iron-and steelmaking.Figure 11.Projected Gross Domestic Product and Working-Age Population in ChinaSource:Population projections from UN World Population Prospects 2022(median variant).21Note:GDP data in purchasing power parities(PPP)terms.Global Energy Outlook 2024:Peaks or Plateaus?15In the power sector,IEA projects that while total coal-fired capacity will grow to 2030,capacity factors will decline substantially.8 IEA assumes that coal will gradually transition to providing grid flexibility,rather than delivering base load power,as new sources such as wind and solar come online.In the industrial sector,both outlooks project that iron and steel production will gradually reduce coal use as scrap metal becomes more available for secondary production,which is typically less energy intensive and can use electric arc furnaces(rather than coal-fired blast furnaces)for process heating.Chinas oil and gas demand has grown steadily over the past few decades.However,key policy initiatives have contributed to downward revisions of projections in the 2023 IEA scenario.The 14th FYP lays out key goals that will reduce natural gas demand in the buildings sector,such as retrofitting 350 million square meters of existing buildings through improvements such as building envelope insulation and electrification,along with greater energy efficiency in new construction.Additionally,an increased share of renewable generation on the grid,as well as a target to add 50 GW of renewable energy capacity through building-integrated and building-added PV,will dampen demand for natural gas.8,31 In the transportation sector,the New Energy Vehicle Industrial Development Plan targets a 20 percent share of new vehicle shares comprised of for“new energy vehicles”(battery electric vehicles,plug-in hybrid electric vehicles,and fuel cell vehicles)by 2025,which will reduce demand for petroleum products.32Figure 12.Primary Energy Consumption in ChinaNote:EIA projections do not include nonmarketed biomass and are excluded from the“Renewables”figure.Resources for the Future16The upward revision for renewables demand in IEAs 2023 scenario has been driven by solar PV and wind.While the 14th FYP outlines a goal of 1,200 GW of installed solar and wind capacity by 2030,China more than doubles that goal by 2030 in the IEA STEPS scenario.8 In fact,some project that China may reach its stated goal by 2025,driven by subsidies and an array of other policies.33Figure 13 shows the overall shift in projected 2030 primary energy demand from IEA and EIA scenarios from 2013 and 2023.Renewables have increased substantially,and fossil fuel demand(particularly coal)has declined,resulting in a peak in CO2 emissions by 2030.However,the majority of primary energy demand in the country is still served by fossil fuels.In both the EIAs and IEAs 2023 scenarios,roughly 80 percent of primary energy demand is served by fossil fuels in 2030,highlighting the gap between the policies implemented by the 14th FYP to peak CO2 emissions by 2030 and the longer-term goal of net zero by 2060.Figure 14 further illustrates the differences in projected energy demand between Chinas current policies,its announced NDC,and net-zero scenarios.Across all scenarios,coal demand is expected to decline by 2050,falling by 25 percent(EIA Reference)to 93 percent(Equinor Bridges and bp Net Zero)relative to 2022.Oil demand is also expected to decline in most scenarios,except EnerBase,EIA Reference,and OPEC.Projected natural gas demand varies more widely,growing in most Reference and Evolving Policies scenarios,but declining with Ambitious Climate scenarios.Renewables,led by wind and solar,grow substantially under all scenarios but most rapidly under the Ambitious Climate scenarios,where they exceed fossil fuels by 2050.Figure 13.Chinas Primary Energy Demand Projections from 2013 to 2023 Note:IEA scenarios in this figure are the 2013 New Policy Scenario(NPS)and the 2023 STEPS.Global Energy Outlook 2024:Peaks or Plateaus?173.2.Emerging Technologies for Achieving Net ZeroIn recent years,public and private sector actors have increasingly pledged to reach net-zero carbon emissions by midcentury.But there is considerable uncertainty and debate over the role of fossil fuels in the net-zero energy transition.For example,a heated debate took place at COP28 over whether nations should plan to phase out or simply phase down fossil fuels,as well as whether to include the pivotal qualifier“unabated,”which would leave room for continued use of fossil fuels paired with CCUS.34In this section,we examine three technologies that could,perhaps controversially,play a role in continuing the use of fossil fuels in the energy system:hydrogen,CCUS,and direct air capture(DAC).3.2.1.HydrogenDepending on how it is produced,rapid growth in global hydrogen demand could extend the life of fossil fuels considerably.The oil and gas industry is experienced in producing hydrogen through steam methane reformingthe primary means of global productionand handling it in pipelines and industrial processes.Today little hydrogen is consumed directly to provide energy services;rather,it is generally used as a feedstock in the production of ammonia,which is used to make fertilizer,and,to a lesser extent,as part of the process of refining crude oil.But new low-or zero-carbon hydrogen is increasingly seen as an option to decarbonize otherwise hard-to-abate industries that have historically relied on fossil fuels for energy(e.g.,long-distance shipping and aviation)and high-temperature heat(e.g.,cement manufacturing and steelmaking).Figure 14.Primary Energy Demand in ChinaResources for the Future18In the United States,the Inflation Reduction Act includes a tax credit of up to$3 per kilogram for“clean”hydrogen.Largely as a result of the generosity of the credit,the definition of clean hydrogen has been subject to much debate and lobbying.35 There is also some overlap with CCUS,as“blue”hydrogen,produced using natural gas with CCUS,can earn a CCUS tax credit of$85 per ton of CO2(although the law forbids blue hydrogen to“double dip”that is,to claim both the CCUS and hydrogen tax credits).While controversy and debate swirls around these tax credits,they appear to be spurring substantial investment:more than$1 billion of hydrogen investment in the United States in 2023.36In 2022,world hydrogen use for non-energy-related purposes amounted to about 95 million tons per annum(mtpa),or 11 QBtu worth of energy equivalent.8,37 Under some scenarios,by 2050,hydrogen used in the energy sector could rival todays global 95 mtpa total(Figure 15).However,this would still account for a fairly small share of global final energy consumption.For example,IEAs APS reaches 91 mtpa(10 QBtu of energy equivalent)of hydrogen energy demand by 2050,representing just 2.5 percent of global final energy consumption.The most rapid growth occurs in Shells Sky 2050 scenario,where hydrogen provides 7 percent of global final energy consumption by 2050.In developed nations such as the United States,growth may be more rapid.By 2050,hydrogen accounts for more than 10 percent of US final energy demand under the APS(US-specific data for Shell Sky 2050 and IEA NZE are not available).Figure 15.Global Hydrogen Consumption for EnergyNote:Equinor projections include only hydrogen used in transportation,so those projections represent lower bounds.Global Energy Outlook 2024:Peaks or Plateaus?193.2.2.Carbon Capture,Use,and Storage(CCUS)and Direct Air Capture(DAC)As discussed in Section 2,CCUS is projected to grow considerably in many scenarios(see Figure 2),with some Ambitious Climate scenarios showing growth of two orders of magnitude,rising from 42 MMT CO2 in 2022 to 4,0007,000 MMT CO2 by 2050(for context,global energy-related CO2 emissions in 2022 were roughly 37,000 MMT).DAC is a particular form of CCUS.Instead of capturing CO2 from a concentrated stream of waste gases,as most CCUS applications do,DAC would capture CO2 from ambient air,sequestering it underground or in some product or application.Because of this,DAC facilities would provide a form of carbon removal(assuming their large energy needs are met by nonemitting energy sources)and help offset emissions from elsewhere in the economy.As of 2023,27 DAC facilities were in operation,with more than 100 additional facilities in the development process.38In the United States,DAC developers are eligible to receive a tax credit of$180 per metric ton of CO2 captured and permanently stored and$130 per metric ton of CO2 used in enhanced oil recovery(EOR).This second application of DAC is particularly controversial because the oil extracted using the captured CO2 would create emissions that could reduce or eliminate the climate benefits of permanent CO2 sequestration.On the other hand,it is at least technically possible for the volumes of CO2 stored using EOR to meet or exceed the emissions embodied in the oil produced;in other words,EOR could theoretically be used to produce“carbon neutral”or even“carbon negative”oil.39Figure 16 shows projections for global DAC growing from effectively zero today to as high as 600700 MMT CO2 annually by 205055 in Ambitious Climate scenarios,representing about 1.5 to 2 percent of todays global emissions.This remains only about one-tenth of the projected deployment of CCUS in the same scenarios by the same modeling teams(6,0007,000 MMT CO2;see Figure 2).While this suggests a more modest role for DAC than for other forms of CCUS,at least one scenario is more bullish in the decades ahead:Shells Sky 2050 scenario does not include large-scale DAC until 2045,but it eventually reaches over 5,000 MMT CO2 annually in 2100,which is about half of total CCUS projected for that year.Resources for the Future203.2.3.Back to the Future(of the Past)Finally,we compare projections for all three technologiesCCUS,DAC,and hydrogenin this years outlooks with those from 2022.Where comparable data are available(Equinor and IEA),projections suggest that a combination of policy incentives and technological advances are generally driving projections for these technologies higher.Both organizations generally increased their CCUS projections.Under IEA APS,CCUS deployment in 2050 was 15 percent higher in 2050 relative to 2022s projection(STEPS and NZE were roughly unchanged),and Equinor raised its 2050 projection by 4 and 33 percent under Bridges and Walls,respectively.Projections for DAC in 2050 increased by roughly 30 and 60 percent under IEAs STEPS and NZE scenarios,respectively,while remaining roughly unchanged under IEA APS and both Equinor scenarios.For hydrogen,IEA increased its 2050 projections by 3 percent under STEPS and 15 percent under APS(however,it was not included in the 2022 IEA NZE scenario,which prevents a comparison with this years projection),whereas Equinor saw a 3 percent decrease in Bridges and 26 percent growth in Walls.Taken together,these projections suggest increasing confidence that CCUS,DAC,and hydrogen will play a meaningful role in managing greenhouse gas emissions in the future.However,much uncertainty remains over the durability of policy,technological innovation,and private sector appetite for these emerging technologies.In addition,public opposition to the deployment of these technologies,particularly if they are seen as providing license to continue the extraction and use of fossil fuels,could create additional headwinds.Figure 16.Global Direct Air CaptureGlobal Energy Outlook 2024:Peaks or Plateaus?213.3.A New Era of MiningBuilding a clean energy future requires new material inputs into an economy that has been powered primarily by solid,liquid,and gaseous fuels for more than a century.Although not all outlooks project future demand for minerals,a growing number of organizations are recognizing the importance of,and uncertainty surrounding,these materials.Three of the 2023 outlooks(bp,IEA,and Shell)provide projections on future demand for cobalt,copper,lithium,and nickel,which are used for a variety of applications in clean energy and other sectors.All the projections included in these outlooks focus exclusively on demand for,rather than supply of,these minerals,and the methodologies for producing them are generally opaque.40 In future years,a more robust accounting of underlying assumptions regarding future demand and supply would enable deeper analysis.For example,the construction of demand curves across technologies and over time requires organizations to make crucial assumptions about future efficiency improvements,technological innovation,potential substitutes,and more.In addition,the outlooks do not provide detailed projections of,and in some cases do not model,how future supply will arise and at what cost.(For example,the IEA states in its 2023 outlook,“We do not yet model full long-term supply-demand balances for critical minerals.”)8 Indeed,recent years have seen substantial volatility in prices for several critical minerals,and much uncertainty remains about future demand and supply balance.Throughout the fossil fuel era,fears of resource scarcityparticularly for oilhave worried analysts and policymakers alike.Although fossil fuels have exhibited considerable price volatility,concerns over physical scarcity have repeatedly been alleviated by technological innovation,enhanced efficiency,and the discovery of new supplies.It is unclear whether,and to what extent,critical minerals will follow a similar path(although some major market players have voiced concerns about supply shortfalls by 2030).23 Nonetheless,we have no reason to doubt that innovation,efficiency improvements,and the discovery of new resources will expand the resource base in the years ahead.And unlike fossil fuels,clean energy minerals have the potential to be recycled,which could further ease concerns over resource scarcity.The IEA seeks to address some of the uncertainties around supply and demand through additional scenario analysis.For example,it models several cases including with constrained nickel supply,a more rapid deployment of solid-state batteries,and smaller battery sizes,and other scenarios.This type of scenario analysis can help lay the groundwork for more detailed future work,including a more robust picture of supply chains and cost curves.Regardless of issues related to resource constraints,a growing trade of clean energy materials will raise important new questions.For example,how will local environments and human health be affected by increased mining activities?How might such activities affect local communities and economies?And how will new trade flows and concentration of supplies affect geopolitics?Scholars and policy practitioners have begun to probe these questions,4144 but much future work will be needed to assess the scale of impacts and design new policies to address challenges as they arise.Resources for the Future22In Sections 3.3.13.3.5,we examine the history of and projections for four materials that are likely to be foundational to a clean energy transitioncobalt,copper,lithium,and nickelas well as several lesser-known minerals for which demand is projected to grow by orders of magnitude in the years ahead.3.3.1.CobaltCobalts most prominent use globally is in batteries for electric vehicles.In 2022,roughly 68 percent of the cobalt supply was produced in the Democratic Republic of Congo,45 and concerns over human health,child labor,and environmental impacts related to this production have been widely publicized.4648 Nearly 75 percent of cobalt processing occurs in China,49 raising further concerns about supply chain diversification as demand for the material grows in the years ahead.Figure 17 shows the projections for global cobalt demand.Among the six scenarios that project future cobalt demand,the most conservative(IEA STEPS)shows global demand more than doubling by 2050.Under the IEAs APS and STEPS scenarios,global demand roughly triples.Under both of Shells scenarios,demand growth outpaces all of IEAs projections,more than tripling by 2050 under Archipelagos and growing by more than nine-fold under Sky 2050.The wide range in projected demand raises significant questions about the assumptions for the deployment of electric vehicles and for other technologies that use cobalt.These include the availability of materials that can substitute for cobalt in future technologies,the potential for efficiency improvements,and the viability of recycling.Indeed,the United States,the European Union,and others have begun to develop strategies to enhance each of these efforts,in an effort to reduce exposure to concentrated markets and potentially unstable supply chains.50,51Figure 17.World Cobalt Demand ProjectionsNote:Historical data from Shell.Global Energy Outlook 2024:Peaks or Plateaus?233.3.2.CopperCopper is a fundamental enabler of all aspects of the electricity sector.Its production and refining are more diversified than most other minerals discussed in this section,with major producers including Chile,Peru,Congo,China,the United States,and Russia,52 although more than 40 percent of all processing occurs in China.49Figure 18 shows the projections for global copper demand.From 1980 to 2022,demand grew at an average rate of 8 percent per year.Under projections from IEA,the average annual growth rate from 2022 to 2050 slows to between 5 and 6 percent across scenarios.Shell and bp,however,project considerably more rapid demand growth,increasing by a minimum of 8 percent per year(Shell Archipelagos)and as rapidly as 14 percent per year through 2040(bp Net Zero).Figure 18.World Copper Demand ProjectionsNote:Historical data from Shell.bp projections available only for 2040.Resources for the Future243.3.3.LithiumLike cobalt,global lithium demand rises from a very small base in the years ahead,particularly under Ambitious Climate scenarios,to support the deployment of batteries in electric vehicles and other applications.Current production is centered in Australia and Chile,although continued exploration has led to recent announcements of major new deposits,including in the United States.53 Figure 19 shows the projections for global lithium demand.From 2000 to 2022,demand grew on average by 31 percent annually.Looking to 2050,the annual growth rate slows to 19 percent under IEA STEPS but rises by 27 to 40 percent per year across other scenarios from IEA and bp.The fastest growth rate(91 percent annually)comes from Shells Sky,where demand grows to nearly 3 billion metric tons per year by 2050.Like other minerals discussed in this section,material substitution could substantially slow future demand for lithium.Although a wide variety of alternative battery chemistries have been under development for years,it is unclear whether,to what extent,and over what time frame they will grow to compete with the still-evolving lithium-ion chemistries.54Figure 19.World Lithium Demand Projections Note:Historical data from Shell.bp projections available only for 2040.Global Energy Outlook 2024:Peaks or Plateaus?253.3.4.NickelAs with copper,the global market for nickel is well developed,with roughly 3.3 billion metric tons produced in 2022.Indonesia is by far the worlds largest supplier,contributing almost half the total in 2022,with other major producers including the Philippines,Russia,New Caledonia,and Australia.55 Indonesia is also the worlds largest nickel processor,at 43 percent of the global total,followed by China at 17 percent.49Figure 20 shows the projections for global nickel demand.From 2000 to 2022,demand grew by 9 percent per year on average.Similar to projections for world copper demand,the bp and Shell projections are for robust growth rates,ranging from 10 to 20 percent annual growth to 2040(for bp)and to 2050(for Shell).Projections from the IEA are more muted,with growth rates through 2050 of 6 percent in STEPS and 8 percent in APS and NZE.Although data limitations prevent us from carrying out a thorough analysis,it appears that the IEA projections assume greater improvements in efficiency,materials substitution,and recycling than those from bp or Shell.Figure 20.World Nickel Demand ProjectionsNote:Historical data from Shell.bp projections available only for 2040.Resources for the Future263.3.5.Other MineralsAlthough the four minerals discussed in the previous subsections are some of the most significant in terms of scale,their rate of clean energyrelated demand growth is dwarfed by that of other clean energy minerals(Figure 21).While demand for lithium grows by roughly one order of magnitude under most of the bp,IEA,and Shell scenarios,demand for galliumwhich is used in semiconductors and other electronicsrises by nearly three orders of magnitude by 2040 under IEAs scenarios.Demand for vanadium,which today is used in specialized steelmaking and other industrial applications,grows fastest in all these scenarios,rising by nearly five orders of magnitude by 2040.Unlike copper and nickel,which have been mined at scale for generations,many clean energy minerals are starting from a very small base,which helps explain their extraordinary rates of growth.For example,the USGS reports that global production of gallium in 2022 was roughly 550 metric tons,56 less than 2 percent of which were used in clean energy.49 Similarly,global vanadium production in 2022 was 100,000 metric tons,57 roughly 0.1 percent of which was used in clean energy.49 By 2050,clean energydriven demand for gallium reaches 3,300 metric tons under the IEAs STEPS,six times todays global production across all sectors.For vanadium,clean energy demand rises to 233,000 metric tons,more than doubling todays global production.Increasing the supply of a given commodity two-,four-,or even six-fold over the course of 25 years would hardly be unprecedented,especially when beginning from a small base.Nonetheless,the clean energy transition clearly presents new challenges for identifying,sustainably producing,and reliably distributing large new flows of materials across the global economy.Figure 21.Projected Energy Sector Demand Growth for Select Minerals,2022=1(log scale)Note:Solid lines indicate IEA STEPS,dot-dash indicates APS,and dotted indicates NZE.Global Energy Outlook 2024:Peaks or Plateaus?274.Data and MethodsIn this paper,we examined projections energy outlooks from a wide range of sources representing a diverse set of views on the future of energy(see Table 1).These outlooks vary across a variety of dimensions,including differences in modeling techniques,historical data,economic growth assumptions,and policy scenarios.Generally,scenarios can be grouped into three categories:(1)Reference,which assumes no major policy changes;(2)Evolving Policies,which incorporates the modeling teams expectations of policy trends;and(3)scenarios that do not fall into one of the other two categories and are typically based on policy targets or technology assumptions.We focus on Ambitious Climate scenarios,a major subset of category 3.Table 4 summarizes the sources and scenarios included in our analysis.Resources for the Future28Table 4.Sources and ScenariosSourceScenariosGrubler(2008)1Historical data.IEA(2022)2Historical data.bp(2023)3New Momentum:Reflects current policies and places weight on achieving recently announced ambitions for emissions reductions.Accelerated:Emissions fall 75low 2019 levels by 2050,consistent with IPCC scenarios limiting warming to 2C by 2100.Net Zero:Emissions fall 95low 2019 levels by 2050,consistent with IPCC scenarios limiting warming to 1.5C by 2100.EIA(2023)4Reference:Reflects current policies,select economic and technological developments,and“current energy trends and relationships.”Enerdata(2023)5EnerBase:Fossil fuels remain dominant as countries limit or delay actions to reduce emissions.Consistent with global temperature rise of more than 3C by 2100.EnerBlue:Fossil fuel use declines moderately as countries enact their NDCs.Consistent with global temperature rise of 2.0C to 2.5C by 2100.EnerGreen:Countries enact ambitious climate policies consistent with 2015 Paris Agreement goals.Consistent with global temperature rise below 2C by 2100.Equinor(2023)6Walls:Begins with current policies and assumes that future climate and energy policies slowly become more ambitious.Bridges:Designed around limiting warming to 1.5C by 2100.ExxonMobil(2023)7Reference:Begins with current market,technology,and policy trends.Unclear to what extent additional energy and climate policies are included.IEA(2023)8Stated Policies Scenario(STEPS):Focuses on what governments“are actually doing,”including existing policies and those under development.Roughly consistent with 2.5C warming by 2100.Announced Pledges Scenario(APS):Includes announced climate commitments by governments and nongovernmental entities,including net-zero pledges,regardless of implementation status.Roughly consistent with 1.7C1.8C warming by 2100.Net Zero Emissions by 2050(NZE):Follows an updated roadmap to net-zero emissions by 2050,consistent with 1.5C warming by 2100.Also achieves UN Sustainable Development Goals,such as universal energy access by 2030.OPEC(2023)9Reference:Incorporates policies that have been enacted.Assumes some future policy changes,but details are not specified.Shell(2023)10Archipelagos:Policymakers focus on energy security,become more nationalistic,and reduce international cooperation on numerous issues,including climate.Sky 2050:Designed to reach net-zero emissions by 2050 and limit warming by 1.5C by 2100.Global Energy Outlook 2024:Peaks or Plateaus?294.1.HarmonizationVariations in underlying assumptions about the future of policies,technologies,and markets produce useful variation among outlooks,allowing analysts to view a wide range of potential energy futures.However,outlooks also have important methodological differences,which can complicate direct comparisons and reduce the ability to draw insights.One major difference is the choice of reporting units.For primary energy,outlooks use different energy units,such as QBtu,million tonnes of oil equivalent(mtoe),or exajoules(EJ).In this report,we standardize all units to QBtu.For fuel-specific data,outlooks also vary,using million barrels per day(mbd)or million barrels of oil equivalent per day(mboed)for liquid fuels,billion cubic meters(bcm)or trillion cubic feet(tcf)for natural gas,million tonnes of coal-equivalent(mtce)or million short tons(mst)for coal,and Terawatt hours(TWh)or Gigawatt hours(GWh)for electricity generation.Table 5 presents the reporting units for each outlook,and Table 6 provides relevant conversion factors.Table 5.Units of Energy Consumption,by OutlookbpEIAEnerdataEquinorExxon MobilIEAOPECShellPrimary energy unitsEJ QBtumtoemtoeQBtu EJmboedEJFuel-or sector-specific unitsLiquidsmbdmbdN/AN/AQBtu mbdmbdEJOilmbdmbdmtoembdQBtumbdmbdEJBiofuelsmbdmbdN.A.mtoeQBtumboedmbdEJNatural gasbcmtcfmtoebcmQBtubcmmboedEJCoalEJmstmtoemtoeQBtumtcemboedEJElectricityTWhTWhGWhTWhQBtuTWhN/AN/ANote:Units are per year unless the unit abbreviation indicates otherwise.N/A indicates that fuel-specific data are not available for a given source.Resources for the Future30A second key difference among outlooks is that assumptions about the energy content in a given physical unit of fuel result in different conversion factors between data presented in energy units(e.g.,QBtu)and those presented in physical units(e.g.,mbd or bcm).Among the outlooks we examine,these assumptions vary by up to 10 percent.Although conversion unit variations may appear small,they are amplified when applied across the massive scale of global energy systems,particularly over long time horizons.A third major difference results from varying decisions about including nonmarketed biomass,such as locally gathered wood and dung,in historical data and projections for primary energy consumption.In previous years,bp and the EIA had not included these sources in their projections.However,bps Energy Outlook 2023 does include nonmarketed biomass,allowing for enhanced comparability.(The EIA publishes its International Energy Outlook every two years and did not publish one in 2023.)Yet another difference relates to comparing the energy content of fossil and nonfossil fuels.The primary energy content of oil,natural gas,and coal is relatively well understood and similar across outlooks.However,a substantial portion of that embodied energy is wasted as heat during combustion.Because nonfossil fuels,such as hydroelectricity,wind,and solar,do not generate substantial amounts of waste heat,identifying a comparable metric for primary energy is difficult,and outlooks take a variety of approaches.Other differences in outlooks include(1)different categorizations for liquid fuels and renewable energy,(2)different regional groupings for aggregated data and projections,(3)using net versus gross calorific values when reporting energy content of fossil fuels,(4)using net versus gross generation when reporting electricity data,and(5)whether and how flared natural gas is included in energy consumption data.To address those challenges and allow for a more accurate comparison across outlooks,Newell and Iler apply a harmonization process.58 We update and use it here.For details,see Raimi and Newell.59Table 6.Conversion Factors for Key Energy UnitsPrimary energyMultiply byNatural gasMultiply byCoalMultiply bymtoe to QBtu0.0397bcm to tcf0.0353mtce to short ton1.102mboed to QBtu1.976mtce to mtoe0.7EJ to QBtu0.948Note:There is no agreed-upon factor for boe.IEA reports that typical factors range from 7.15 to 7.40 boe/toe,and OPEC uses a conversion factor of 7.33 boe/toe.We derive 1.976 QBtu/mboed by multiplying 49.8 mtoe/mboed(=1 toe/7.33 boe*365 days per year)by 0.03968 QBtu/mtoe.5.StatisticsTable 7.Global Key IndicatorsPopulationEnergyGDPNet CO2GDP/capitaEnergy/GDPEnergy/capitaNet CO2/energy$in PPP termsMillionsQBtu$T,2022BMT$1,000/person1,000 Btu/$1,000 Btu/personMMT/QBtu 2010 6,967 512 114 31 16.4 4.5 73.4 59.9 2022 7,950 597 164 34 20.6 3.6 75.1 57.0 2050 bp New Momentum 9,735 595 323 25 33.2 1.8 61.2 42.3 bp Accelerated 9,735 465 323 7 33.2 1.4 47.7 15.8 bp Net Zero 9,735 417 323 1 33.2 1.3 42.8 2.8 EIA 9,603 678 334 41 34.8 2.0 70.6 60.4 EnerBase 9,596 834 412 37 43.0 2.0 86.9 44.9 EnerBlue 9,596 644 412 15 43.0 1.6 67.1 23.2 EnerGreen 9,596 520 412 6 43.0 1.3 54.1 11.6 IEA STEPS 9,681 685 339 27 35.0 2.0 70.8 39.1 IEA APS 9,681 589 339 11 35.0 1.7 60.9 18.6 IEA NZE 9,681 512 339 1 35.0 1.5 52.9 1.3 OPEC(2045)9,468 710 318 34 33.6 2.2 75.0 48.2 Shell Archipelagos 9,709 696 347 28 35.7 2.0 71.7 40.1 Shell Sky 2050 9,709 608 347 5 35.7 1.8 62.7 7.8$in MER terms 2022 7,950 597 108 34 13.5 5.5 75.1 57.0 2050 EIA 9,603 678 198 41 20.6 3.4 70.6 60.4 Equinor Bridges 9,700 403 192 (1)19.7 2.1 41.5 (2.4)Equinor Walls 9,700 588 192 21 19.7 3.1 60.6 36.0 ExxonMobil 9,700 660 218 26 22.5 3.0 68.0 38.8 Note:Historical data from IEA.Net CO2 emissions include positive(gross)and negative emissions from sources such as direct air capture and bioenergy with CCS.CO2 emissions data include fossil fuel combustion and exclude industrial process emissions.Note that EIA excludes non-marketed biomass from its projections while others include it.Global Energy Outlook 2024:Peaks or Plateaus?31Table 8.World Primary Energy ConsumptionQBtuTotalCoalLiquidsNatural gasNuclearHydropowerOther renewables1990350881316621737201051214516610929125120225971611811372815752050 bp New Momentum595911391583519154 bp Accelerated4652283834824203 bp Net Zero4171647575826214 EIA Reference678158220179351967 EnerBase8341322022376221180 EnerBlue64439131988920267 EnerGreen5202166318819295 Equinor Bridges4031148393917248 Equinor Walls588671531404120166 ExxonMobil660912011744319130 IEA STEPS685961851374522201 IEA APS58943110805625276 IEA NZE5121450306428327 OPEC(2045)7101072161724721147 Shell Archipelagos6961101831182526234 Shell Sky 205060842100634418343Note:“Liquids”includes only oil for Enerdata,as biofuels-specific data were not available.32Resources for the Future33Global Energy Outlook 2024:Peaks or Plateaus?Table 9.Liquids Consumption,by RegionQBtuWorldAverage annual growthWestAverage annual growthEastAverage annual growthMB/dMB/dCAAGRMB/dMB/dCAAGRMB/dMB/dCAAGR199072ndnd2010911.01.2D352022990.70.7D0.0-0.1E0.82.0 502022-20502022-20502022-2050 bp New Momentum76-0.8-0.90-0.5-1.4F0.00.1%bp Accelerated46-1.9-2.7-1.0-3.3(-0.6-1.6%bp Net Zero26-2.6-4.7-1.2-5.3-1.0-3.6%EIA Reference1210.80.7R0.30.6i0.91.6%EnerBase1110.40.4%EnerBlue72-1.0-1.1%EnerGreen36-2.2-3.5%Equinor Bridges26-2.6-4.6%Equinor Walls84-0.5-0.6%ExxonMobil1100.40.4-0.2-0.4p0.91.6%IEA STEPS1010.10.12-0.4-1.1S0.30.6%IEA APS60-1.4-1.8-1.0-3.83-0.4-1.1%IEA NZE27-2.6-4.5%OPEC(2045)1180.70.6F0.10.1i0.91.5%Shell Archipelagos1000.00.07-0.2-0.6X0.50.9%Shell Sky 205055-1.6-2.1!-0.8-2.71-0.5-1.2%Note:“Liquids”includes only oil for Enerdata,as biofuels data were not available.Regional totals may not sum because of different treatment of international aviation and bunker fuels and,for IEA,exclusion of biofuels in regional data.Where volumetric data are not published,we assume a conversion factor of 1.832 QBtu/mbd,or 0.54585 mbd/QBtu.Table 10.Natural Gas Consumption,by RegionQBtuWorldAverage annual growthWestAverage annual growthEastAverage annual growthTCFTCFCAAGRTCFTCFCAAGRTCFTCFCAAGR199061ndnd20101012.02.5h3320221262.11.9v0.60.9P1.53.7 502022-20502022-20502022-2050 bp New Momentum1450.70.5f-0.4-0.5y1.01.7%bp Accelerated76-1.8-1.83-1.5-2.9D-0.2-0.5%bp Net Zero52-2.6-3.1#-1.9-4.1)-0.8-2.0%EIA Reference1651.41.00.40.51.11.7%EnerBase2183.32.0%EnerBlue90-1.3-1.2%EnerGreen28-3.5-5.2%Equinor Bridges36-3.2-4.3%Equinor Walls1300.10.1%ExxonMobil1611.20.9q-0.2-0.21.42.1%IEA Steps1260.00.0X-0.7-1.0h0.61.1%IEA APS74-1.9-1.92-1.6-3.0A-0.3-0.7%IEA NZE28-3.5-5.2%OPEC(2045)1591.20.8%Shell Archipelagos109-0.6-0.5Q-0.9-1.4W0.20.5%Shell Sky 205058-2.4-2.8%-1.8-3.91-0.7-1.7%Note:Where volumetric data are not available,we assume a conversion factor of 0.923 TCF/QBtu.34Resources for the Future35Global Energy Outlook:Peaks or Plateus?Table 11.Coal Consumption,by RegionQBtuWorldAverage annual growthWestAverage annual growthEastAverage annual growthQBtuQBtuCAAGRQBtuQBtuCAAGRQBtuQBtuCAAGR199088ndnd20101452.82.5C10220221611.40.9(-1.2-3.432.62.2 502022-20502022-20502022-2050 bp New Momentum91-2.5-2.0%9-0.7-4.0-1.8-1.7%bp Accelerated22-5.0-6.8%2-1.0-9.4 -4.0-6.5%bp Net Zero16-5.2-8.0%1-1.0-10.6-4.2-7.6%EIA Reference158-0.1-0.1-0.2-0.950.10.1%EnerBase132-1.1-0.7%EnerBlue39-4.4-4.9%EnerGreen21-5.0-7.1%Equinor Bridges11-5.4-9.2%Equinor Walls67-3.4-3.1%ExxonMobil91-2.5-2.0%6-0.8-5.2-1.7-1.6%IEA Steps96-2.3-1.8-0.6-3.3-1.7-1.6%IEA APS43-4.2-4.7%6-0.8-5.67-3.4-4.5%IEA NZE14-5.3-8.4%OPEC(2045)107-1.9-1.4%Shell Archipelagos110-1.8-1.4-0.6-3.2-1.2-1.1%Shell Sky 205042-4.3-4.7%4-0.9-6.57-3.4-4.4%Table 12.Nuclear Consumption,by RegionWorldAverage annual growthWestAverage annual growthEastAverage annual growthQBtuQBtuCAAGRQBtuQBtuCAAGRQBtuQBtuCAAGR199021ndnd2010290.41.56202228-0.1-0.2!0.31.4.22.3 502022-20502022-20502022-2050 bp New Momentum350.20.8-0.3-1.70.53.6%bp Accelerated480.72.0-0.1-0.710.84.9%bp Net Zero581.12.6!0.00.061.05.5%EIA Reference350.20.8-0.1-0.60.32.5%EnerBase621.22.9%EnerBlue892.24.3%EnerGreen882.24.2%Equinor Bridges390.41.2%Equinor Walls410.51.4%ExxonMobil430.61.6-0.1-0.3$0.64.0%IEA Steps450.61.80.00.1#0.53.8%IEA APS561.02.5&0.20.8(0.74.6%IEA NZE641.33.0%OPEC(2045)470.71.9%Shell Archipelagos25-0.1-0.3-0.3-1.60.11.4%Shell Sky 2050440.61.6$0.10.50.43.26Resources for the Future37Global Energy Outlook:Peaks or Plateus?Table 13.Global Electricity Generation,by SourceTWhCoalNatural gasHydropowerNuclearOther renewablesOilTotal19904,4031,7522,1422,0131721,24211,86420108,6694,8473,4562,75684296321,533202210,4286,5004,3782,682433770929,0332050 bp New Momentum6,6839,2566,0003,55024,30022750,015 bp Accelerated5073,3817,5744,95040,577156,990 bp Net Zero4532,5338,0635,87344,486161,410 EIA Reference9,6608,3075,6113,31315,5615642,509 EnerBase10,36815,5936,2706,27626,42051165,439 EnerBlue2,3547,4295,8819,16345,04537970,251 EnerGreen1,2763,4455,5718,92751,64217771,038 Equinor Bridges7511,2395,0023,65539,2202349,889 Equinor Walls4,5507,6735,9653,93525,31136547,799 IEA STEPS4,9786,2106,3514,35331,81827453,985 IEA APS2,2443,3197,4325,30148,31914466,760 IEA NZE6445118,2256,01561,444176,838 Shell Archipelagos4,9393,3897,4862,25344,32616762,560 Shell Sky 20502,2462,2905,2723,15158,2514771,257Note:Historical data from IEA.OPEC does not publish electricity data.Equinor excludes electricity generation used in electrolysis to produce hydrogen.ExxonMobil does not provide sufficient detail to calculate electricity generation in TWh.38Resources for the FutureTable 14.Global Renewable Electricity Generation,by SourceTWhHydropowerBiomass/wasteWindSolarGeothermalOtherTotal19902,142131403602,31320103,4563093423468894,29820224,3786872,1251,3071011178,7152050 bp New Momentum6,0001,05411,34911,6781665230,300 bp Accelerated7,5741,56821,12217,20940427348,151 bp Net Zero8,0631,24423,37618,42749794352,550 EIA Reference5,611nd5,8348,56425590821,173 EnerBase6,2709978,12616,973nd32532,690 EnerBlue5,88189624,09419,809nd24650,925 EnerGreen5,57173524,74425,992nd17257,213 Equinor Bridges5,0021,09618,24216,180nd3,70244,222 Equinor Walls5,9651,80511,44811,343nd71531,275 IEA STEPS6,3511,74611,80117,54243928938,168 IEA APS7,4323,00518,43225,39867780855,752 IEA NZE8,2253,05623,44232,7248621,36169,669 Shell Archipelagos7,4861,13720,68721,74425650151,812 Shell Sky 20505,2721,56222,27533,63735142763,523Note:OPEC does not present electricity generation data.Equinor and Enerdata include geothermal in“Other.”ExxonMobil does not provide sufficient detail to calculate electricity generation in TWh.Biomass/waste also includes biogas.39Global Energy Outlook:Peaks or Plateus?Table 15.Net Carbon Dioxide Emissions,by RegionWorldAverage annual growthWestAverage annual growthEastAverage annual growthMMTMMTCAAGRMMTMMTCAAGRMMTMMTCAAGR1990221462022360.41.50.0-0.10.54.2 502022-20502022-20502022-2050 bp New Momentum25-0.4-1.2%bp Accelerated7-1.0-5.5%bp Net Zero1-1.2-11.4%EIA Reference410.20.50.52.6-0.3-1.8%EnerBase370.10.2%EnerBlue15-0.7-3.1%EnerGreen6-1.1-6.2%Equinor Bridges-1-1.3NA Equinor Walls21-0.5-1.8%ExxonMobil26-0.4-1.20.21.1%8-0.5-3.8%IEA STEPS27-0.3-1.0%IEA APS11-0.9-4.1%IEA NZE1-1.3-13.3%OPEC(2045)34-0.1-0.2%Shell Archipelagos28-0.3-0.9%Shell Sky 20505-1.1-6.9%Note:Historical data from IEA.Net CO2 emissions include positive(gross)and negative emissions from sources such as direct air capture and bioenergy with CCS.CO2 emissions data include fossil fuel combustion and exclude industrial process emissions.bp and IEA regional data are excluded because they include methane emissions(bp),flaring(bp),and industrial process emissions(bp and IEA).Equinor Bridges emissions are negative in 2050,so it is not possible to calculate a compound average annual growth rate.Resources for the Future40References1.Grubler,A.Energy Transitions.In Encyclopedia of Earth(Environmental Information Coalition,National Council for Science and the 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In collaboration with AccentureAccelerating the Clean Hydrogen Economy in LatinAmericaI N S I G H T R E P O R TA U G U S T 2 0 2 4Images:Getty Images,MidjourneyDisclaimer This document is published by the World Economic Forum as a contribution to a project,insight area or interaction.The findings,interpretations and conclusions expressed herein are a result of a collaborative process facilitated and endorsed by the World Economic Forum but whose results do not necessarily represent the views of the World Economic Forum,nor the entirety of its Members,Partners or other stakeholders.2024 World Economic Forum.All rights reserved.No part of this publication may be reproduced or transmitted in any form or by any means,including photocopying and recording,or by any information storage and retrieval system.ContentsForeword 3Executive summary 4Introduction 81 Latin America in a global context 91.1 Clean hydrogen the global context 101.2 Renewable energy can unlock Latin Americas 12 clean hydrogen future 1.3 Three potential pathways for Latin American countries 162 Challenges to overcome in Latin America 202.1 Accelerating Clean Hydrogen Framework 212.2 Challenges across six dimensions 223 Enabling measures for Latin America 283.1 Roadmap of enabling measures 293.2 Key success factors:regional collaboration and coordination 32Conclusion 34Appendix:Country profiles 35Argentina 38Brazil 40Chile 42Colombia 44Mexico 46Panama 48Uruguay 50Contributors 52Endnotes 53Accelerating the Clean Hydrogen Economy in LatinAmerica2ForewordLast year was the warmest year on record,with global average temperatures 1.45 Celsius above the pre-industrial baseline,according to the World Meteorological Organization.1 With the past decade also the warmest on record,the quest to find sustainable solutions to address climate change and reduce emissions has become paramount.As nations across the globe commit to ambitious decarbonization goals,the pursuit of cleaner energy sources has taken centre stage.In the journey to achieve net-zero emissions objectives,clean hydrogen stands out as a promising avenue.In the next decades,clean hydrogen could play an important role in meeting global energy demand,while contributing in the region of 10%of emissions reductions by 2050.2 It will play a critical role in decarbonizing hard-to-abate sectors(e.g.steel and chemicals)where alternatives cannot fully decarbonize.At the same time in the wider energy ecosystem,it can provide a means of long-duration energy storage complementing intermittent renewables.Latin America,with its vast installed and potential renewable energy capacity,is poised to play a key role in advancing the clean hydrogen economy.The region can leverage its abundant solar,wind and hydroelectric resources to become a key player in the global clean hydrogen export market.Furthermore,investment in clean hydrogen infrastructure could help address energy security concerns and drive economic growth across the region.It is worth noting that uncertainties and complexities persist regarding the future of clean hydrogen markets,such as the development of cost-effective technologies and market competitiveness.To realize the potential of the clean hydrogen economy in Latin America,coordinated and decisive efforts are required.The urgency of the moment demands that governments,investors and businesses act with responsibility and ambition:Governments must move faster to create policy frameworks that provide incentives for investment and facilitate international collaboration,to accelerate the deployment of clean hydrogen technologies.Strategic investments from both public and private sectors are vital to reduce the costs of production and prices for end-users,allowing clean hydrogen to compete with grey hydrogen and other alternative fuels.Businesses must embrace innovation,invest in research and development and forge strong and reliable partnerships to drive the transition towards a sustainable hydrogen economy.While lessons learned from other regions of the world can provide a beneficial framework,regional nuances must be accounted for.As the region embarks on this transformative journey,it is essential that all actors approach the challenges ahead with resolve,optimism and a shared commitment to building a more sustainable world for future generations.We invite you to delve deeper into the pages of this report,which we hope provides valuable insights into the opportunities and pathways to accelerate the clean hydrogen economy in Latin America.We thank all community members,stakeholders and corporate leaders for their time and contributions to this report;and we look forward to continuing our collaboration as we navigate clean hydrogen challenges and solutions to deliver on a cleaner future.Roberto Bocca Head of Centre for Energy and Materials;Member of the Executive Committee,World Economic ForumAndrs Rebolledo Executive Director;Latin American Energy Organization,OLADEMuqsit Ashraf Group Chief Executive,Accenture StrategyAccelerating the Clean Hydrogen Economy in LatinAmericaAugust 2024Marisol Argueta de Barillas Head of the Regional Agenda,Latin America;Member of the Executive Committee,World Economic ForumAccelerating the Clean Hydrogen Economy in LatinAmerica3Executive summaryIn the global decarbonization landscape,clean hydrogen has become a crucial element for the energy transition.Given its potential to reduce global greenhouse gas(GHG)emissions in hard-to-abate sectors,such as heavy industry and long-distance transport,clean hydrogen has been gaining traction worldwide.Economies can foster its development through incentives and pilot projects that showcase the benefits of clean hydrogen,promote its production and encourage its demand.Latin America,with its vast potential in renewable resources(solar,wind and hydro power)can unlock clean hydrogen production at competitive cost,positioning it to become a major clean hydrogen-exporting region and hence a central player in the global clean hydrogen economy.Depending on their intrinsic characteristics,countries within the region have different short-and medium-term clean hydrogen economy development strategies and ambitions.As such,they may follow one of three potential pathways:net exporters,local decarbonizers,or focused players:Net exporters are countries whose focus is beyond domestic demand,aiming to trade most of their produced clean hydrogen in international markets.They seek to become globally competitive players through cost-effectiveness and the development of necessary trade infrastructure and certification schemes.Local decarbonizers are countries that are focused first on utilizing clean hydrogen to decarbonize their own economies and meet emission reduction targets,leaving exports to a later stage.Focused players adopt a more targeted approach to the development of clean hydrogen,focusing on its role complementing existing fuels or energy technologies in a particular application,such as shipping.These countries will prioritize actions that strengthen their position in relation to particular sectors or end-use applications.The World Economic Forum,in collaboration with Accenture,supports the ambitions of Latin America to become a central clean hydrogen player through the Transitioning Industrial Clusters Initiative,which works with stakeholders across industry,policy and finance to accelerate the clean hydrogen economy in the region.The aim of this report is to identify the challenges and key enablers to the development of the clean hydrogen economy in Latin America,as well as to establish the current maturity level of countries in the region regarding clean hydrogen.Challenges facing the development of the clean hydrogen economy in Latin AmericaWhile there is great potential to accelerate the clean hydrogen economy and become a net exporter in the long term,the regions main challenges are as follows:1 Low demand:Demand for clean hydrogen remains low for both local consumption and exports.Only a small number of offtake agreements are in place and few projects are reaching final investment decisions(FIDs).2 Slow pace of building dedicated infrastructure:Countries have announced several clean hydrogen hubs across the region,but few are under construction or aligned to market creation opportunities.3 Technology adaptation and workforce development:The region is still highly dependent on international manufacturers for key components(e.g.electrolysers).Technology adaptation to local requirements is needed and the sector must develop local highly skilled talent to support further growth.4 High cost preventing competitiveness:Despite competitive prices for renewable energy,there remains a large cost differential between clean hydrogen and conventional/grey hydrogen.Industries and markets are still unwilling to pay the price premium.5 Lack of standards and certification:While regional certification schemes for carbon attributes have advanced rapidly,the region needs a common definition of standards and guidelines to ensure the safe and reliable production,storage and transportation of clean hydrogen and its derivatives.As these regional schemes advance,they will need to integrate with global standards and certifications.Accelerating the Clean Hydrogen Economy in LatinAmerica4Enabling measures and key success factors to develop the clean hydrogen economyTo address the challenges outlined above,this report defines a series of objectives and enabling measures across six dimensions:1)standards and certifications,2)cost,3)technology and talent,4)demand,5)infrastructure and 6)pace of development.These enabling measures,while aimed primarily at governments and policy-makers,also require the participation of other actors in the value chain,including infrastructure,technology,finance and offtakers.The first three sets of enabling measures below are cross-cutting,while the second three differ by pathway for net exporters,local decarbonizers and focused players.Standards and certificationsRegional agreements and partnerships are needed to agree definitions for the technical,safety and carbon intensity standards and certifications of the clean hydrogen production value chain,including its derivatives.This approach is needed both to standardize regulations and accelerate their implementation in countries across the region.A“sandbox”approach can be utilized to rapidly test and deploy required regulations.CostTo reduce the high costs that prevent clean hydrogen from being price-competitive,targeted government support is needed through well-balanced incentives for clean hydrogen projects across the value chain.Collaboration between nearby industries around sharing resources,for example through industrial clusters,could lead to cost reductions through aggregation of demand and opportunities for scale,while supporting financing.Technology and talentOne of the main objectives across the region is to focus innovation and research and development(R&D)on scaling-up the technology needed across the clean hydrogen value chain(e.g.electrolysers,carbon capture and storage).For this to happen,greater funding is needed to establish research centres to ensure local technology development.Training programmes to upskill and reskill technical talent are required to support these technology advancements.DemandEnabling measures to drive demand vary between the three defined pathways,as follows:Net exporters must seek to develop early international demand,through signing long-term trade agreements with offtakers and defining operating rules for international trade.Local decarbonizers need to drive strong local demand for clean hydrogen.Industrial clusters can play a key role in aggregating demand and reducing offtaking risk.Focused players need to drive demand from the target sector they have defined to serve,for example by signing memorandums of understanding(MOUs),commercializing the technology and testing their value proposition.InfrastructureAlthough all countries in the region must expand or adjust their infrastructure to develop their clean hydrogen economies,there are different enabling measures for each pathway:Net exporters should focus their efforts on ports and transportation capabilities.Local decarbonizers should focus on creating centralized infrastructure,such as clean hydrogen hubs in strategic locations to streamline the production,distribution and internal consumption processes.Focused players should adapt and repurpose their current infrastructure for specific uses,such as localized refuelling stations to boost consumption.Pace of developmentTo accelerate the development of clean hydrogen economies,different enabling measures apply to each pathway:Net exporters must boost resource efficiency by coordinating the development of key infrastructure along the value chain with offtakers,promote knowledge sharing and propose innovative financing mechanisms.Local decarbonizers must coordinate the ecosystem of actors across the value chain,anchored by industrial clusters.Focused players need to design and test their value proposition to potential offtakers,involving them in the co-creation process.Accelerating the Clean Hydrogen Economy in LatinAmerica5Regional collaboration and coordination the key success factorCollaboration and coordination at both international and regional levels are key success factors in executing these enabling measures,exploiting synergies and advancing the clean hydrogen economy.Regional collaboration is especially important for Latin America opportunities include:1 Identifying regional synergies and opportunities to work togetherIn an industry that requires enormous scale and investment,working collaboratively can help distribute required efforts and risk,as well as create market consolidation and stability by aggregating regional supply and demand(e.g.through industrial clusters).Similarly it can help accelerate technology and infrastructure R&D by identifying mutual interests.2 Developing and aligning on regulatory frameworks and certification schemes Global and regional collaboration can accelerate and improve the effectiveness of appropriate regulatory frameworks and associated certification schemes.Learning from existing regulations and certifications,while adapting them to the Latin American context in a way that respects international standards,can create efficiency and synergy across the region and the world.To achieve this,both regional and international collaboration are equally imperative.3 Fostering global cooperation and sharing insights Regular communication with other nations can help countries gain an in-depth understanding of the challenges and bottlenecks facing the development of clean hydrogen.Fostering dialogue is crucial to share best practices and lessons learned,to build a platform from which to advocate for regional requirements,and to obtain support through multilateral organizations or partnerships with other nations.34 Pursuing an inclusive clean hydrogen economy approachAt a national and regional level,it is important to involve all relevant stakeholders that may be impacted by the development of the clean hydrogen economy.To ensure an inclusive and sustainable transition,it is crucial to convene stakeholders including ministries,industry and businesses,financial institutions,academic and research organizations,local communities and non-governmental organizations(NGOs)to share their perspectives,concerns and needs.4 5 Supporting citizens as the clean hydrogen economy emergesPublic acceptance for new technology adoption is crucial to maintain and secure the social licence to operate.Public awareness campaigns can help advocate for the role of clean hydrogen in the energy transition and its benefits for local communities.Additionally,collaboration with neighbouring countries to improve the regions visibility and promote it as an important clean hydrogen production hub could help attract greater international investment and support.Overview of regional progressWhile the challenges and enabling measures relate to the region,the clean hydrogen landscape in each country differs widely.Given the potential for renewable energy in the region,most countries anticipate that renewable/green hydrogen will see greater development compared to blue hydrogen (see Box 1 for definitions).This report provides a detailed analysis of the clean hydrogen landscape in Argentina,Brazil,Chile,Colombia,Mexico,Panama and Uruguay.The main highlights by country are as follows:Argentina expects that by 2030 more than 80%of its renewable/green hydrogen demand will come from international markets.The countrys National Strategy for the Development of the Hydrogen Economy,published in 2023,seeks to take advantage of its abundant renewable resources(including the largest potential for photovoltaic energy production globally)and strategically positioned ports that will be adapted for clean hydrogen exports.Argentina expects to renovate nine of its 16 ports by 2030 and aims to develop at least five clean hydrogen hubs.Brazil published its National Hydrogen Program(PNH2)in 2022.The purpose of PNH2 is to boost the clean hydrogen market and industry as an energy vector in Brazil,highlighting its relevance in the countrys energy transition and in achieving net zero by 2050.To accelerate progress,Brazil is investing in infrastructure for a renewable/green hydrogen hub at Pecm Port,while a Brazil-Netherlands maritime corridor is being established to facilitate renewable/green hydrogen exports to Europe.Chile published its National Green Hydrogen Strategy in 2020,the first such strategy in the region,with the objective of becoming a frontrunner in renewable/green hydrogen production and export.Accelerating the Clean Hydrogen Economy in LatinAmerica6Chile has the potential to produce the worlds cheapest renewable/green hydrogen by 2050,5 by exploiting its potential for more than 1,800 GW of installed renewable energy capacity by 2050 70 times the demand from domestic internal consumption.6 The government has drawn up a regulatory framework and fast-tracked three pilot initiatives for renewable/green hydrogen technology in production,mining and transport.Colombia made an early start with its Hydrogen Roadmap in 2021.The government is committed to decarbonization and the creation of public policies that promote the adoption of clean hydrogen at the local level.The country expects to improve its production capacity and infrastructure with 28 projects in the pipeline and six potential hubs operational in different regions by 2050.Mexico has not yet created a national strategy to develop the clean hydrogen economy.To date,the Mexican Hydrogen Association has led the way,publishing a renewable/green hydrogen roadmap up to 2050 to promote investment in developing renewable/green hydrogen to decarbonize the national economy.Most of the demand is forecast to come from the industrial and transportation sectors.Mexico has nine projects in development,all harnessing dedicated renewable energy sources for renewable/green hydrogen and ammonia production.Panama published its National Strategy for Green Hydrogen and Derivatives(ENHIVE is its Spanish acronym)in 2023.The countrys main goal is to develop its port infrastructure and become a major hub for green refuelling for the maritime sector,where clean hydrogen plays a key role.Panama has one project underway at the feasibility study stage(SGP BioEnergys bio-refinery),which aims to be operational by 2025 with a target of producing 405,000 tonnes of renewable/green hydrogen per year.Uruguay released its Green Hydrogen Roadmap in 2022,to help boost domestic demand for fuels such as ammonia and low-emission e-methanol for maritime transport.Uruguay is committed to integrating renewable/green hydrogen into its energy mix,by taking advantage of its logistics infrastructure and its experience in terms of regulation,legal requirements and political stability gained while developing renewables.The country is progressing with four projects focused on renewable energy sources for hydrogen and synthetic fuel production.Accelerating the Clean Hydrogen Economy in LatinAmerica7IntroductionThe development of the clean hydrogen economy is crucial for the fulfilment of decarbonization goals and the success of the energy transition around the world.Clean hydrogen holds great potential as a means to decarbonizehard-to-abate sectors,being both a clean energy carrier and a clean feedstock substitute for diverse industrial processes.In recognition of this opportunity,Latin American countries have started the journey towards developing their clean hydrogen economies.Leveraging their excess renewable energy capacity,most countries in the region have set out their ambitions and are beginning to execute.While following different pathways,the region as a whole aims at becoming a net clean hydrogen exporter by 2050.This report provides a comprehensive summary of the current state of the clean hydrogen economy in Latin America.Informed by consultations with key industry stakeholders and governmental organizations,this report describes the challenges and enabling measures that,if realized,could accelerate the production and use of clean hydrogen across the region.This report is structured as follows:Chapter 1:explores the regions role in the global clean hydrogen economy,its potential and the pathways likely to be followed by each of the seven countries.Chapter 2:provides insights into the challenges facing the development of the clean hydrogen economy in Latin America.Chapter 3:describes the enabling measures and key success factors to accelerate the development of the clean hydrogen economy.Conclusion:provides the reports final insights.Appendix:provides an in-depth view of seven prioritized countries with the highest potential to develop clean hydrogen in the region.The methodology followed to build the report consisted of both desk research and engagement with key stakeholders.The desk research included reviewing available reports,policies,laws,national strategies and roadmaps on current hydrogen development.This analysis was complemented by one-on-one interviews and focus groups with regional private and public stakeholders to validate findings on challenges and enabling measures.Finally,collaborative sessions were held to consolidate insights into lessons learned across the region and to identify and promote opportunities for cooperation.Clean hydrogen definitionBOX 1“Clean hydrogen”refers to hydrogen produced through the following two methods:Produced from water by electrolysis,powered from renewable sources known as“renewable”or“green”hydrogen.Produced from natural gas by a process of steam methane reforming(SMR),in conjunction with carbon capture and storage(CCS)abbreviated to SMR CCS and known as“blue”hydrogen.Both have significantly reduced emissions compared to conventional“grey”hydrogen.Green hydrogen is the most sustainable and preferred pathway,while blue hydrogen can contribute towards a rapid shift away from unabated fossil fuels.Accelerating the Clean Hydrogen Economy in LatinAmerica8Latin America in a global context1Clean hydrogen can play a key role within the global energy transition.Accelerating the Clean Hydrogen Economy in LatinAmerica9Given its potential to reduce the use of fossil fuels,clean hydrogen has been gaining traction as a crucial element to reduce global greenhouse gas(GHG)emissions in hard-to-abate sectors,such as aviation,shipping,trucking,aluminium,cement/concrete and steel,which account for around 25%of global GHG emissions(see Figure 1).While in industry,clean hydrogen can function both as a feedstock substitute in processes and as a heat source,it also plays a role as an energy carrier in heavy-duty transportation.Share of selected hard-to-abate sectors in global greenhouse gas emissionsFIGURE 1SteelCement/ConcreteAluminiumAviationShippingTruckingOther sectors Selected hard-to-abate sectors 25%of global GHG emissions75%3%2%4%2%6%8%Source:World Economic Forum.7 1.1 Clean hydrogen the global contextAccelerating the Clean Hydrogen Economy in LatinAmerica10Clean hydrogenElectrificationEnergy efficiencyFossil fuel-based CCUSRenewable energy-based CO2 removals(BECCS)Renewables10%6% %Moreover,at a global level,clean hydrogen is among the six leading technological avenues for reducing emissions.The technology could potentially contribute to around 10%of the emissions reductions required to reach net zero by 2050(see Figure 2).Global net-zero emissions reduction contributions of six technological avenues,by 2050FIGURE 2Notes:CCUS=Carbon capture,utilization&storage;BECCS=Bioenergy with carbon capture&storage.Source:Inter-American Development Bank,2023.8 Clean hydrogen could contribute to around 10%of the emissions reductions required to reach net zero by 2050.Accelerating the Clean Hydrogen Economy in LatinAmerica111.2 Renewable energy can unlock Latin Americas clean hydrogen futureAs a region endowed with vast renewable energy resources,Latin America is poised to become a significant clean hydrogen player in the coming years.In the period 2017-2022,renewable electricity capacity in Latin America grew by 81.7 GW,while it is forecast to grow by 154.5 GW in the period 2023-2028(see Figure 3).Solar and wind power are projected to be the main drivers of this growth.The continents abundant renewable energy capacity enables Latin America to be competitive in one of the key cost drivers of clean hydrogen production.This is a significant advantage,as renewable electricity accounts for 60%to 75%of the total production cost of clean hydrogen globally.10The advantage becomes evident in the differences between the regional and global“levelized cost of hydrogen”(LCOH)for renewable/green hydrogen.In Latin America,the current LCOH of renewable/green hydrogen is$3.70$5.90/kg(2020 prices),11 lower than the current global LCOH of$3.80$8.50/kg(2021 prices).12Global renewable electricity capacity growth by region,2005-2028FIGURE 30100200300400500Gigawatts(GW)EuropeanUnionUnited StatesIndiaLatinAmericaMENA*Sub-SaharanAfricaOthercountriesASEAN*2005-20102011-20162017-20222023-2028Notes:*ASEAN=Association of Southeast Asian Nations;*MENA=Middle East and North Africa.Source:IEA,2024.9Renewable electricity accounts for 60u%of the total production cost of clean hydrogen globally.Accelerating the Clean Hydrogen Economy in LatinAmerica12As shown in Figure 4,the regions levelized cost of renewable/green hydrogen by 2030 is forecast to be particularly low for production in the south of Argentina and Chile,north-western Brazil and northern Colombia and Venezuela.Global levelized cost of renewable/green hydrogen,by 2030FIGURE 4Levelized cost of renewable/green hydrogen($/kg H2)1.52.02.53.03.54.0Source:IEA,2021.13Accelerating the Clean Hydrogen Economy in LatinAmerica13These favourable conditions of high renewable energy capacity and low cost of clean hydrogen production can position the region as a potential net exporter to global markets,both in the medium-and long-term.By 2030,the region may fulfil 25%to 33%of global demand,competing with Australia(221%)and Africa(9%).14 By 2050,Latin America is predicted to be exporting clean hydrogen mainly to Europe and Asia,as reflected in Figure 5.To fulfil its potential and to capitalize on this opportunity,Latin America has been working on developing the required infrastructure.To date,11 potential clean hydrogen hubs16 have been identified across the region,in countries including Chile,Brazil and Panama(see Figure 6).At the same time,other potential exporting regions are working towards the same goal for example,the United States(US)has announced 10 hubs,while Australia has announced seven.17Expected global clean hydrogen trade flows and regional roles,by 2050FIGURE 5Region consumes more than it producesNeutralRegion produces more than it consumesMostly ShippedMostly PipedAlternative potential flows if optimal sources constrained20 Mt1-5 Mt5-10 Mt10-20 MtNet trade flows,million tonnes(Mt)of hydrogen per annumSource:Hydrogen Council,2022.15 Accelerating the Clean Hydrogen Economy in LatinAmerica14Potential clean hydrogen hubs in Latin AmericaFIGURE 61110234567891UruguayArgentinaChileColombia PanamaBrazilTrinidad and TobagoMexicoCurrent key hubsPotential key hubsSource:Inter-American Development Bank,2023.18 In summary,when compared with other regions,the clean hydrogen economy landscape in Latin America looks promising.The region is well-endowed with cost-competitive renewable energy resources that position it as net exporter by 2050.Nonetheless,other potential competitor regions are progressing as well,so it is important for Latin America to accelerate in this sector to build competitive advantage in the coming years.The following section explores the different pathways that countries in the region could follow and the challenges they will need to overcome to maximize the opportunities offered by the clean hydrogen economy.Accelerating the Clean Hydrogen Economy in LatinAmerica151.3 Three potential pathways for Latin American countriesWhile the region is likely to become a net exporter of clean hydrogen in the long run,countries within the region have different clean hydrogen development strategies and ambitions,which could see them follow one of three potential pathways:Net exporters Local decarbonizers Focused playersThis report allocates selected countries in the region to one of the three pathways,based on an analysis of their national hydrogen roadmaps and other relevant announcements(see Figure 7).These pathways are not intended to define a fixed route for each country nor to oversimplify the multiple efforts of countries now and in the future to transform their energy economies.The value of defining and allocating pathways is that it allows countries to prioritize key actions,based on their differing short-,medium-and long-term goals.The main characteristics of each pathway are detailed below.Potential clean hydrogen economy pathways for Latin American countries FIGURE 7MexicoUruguayArgentinaChileColombia PanamaBrazilNet exportersLocal decarbonizersFocused playersOut of scopeAccelerating the Clean Hydrogen Economy in LatinAmerica16Net exporters Countries that follow the net exporters pathway have strategies aimed at trading the majority of their clean hydrogen production to international markets.Roadmaps for countries within this category seek to position themselves as relevant global competitive players.To achieve this,they have focused initial efforts beyond production and are incentivizing the construction of dedicated clean hydrogen export infrastructure including ports and clean hydrogen hubs that will help reduce transportation costs and improve price competitiveness.Moreover,they have adopted certification schemes aligned to international standards,rather than creating national ones.They have built research centres and developed alliances(national,regional and international)to advance commercial agreements specifically focused on clean hydrogen trading.These net exporters have planned for a clean hydrogen economy that takes advantage of their countrys current capabilities and maximizes them for competitiveness in markets where demand is growing.Nevertheless,it is important to note that while these countries are focusing on exports,they are also targeting domestic sectors that will in turn contribute to national decarbonization goals and support the development of the domestic clean hydrogen economy.Two countries in the region have demonstrated ambition to become net exporters:Chile and Argentina.ChileChile,which has the potential to produce the worlds cheapest renewable/green hydrogen by 2050,offers an example of the projected pathway of a net exporter.With the potential for more than 1,800 GW of installed renewable energy capacity by 2050(70 times the countrys demand for internal consumption),19 Chile has the ambition to become a frontrunner in the race.In 2020,it was the first country in the region to publish a National Green Hydrogen Strategy and it has already reviewed that strategy to focus on execution at scale.Chile has captured$550 million of multilateral investment in clean hydrogen projects,$150 million from the World Bank20 and$400 million from the Inter-American Development Bank.21 In collaboration with the German government,Siemens Energy is developing the worlds first integrated commercial installation to produce climate-neutral fuel near the Patagonian city of Punta Arenas.In addition,the government is progressing the ratification of a trade agreement with the European Union(EU)that will allow clean hydrogen to be traded freely.ArgentinaDisplaying similar ambition,Argentina expects that by 2030 more than 80%of its demand for clean hydrogen will come from international markets.To implement its National Strategy for the Development of the Hydrogen Economy,published in 2023,the country is leveraging its abundant renewable resources(including the worlds largest photovoltaic energy potential)and its 16 strategically positioned ports,which can be adapted for clean hydrogen exports.Argentina expects to renovate nine of these ports by 2030 and aims to develop at least five clean hydrogen hubs.The Argentinian government is making progress in creating policies and standards.Lately,the“Promotion of Low Carbon Hydrogen and Other Greenhouse Gas Emissions”bill was passed with the purpose of promoting clean hydrogen production projects,organizing governance of the sector and encouraging productive and technological development along the entire value chain.Two countries in the region have demonstrated ambition to become net exporters:Chile and Argentina.Accelerating the Clean Hydrogen Economy in LatinAmerica17Local decarbonizersThe short-and medium-term goals for countries aligned to this pathway are mostly focused on decarbonizing the national economy and meeting emissions reduction targets,prioritizing a local clean hydrogen market and leaving exports to a later stage.To achieve this,local decarbonizers seek to replace conventional/grey hydrogen and enable new uses in hard-to-abate sectors through piloting solutions with clean hydrogen.These countries have not yet set clear demand projections for international markets and their confirmed projects seek to increase production capacity to meet future local demand and drive domestic consumption by reducing cost through government incentives.Countries that follow this pathway have or are developing national certifications for clean hydrogen with standards that can be different for domestic and international markets.This allows them to customize standards to meet local requirements,while also ensuring compliance with international standards and facilitating future commercialization to other markets.Three countries in the region have demonstrated ambition to become local decarbonizers:Brazil,Colombia and Mexico.BrazilBrazil,whose National Hydrogen Program(PNH)does not establish specific goals for clean hydrogen production and use,has nevertheless established clean hydrogen as central to the countrys energy transition to achieve net zero by 2050.Through PNH,the government has framed public policies and financial mechanisms including tax relief,green finance and dedicated funds for renewables to increase the competitiveness of the clean hydrogen sector.Through this approach,the government seeks to position Brazil as the country with the lowest production costs for clean hydrogen in the world by 2030,by which time approximately 60%of the countrys total clean hydrogen supply is expected to be consumed domestically.Although the countrys main near-term policies are aimed at boosting domestic demand,the Ministry of Mines and Energy expects the country to be a major global hydrogen exporter by 2050.To further this vision,a joint venture between the Port of Pecm,in the State of Cear,and the Port of Rotterdam is investing in building infrastructure for a renewable/green hydrogen hub at Pecm and a Brazil-Netherlands maritime corridor to facilitate the export of renewable/green hydrogen to Europe.ColombiaColombia,situated between two oceans,with a water supply six times the world average,22 10 port areas,plus wind and solar potential along its coastlines,has the potential to become an important global clean hydrogen logistics hub.However,the countrys near-term ambition is to decarbonize its economy through steering clean hydrogen production towards industrial and transportation applications.By 2050,the government expects 40%of the hydrogen consumed by the industrial sector to be clean hydrogen.23Colombias commitment to decarbonization is reflected in its public policies,which seek to boost domestic clean hydrogen consumption and reduce production costs by offering fiscal benefits associated with emissions reductions.One example is Law 2099 of 2021,which prioritizes investments from the non-conventional energy and efficient energy management fund(FENOGE)according to their impact on reducing emissions.MexicoMexico has favourable conditions to produce clean hydrogen,given its robust power and gas transmission networks,and hydro power,solar PV and wind plants.However,the country has not yet established a national strategy to develop a clean hydrogen economy.Even though there is no national hydrogen strategy,efforts have been led by the Mexican Hydrogen Association,which forecast that by 2030 most of the demand for clean hydrogen will come from the industrial sector(e.g.glass,cement,chemicals),while by 2050 most demand will come from the transportation sector.The country is progressing with nine projects that all harness dedicated renewable energy sources to produce renewable/green hydrogen and ammonia.Three countries in the region have demonstrated ambition to become local decarbonizers:Brazil,Colombia and Mexico.Accelerating the Clean Hydrogen Economy in LatinAmerica18Focused playersFocused players are those that have a much more targeted approach to the development of clean hydrogen.Countries following this pathway have limited the scope of hydrogen to a specific role where it complements an existing offering;consequently they will prioritize actions that further strengthen their position in that domain.PanamaPanama is a leading example of a focused player.In light of its strategic location as a logistics hub astride the Atlantic and Pacific Oceans,the country as part of its National Strategy for Green Hydrogen and Derivatives(ENHIVE)launched in January 2024 has designed a masterplan to create an industrial hub to produce,import,export and trade clean energy sources for the maritime sector.The plan focuses on bunkering products made with clean hydrogen,such as green ammonia and e-methanol.To date,the country has one project underway at the feasibility study stage(SGP BioEnergys bio-refinery),which aims to be operational by 2025 with a target of producing 405,000 tonnes of renewable/green hydrogen per year.Panama is also preparing a detailed study on the potential demand for green ammonia,e-methanol and renewable/green hydrogen to fuel ocean-going vessels transiting the Panama Canal,with growth projections for 2030,2040 and 2050.UruguayUruguays strategy for developing a clean hydrogen economy is focused on supplying local demand for fuels,such as hydrogen for trucking and low-emission ammonia and e-methanol for maritime transport.In its most optimistic local demand scenario,Uruguay predicts that hydrogen fuel-cells will power approximately 3%of heavy-duty vehicles by 2030,increasing to 35%by 2050.The country is moving forward with four projects,each at various stages of development and focusing on renewable energy sources for clean hydrogen and synthetic fuel production.For example,the H24U project,previously known as Proyecto Verne,is at the feasibility study stage,aiming to be operational by 2025 with a target of installing 5 MW of clean hydrogen production capacity.Meanwhile,the Paysandu green hydrogen project,also at the feasibility study stage,has set its sights much higher:by 2026,it is planning to produce 256 million litres of eGasoline per year(using 100,000 tonnes of renewable/green hydrogen).24 Focused players are countries that have limited the scope of hydrogen to a specific role where it complements an existing offering.Two countries in the region have demonstrated focused ambition:Panama and Uruguay19Accelerating the Clean Hydrogen Economy in LatinAmericaChallenges to overcome in Latin America2Demand is still lagging for both domestic and export markets,while dedicated clean hydrogen infrastructure and technology advancements are required to accelerate the pace.Accelerating the Clean Hydrogen Economy in LatinAmerica20Despite the regions potential to become an important player and net exporter in the global clean hydrogen economy,Latin America faces a variety of barriers.From low demand and scarce local infrastructure to technology challenges and high costs,the journey to develop the clean hydrogen economy remains highly uncertain.This chapter applies the Accelerating Clean Hydrogen Framework(developed by the World Economic Forum in collaboration with Accenture)to review the challenges hampering the progress of the clean hydrogen sector in the region.In applying this framework to Latin America,differences and commonalities at a country level can be identified.2.1 Accelerating Clean Hydrogen Framework Standards and certification Cost Technology and talent Demand Infrastructure Pace of developmentFor each dimension,high-level objectives define the priority actions required to overcome the barriers within that dimension that impede the acceleration of the clean hydrogen economy in Latin America(see Figure 8).The Accelerating Clean Hydrogen Framework provides six dimensions through which to analyse the current state of Latin Americas clean hydrogen economy:World Economic Forums Accelerating Clean Hydrogen FrameworkFIGURE 8Cross-cutting challenges Pathway-specific challenges Standards&certificationsEnsure clarity on carbon intensity,safety and technical standards and certifications for projects across the value chain.DemandDrive critical mass demand through major clean hydrogen projects to ensure high supply.Leverage domestic and international targets to create stable,long-term demand.InfrastructureAlign clean hydrogen hubs and infrastructure with market creation,ensuring first ramp-up of“no regret”infrastructure:clean electricity,CCS,transport,storage,conversion and trade facilities.Pace of developmentAccelerate slow pace of clean hydrogen scale-up and development to drive economies of scale,coordinating the ecosystem.Technology&talentFocus on innovation and R&D to improve bankability and cost,efficiency and durability of electrolysers,renewables and CCS.Adapt workforce and skills to deploy new technologies.CostRemove cost and regulatory barriers for production and support the bankability of projects for investors.Clean hydrogen accelerationStandards&certificationsCostTechnology&talentInfrastructureDemandPace ofdevelopmentObjectivesAccelerating the Clean Hydrogen Economy in LatinAmerica212.2 Challenges across six dimensionsThe following sections analyse the challenges the Latin America region faces in each of the six dimensions outlined in the Accelerating Clean Hydrogen Framework.The first three dimensions standards and certification,cost,technology and talent display commonalities across the three clean hydrogen development pathways and therefore do not require differentiated analysis.However,the second three dimensions demand,infrastructure,pace of development require a differentiated analysis that addresses the particularities of each pathway.Cross-cutting challenges Standards and certification There have been important efforts in the Latin America region to establish standards that enable the development of the clean hydrogen economy as well as efforts to build clean hydrogen certification schemes.The main challenges relate to:Lack of standards for production and utilization of clean hydrogen:this generates uncertainty for producers,offtakers and investors in the region.The absence of even minimal regulation creates loopholes and uncertainties around required processes to be followed.Lack of alignment between domestic and international standards:some countries in the region either have no certification schemes in place or are building domestic schemes that are not aligned to international standards.This not only threatens the legitimacy of the clean hydrogen being produced,but also creates barriers to offtakers in managing differences from one country to another in the region.CostClean hydrogen production is not yet cost-competitive in comparison to conventional/grey hydrogen and other fossil fuel alternatives;consequently the business case for investing in clean hydrogen is not yet sufficiently convincing.The two main variables driving the production cost of clean hydrogen are:Cost of electrolysers:In 2022,the average global cost of electrolysers ranged from$1,400 to$1,770 per kWe.25 By 2030,this cost is expected to be 3.5 times lower.26 Despite this encouraging global trend,current prices present a challenge for large-scale clean hydrogen projects in Latin America.Cost of renewable energy generation:Although the cost of renewable energy,both wind and solar,has decreased by more than 70%globally over the past decade,the levelized cost of electricity(LCOE)must continue to decrease to ensure a competitive cost for clean hydrogen against its conventional/grey alternative.According to the International Renewable Energy Agency(IRENA),27 electricity costs of$0.02/kWh are needed for competitive hydrogen production.While some Latin American countries like Mexico,Uruguay and Brazil had achieved a LCOE between$0.02/kWh and$0.05/kWh for onshore wind electricity generation by 2022,this is not yet the case across the board.28 70%drop in renewable energy costs globally in past decade electricity at$0.02/kWh needed for competitive H2 production.Accelerating the Clean Hydrogen Economy in LatinAmerica22In addition to these two main cost variables,costs along the entire value chain need to be taken into account,such as for construction,operating,maintenance and transportation.A lack of public policy to incentivize investment and improve project bankability in Latin America has hampered the development of clean hydrogen projects.While governments in other regions provide investors,producers and offtakers with incentives to develop and utilize clean hydrogen,such as fiscal incentives and government financing,Latin America still lags behind in the robust policies needed to encourage development in the sector.Technology and talentTo increase the feasibility of clean hydrogens usage as a central component in the energy transition,there needs to be further development in the effectiveness and availability of technology,such as electrolysers and carbon capture and storage(CCS),as well as investment in the right skills to operate that technology.Globally,there is scale-up underway for clean hydrogen technology.While the global announced electrolyser manufacturing capacity was around 10 GW/year in 2021,by 2030 it is predicted to be over 130 GW/year.Europe and China will be the largest manufacturers by the end of the decade(see Figure 9).Improvements in electrolyser efficiency,as well as CCS and infrastructure,are required to unlock the full potential of a clean hydrogen economy.Latin America is subject to specific operational conditions,such as poor water quality,which could affect the efficiency and effectiveness of technology that has been developed elsewhere.For example,an important distributor of natural gas in Colombias north-east measured just 35fectiveness of an imported electrolyser at one of its pilot projects.As this case shows,electrolysers need to be adapted to the regions particular characteristics,where largely saline water sources requiring desalinization may affect the effectiveness of existing technologies and increase costs.29 Domestic research and development(R&D)is needed to adapt emerging technologies to local conditions,both in production and offtake.Latin America currently faces key challenges in terms of the availability of a skilled workforce equipped with the necessary capabilities across the clean hydrogen value chain.In a survey conducted by the Institute of the Americas in 2022,when asked about the main elements limiting current workforce participation in the energy transition,“lack of the right skills”was mentioned by around 25%of respondents.30Global announced electrolyser manufacturing capacity in GW/year,2021-2030FIGURE 9501001500202320222021.2030EuropeChinaNorth AmericaIndiaRest of the worldUnspecifiedGigawatts(GW)Source:IEA,2022.31 Global announced electrolyser manufacturing capacity was 10 GW/yr in 2021 by 2030 it is predicted to be 130 GW/yr.Accelerating the Clean Hydrogen Economy in LatinAmerica23Pathway-specific challenges DemandAccording to IRENA,32 global demand for hydrogen,mostly clean hydrogen,will not take off until 2035.Moreover,the global trend suggests that by 2050,two-thirds of production is projected to meet domestic demand,while the remaining one-third will be for export.Latin America faces challenges to foster demand development to match potential supply.Depending on their specific pathways,Latin American countries face different concerns.Net exporters:Net exporters need to address international demand and secure international offtakers to ensure their role in global trade dynamics.Even with global projected demand,Latin America lacks sufficient signed offtake agreements to secure demand and provide strong certainty to emerging clean hydrogen suppliers.As clean hydrogen gains prominence,countries will compete for market share.Net exporters need to ensure they can produce sufficient quantities of clean hydrogen at very low prices to gain and maintain competitiveness in global markets.It is essential to reduce prices,particularly of transport and storage technologies.Developing sufficient supply capacity to provide a reliable source of clean hydrogen for importing nations will be an important challenge to overcome.Challenges regarding regulation compliance and alignment with international standards will arise if production methods do not align with international regulations.Local decarbonizers:Insufficient local demand will prevent the acceleration of these countries domestic clean hydrogen economies.Local decarbonizers need to understand the challenges that hard-to-abate industries face in developing clean hydrogen adoption.The required acceleration in switching local demand from conventional/grey hydrogen to clean hydrogen must come from growth in existing uses(e.g.refining,ammonia,methanol),as well as from the development of new uses(e.g.transport,iron and steel,cement)see Figure 10.Focused players:In the case of focused players,there is high uncertainty around the number and consistency of potential customers and specific use-cases for clean hydrogen,both in the short-and long-term.Given that the adoption of technologies that enable the use of clean hydrogen requires investment from customers to adapt their existing assets and/or machinery,frictions around this process could impede the growth in demand for clean hydrogen.24Accelerating the Clean Hydrogen Economy in LatinAmericaHydrogen demand in Latin America,million tonnes(Mt),2019-2030FIGURE 10Mt H2/year012345674.10.30.50.40.30.20.70.36.82019 demandGrowth in existing uses by 2030Growth in new uses by 20302030 demand(accelerated case)RefiningNH3 productionMeOH productionDirect reduced ironTransportIron and steelCement1.31.20.41.2Notes:NH3=ammonia,MeOH=methanol.Source:IEA,2021.33 InfrastructureCurrent and new uses of hydrogen require infrastructure and technology development.There is a significant lack of dedicated infrastructure for the transportation and storage of clean hydrogen,posing a key obstacle for the industrys development.Moreover,with the projected rising demand for clean hydrogen across various sectors in upcoming decades,the development of broader clean hydrogen transport networks,potentially cross-border,will be necessary to meet this growing demand.34 Net exporters:Net exporters need to develop dedicated infrastructure for clean hydrogen exports (e.g.with regard to transportation technologies and ports).Latin America has an immature clean hydrogen infrastructure that needs to be developed and scaled-up.Transportation infrastructure is one of the biggest challenges countries face to fully develop their clean hydrogen value chains.Existing infrastructure can provide a basis to begin developing the clean hydrogen value chain:for example,Latin America has numerous operational and announced port infrastructure projects for trading ammonia and methanol(see Figure 11).However,this will not be sufficient to fulfil the future needs of the clean hydrogen economy.Although Latin America can leverage its existing oil and gas(O&G)infrastructure and retrofit for hydrogen transportation,the feasibility of these changes and its cost efficiency is still to be tested and depends largely on technology development.Accelerating the Clean Hydrogen Economy in LatinAmerica25Global existing and announced port infrastructure projects for clean hydrogen and hydrogen-based fuel tradeFIGURE 11AmmoniaGaseous H2Liquefied H2MethanolOperationalAnnouncedSource:IEA,2023.35Local decarbonizers:Local decarbonizers face significant challenges due to the lack of centralized infrastructure to easily integrate the clean hydrogen value chain.This hinders the scalability and cost-effectiveness of clean hydrogen projects in the region,impeding the sectors potential to contribute to decarbonization efforts and sustainable development.Focused players:Focused players need to adapt their existing infrastructure for clean hydrogen production to maximize their current advantages,which may include beneficial geographic location or industry strengths(e.g.maritime and aviation).These adaptations are necessary to enable efficient production,transportation and storage of clean hydrogen,as well as to facilitate its integration into other sectors.Any adaptations of existing infrastructure will need to comply with global quality and safety standards.Significant challenges include assessing the feasibility of adapting existing infrastructure as well as addressing the absence of suitable infrastructure.Pace of developmentGreater coordination between ecosystem actors is needed to drive economies of scale and accelerate the development of the clean hydrogen economy.Net exporters:Lack of collaboration between key actors in export markets is hindering project acceleration and the establishment of offtake agreements.An absence of effective coordination between public and private sectors poses a significant challenge to the expansion of the clean hydrogen export economy in Latin America.Without strong collaboration,the pipeline of clean hydrogen projects may be blocked by delays in regulatory approvals,difficulties in accessing finance and a lack of clarity around offtake agreements.Without strong collaboration,the pipeline of clean hydrogen projects may be blocked by delays in regulatory approvals,difficulties in accessing finance and a lack of clarity around offtake agreements.Accelerating the Clean Hydrogen Economy in LatinAmerica26 Addressing these challenges and fostering a cohesive partnership between the public and private sectors are crucial to accelerate the development and deployment of clean hydrogen initiatives,enabling Latin America to fully leverage its potential as an exporter.Local decarbonizers:Local decarbonizers require different actors to coordinate across the value chain to accelerate the integration of clean hydrogen into key industries.Countries face a challenge in synchronizing action across different players in the value chain,particularly between suppliers,current and future industry offtakers and policy-makers.Achieving coordination requires strategic planning,regulatory support and timely investments.Focused players:Given these countries target specific markets or stages of the clean hydrogen value chain,it is critical for them to design and deliver competitive value propositions to potential offtakers.Overcoming technical and infrastructure barriers for safe and efficient clean hydrogen production,as well as securing sufficient investment,are key obstacles that must be addressed.Greater attention must be given to the essential task of building collaboration among stakeholders,including maritime and aviation companies,technology providers,regulatory bodies and investors.Accelerating the Clean Hydrogen Economy in LatinAmerica27Enabling measures for Latin America3To overcome current challenges and pivot from piloting to execution at scale,key enabling measures need to be prioritized.Accelerating the Clean Hydrogen Economy in LatinAmerica283.1 Roadmap of enabling measuresUsing the World Economic Forums Accelerating Clean Hydrogen Framework,Chapter 2 identified existing barriers and challenges facing the development of the clean hydrogen economy across the region.This chapter presents a roadmap of enabling measures that can be classified into four categories(see Figure 12):Technology evolution and R&D Standards and certification Markets and financing Matching supply and demandThe enabling measures provide key actions and initiatives to help public and private players overcome the regions cross-cutting challenges,such as technology and talent,cost,standards and certification,and the barriers that are more specific to each of the three pathways infrastructure,demand and pace of development.Figure13 presents the six barriers,frames objectives to overcome each barrier and details the enabling measures required to achieve those objectives.Categories of enabling measuresFIGURE 12Technology evolution and R&DStandards and certificationsMarkets and financingMatching supply and demandRenewables and CCS procurementCertificates of origin(Carbon)contracts for difference(C/CfD)Supply quotasGas blending mandatesPublic tendersFiscal incentivesInvestor risk reductionCarbon pricingLife-cycle CO2e thresholdsTrade and shipping regulationsDedicated industry loansNote:Within the four categories,items are examples and not exhaustive.Accelerating the Clean Hydrogen Economy in LatinAmerica29Roadmap of enabling measures to accelerate Latin Americas clean hydrogen economyFIGURE 13BarrierObjectiveEnabling measuresEnabling measures type:Technology evolution and R&D Standards and certifications Markets and financing Matching supply and demandStandards and certificationEnsure clarity on technical,safety and carbon intensity standards and certifications.(All pathways)1a.Promote regional agreements and partnerships to standardize regulations.1b.Define technical standards for the clean hydrogen production value chain(e.g.transportation,storage,conversion).1c.Define technical standards for clean hydrogen derivatives(e.g.ammonia,synthetic fuels).1d.Create industrial safety and security standards and workforce training systems for whole clean hydrogen value chain.1e.Define technical standards for new parts of the value chain beyond production(e.g.infrastructure).CostReduce or eliminate costs related to hydrogen conversion,storage and transport.(All pathways)2a.Decrease investment costs for renewables,electrolysers and CCS with dedicated support.2b.Unify multiple funds available as a one-stop-shop(e.g.fiscal incentives,funds to ease additionality rules for first movers and to cover cost gap of clean hydrogen production).2c.Encourage collaboration to share renewables and CCS resources between nearby industries and/or among clusters to lower costs.Technology&talentFocus innovation and R&D to enable technology scale-up.(All pathways)3a.Redirect R&D investment from O&G to clean hydrogen;establish R&D centres to ensure scale-up of new technology.3b.Identify critical skills and develop strategy to ensure highly qualified workforce is available.3c.Increase funding for clean hydrogen-related research and encourage public-private partnerships.DemandDevelop international demand and offtakers.(Net exporters)4a.Boost global collaboration and alignment with relevant clean hydrogen market design and rules(including for derivatives).4b.Guarantee stable international demand using signed long-term agreements with offtakers.Drive strong local clean hydrogen demand.(Local decarbonizers)5a.Enable better tracking/traceability on allowed carbon intensities/emissions to drive industry demand for clean hydrogen.5b.Establish robust industrial clusters(e.g.public sector,energy producers,technology providers and investors)to drive decarbonization in key sectors.5c.Focus incentives on sectors with high energy consumption and significant emissions,such as heavy industry,transportation and power generation.Boost demand from the sector served.(Focused players)6a.Identify high-value/efficient applications,including derivatives,and define targets by end-use sector.6b.Sign MOUs and commercialization agreements with target sectors.Drive major clean hydrogen projects to ensure enough supply.(All pathways)7a.Initiate extensive public-private,private-private and public-public partnerships for clean hydrogen development.7b.Incentivize the development of clean hydrogen valleys/hubs through promotion of regional and sectoral targets.7c.Promote an increase in demand by developing technology for new uses of clean hydrogen(e.g.transportation,iron and steel).Accelerating the Clean Hydrogen Economy in LatinAmerica30FIGURE 13BarrierObjectiveEnabling measuresEnabling measures type:Technology evolution and R&D Standards and certifications Markets and financing Matching supply and demandInfrastructureDevelop dedicated infrastructure for clean hydrogen exports.(Net exporters)8a.Develop dedicated clean hydrogen export infrastructure,including ports and shipping capabilities.8b.Establish clean hydrogen hubs,focusing on areas near major industrial centres or ports to facilitate exports.8c.Incentivize the construction of clean hydrogen infrastructure with funding and capacity payments.Create a centralized infrastructure for clean hydrogen.(Local decarbonizers)9a.Establish clean hydrogen hubs in strategic locations to streamline production,distribution and internal consumption processes.9b.Plan to retrofit existing O&G infrastructure with required clean hydrogen infrastructure(e.g.pipelines,storage,usage).9c.Specify interoperable quality standards and definitions to enable integration with existing infrastructure.Adapt and reuse infrastructure for specific uses.(Focused players)10a.Drive connecting and planning of localized refuelling stations.10b.Collaborate with stakeholders for optimal distribution of production and consumption sites to ensure required supply chain infrastructure evolves.Pace of DevelopmentAccelerate pace of hydrogen scale-up and development to drive economies of scale.(Net exporters)11a.Drive automation of electrolyser production and increase raw material efficiency.11b.Provide innovative financing mechanisms to enable high capital investments required to develop clean hydrogen technology and infrastructure.11c.Co-develop infrastructure internationally and promote knowledge exchange.Coordinate ecosystem.(Local decarbonizers)12a.Develop and publicize dedicated clean hydrogen strategy(ensure sector-specific production,infrastructure and end-use targets are aligned).12b.Orchestrate different actors across value chain anchored by industrial clusters.12c.Establish robust but flexible regulatory frameworks to clarify clean hydrogen terminology,plus well-defined rules and incentives along value chain.Design and test the value proposition.(Focused players)13a.Design and test value proposition to potential clients,while actively involving them in co-creation process.13b.Execute detailed studies of potential demand of target sector/product and its growth projection,to plan hydrogen production capacity around demand forecasts.Roadmap of enabling measures to accelerate Latin Americas clean hydrogen economy(continued)Accelerating the Clean Hydrogen Economy in LatinAmerica313.2 Key success factors:regional collaboration and coordination Regional collaboration and coordination will be essential to successfully execute the different enabling measures needed to accelerate the clean hydrogen economy in Latin America.Unlike in the EU or US,where there is centralized leadership to help countries or states coordinate their efforts,Latin America requires an innovative approach towards building effective collaboration between different countries to capture the benefits of a regional approach.The following success factors,outlined below,showcase the importance of both regional and international collaboration and coordination,and should be considered when planning and executing the regions journey towards a clean hydrogen economy:Identify regional synergies and opportunities to work together.Develop and align on regulatory frameworks and certification schemes.Foster global cooperation and sharing of insights.Pursue an inclusive clean hydrogen economy pathway.Support citizens as the clean hydrogen economy emerges.Identify regional synergies and opportunities to work togetherIn an industry that requires enormous scale and investment,working collaboratively can help distribute both effort and risk,as well as create market consolidation and stability by aggregating regional supply and demand.To this end,the Transitioning Industrial Clusters initiative of the World Economic Forum,created in collaboration with Accenture and the US-based Electric Power Research Institute(EPRI),has improved cooperation and common vision between co-located companies and governments to drive economic growth,employment and the energy transition.This industrial cluster approach can accelerate the clean hydrogen economy by:Aggregating demand reducing offtaking risk.Creating shared infrastructure reducing individual investments and improving access to financing and grants.Enabling development of larger projects leveraging economies of scale.Providing a global forum,where clusters can learn from others and replicate successful models.Collaboration is also key at a regional level:For technology and infrastructure development,the identification of high-level R&D opportunities of mutual interest based on complementary strategies can reduce duplicated efforts and accelerate progress through the creation of bilateral or multilateral research collaborations.36 It can help improve the regions visibility,strengthen its negotiating position with international offtakers,and promote it as an important clean hydrogen production hub,enabling it to attract greater external investment and additional support.Accelerating the Clean Hydrogen Economy in LatinAmerica32Develop and align on regulatory frameworks and certification schemes Global and regional collaboration are important to ensure an effective clean hydrogen regulatory framework and certification process.Learning from existing regulatory frameworks,such as the EUs,can offer ideas and opportunities.Collaboration between countries in the region could help ensure existing frameworks are adapted to the Latin American context.A relevant example of regional collaboration in Latin America is CertHiLAC a joint effort between the Inter-American Development Bank(IDB)and the Latin American Energy Organization(OLADE)to create a certification system for clean hydrogen production in Latin America and the Caribbean.It was launched in November 2023 and already more than a dozen countries have signed up.Given that most clean hydrogen demand will be met through international trade,the coordination of standards and alignment of certification is vital to guarantee compliance around rules of origin and sustainability practices.However,while a global homogeneous certification scheme is preferable,it could take considerable time to develop.In the meantime,strong international and regional cooperation is needed,through initiatives that provide transparency and limit divergence between standards.37Foster global cooperation and sharing of insights By playing an active role in global clean hydrogen communities and industry groups,countries can help foster an in-depth understanding of global challenges and bottlenecks hampering the development of the clean hydrogen economy.Sharing best practices and lessons learned is an important priority to help countries resolve bottlenecks and find innovative solutions to address current challenges.Latin American countries should seek to participate in global collaboration networks and technology efforts to accelerate the global market.Opening up spaces for dialogue with global partners could provide Latin American countries with a platform to advocate for special requirements,such as innovative financing mechanisms or policies,and to seek support through multilateral organizations or partnerships with other nations.38Pursue an inclusive clean hydrogen economy pathwayAt a national and regional level,it is important to involve all relevant stakeholders who could be affected by the development of the clean hydrogen economy.It is crucial to convene ministries,industry and businesses,financial institutions,academic and research organizations,local communities and NGOs to share their perspectives,concerns and needs in order to ensure an inclusive and sustainable transition.39 Support citizens as the clean hydrogen economy emergesPublic acceptance is critical for the adoption of new technologies,as it provides a social licence to operate in new ways.Latin American countries should launch public awareness campaigns to inform citizens about the benefits of clean hydrogen,including its role in reducing emissions and creating jobs.Engaging with communities to address their concerns and highlight local benefits is an important priority to gain public acceptance for major new projects and will help accelerate clean hydrogen development across the region.Accelerating the Clean Hydrogen Economy in LatinAmerica33ConclusionTo accelerate the clean hydrogen economy in Latin America,targeted action and collaboration are needed not just locally,but regionally and internationally.Latin America has the potential to be a competitive player in the global clean hydrogen economy.Its access to vast renewable energy resources positions it to become a net exporting region in the long term.Along with its potential role in decarbonizing regional economies,clean hydrogen also provides an opportunity to foster social and economic growth.This report has presented three distinct clean hydrogen pathways that countries in the region are likely to follow,each with its own specific objectives,challenges and enabling measures.Some countries will focus initially on exporting most of their production(“net exporters”);some will look to prioritize the development of their domestic clean hydrogen demand to decarbonize their economies(“local decarbonizers”);and some will follow a targeted,sector-based approach,using clean hydrogen to complement existing solutions(“focused players”).By prioritizing enabling measures specific to their pathways,countries can move rapidly from planning to action at scale.For example:Net exporters should focus on advancing international offtake agreements to guarantee stable demand,as well as accelerating the construction of dedicated transportation and port infrastructure.Local decarbonizers should leverage industrial clusters to promote the integration of the clean hydrogen value chain for large-scale projects.Clusters can help build connections between supply and demand,create economies of scale through shared infrastructure and distribute risks.Focused players should engage with potential sector-specific offtakers to understand how clean hydrogen can fulfil their needs and how best to adapt existing infrastructure to serve those needs.Underpinning these measures,Latin American countries must bear in mind the key success factors outlined in this report,including:identification of regional synergies and opportunities to work together;fostering cooperation and collaboration;obtaining community buy-in;and sharing lessons learned from countries at more advanced stages of maturity.These factors will prove essential in accelerating progress towards addressing mutual challenges and bottlenecks.Above all,to deploy the success factors outlined in this report effectively,countries must seek collaboration and coordination across the region and internationally.The World Economic Forum,in collaboration with Accenture and other partners,will continue to support the development of the clean hydrogen economy in Latin America,through strategic initiatives such as the Transitioning Industrial Clusters(TIC)initiative and the Mobilizing Investment for Clean Energy in Emerging Economies(MICEE)initiative to enable collaborative actions to scale-up clean energy finance in emerging and developing markets.Accelerating the Clean Hydrogen Economy in LatinAmerica34Appendix:Country profilesSeven countries were selected as high-potential players in the clean hydrogen economy in Latin America.Accelerating the Clean Hydrogen Economy in LatinAmerica35Methodology for country selectionFive indicators were considered to identify the seven countries that should be prioritized for this analysis and to understand the current and potential maturity of the clean hydrogen industry in the region,as well as the enablers available to accelerate its development(see Box 2 and Figure 14).7prioritized countriesBrazilUruguayArgentinaChileMexicoPanamaColombiaPrioritization scoreLowHighCountry prioritization scoring mapFIGURE 14Five indicators to select countries and the underlying criteriaBOX 2 Strategy Clean hydrogen strategy,ambition and policy extent.Materiality Projected production volumes,projected demand for clean hydrogen,current use of hydrogen(conventional/grey clean)and expected market value.Current projects Number of projects currently underway promoting development of clean hydrogen industry.Infrastructure Projected infrastructure for the production and transportation of clean hydrogen(e.g.electrolyser capacity,maritime port readiness).Investment Announced investments for clean hydrogen projects as well as a consideration of projected public-private investment.Accelerating the Clean Hydrogen Economy in LatinAmerica36Following country selection,clean hydrogen-readiness assessments were conducted for each country.These assessments included an analysis of the state and maturity of the entire clean hydrogen value chain,considering variables such as targets,policies,preliminary accelerators and barriers.The assessments in turn provided the basis for developing a policy and funding landscape analysis for each of the seven countries,providing a clear picture of the present and potential future clean hydrogen economies across the region.This country-by-country landscape analysis is presented below.Notes on data1 Levelized costs of hydrogen(LCOH)detailed below for each country are projections and do not necessarily correspond to the real cost of production.This is because existing clean hydrogen projects are mostly pilots and there are currently no large-scale projects in operation.2 Production volumes detailed below for each country are based on country statements and are often goals rather than precise estimations,leading to potential deviations from production numbers stated in previous chapters.Accelerating the Clean Hydrogen Economy in LatinAmerica37ArgentinaCOUNTRY PROFILEPopulation 45.8 million(2023)GDP$631 billion(2022)GDP per capita$13,709 CO2e emissions 382.9 Mt(2022)Installed renewable capacity40 15 GWNatural gas production 140 million m(2023)Ammonia imports(value)$225,000(2021)Gas pipelinesPortsCurrent infrastructure41,42Facts and figures Current advancements in enabling measures44TodayLCOH/kg:SMR CCS/Blue:$1.10-$2.10 Renewable/Green:$2.80-$6.40Current H2 demand/yr:0.4 Mt Demand focused on:Fertilizers,refining,steel industry,methanol and other chemicals2030LCOH/kg:SMR CCS/Blue:$1.10 Renewable/Green:$1.70Domestic H2 production/yr:Goal of 1 Mt by 2035Expected local demand:0.02 Mt of clean H2 Exports of 0.3 Mt2050LCOH/kg:SMR CCS/Blue:$1.10 Renewable/Green:$1.40Domestic H2 production/yr:Goal of 5 Mt of clean H2 20%(1 Mt/yr)will be designated for the local market remaining 80%(4 Mt/yr)will be for export Standards and certificationsArgentina is set to implement a certification of origin system by 2030,based on emissions criteria,free of technological bias and aligned to adopting markets.In 2023,the“Promotion of Low Carbon Hydrogen and Other Greenhouse Gas Emissions”bill was presented to the congress,aiming to support clean hydrogen projects.Additionally,the Energy Secretariat plans to develop a certification framework for clean hydrogen.CostArgentina is launching pilot-scale projects to assess hydrogen production costs,aiming to clarify expenses and remove barriers.The“Promotion of Low Carbon Hydrogen and Other Greenhouse Gas Emissions”bill proposes tax breaks,access to foreign currencies and allocation of revenue for international funding.The strategy includes seeking strategic partners for pilot plants and participating in bids for supply contracts.Additionally,the voluntary green bond market provides an opportunity for hydrogen sector companies and small investors to support environmentally focused projects.Technology and talentArgentina is prioritizing the advancement of critical technologies like electrolysis and CCUS for clean hydrogen production through technology transfer and innovation.Efforts include promoting research,establishing dedicated research centres and fostering technological start-ups.These initiatives are expected to create 13,000 jobs by 2030 and 82,000 by 2050,with a focus on technical and professional training in hydrogen-related topics through collaboration between government sectors and universities.DemandArgentina plans to stimulate demand for synthetic fuels such as methanol,sustainable aviation fuel(SAF)and hydrotreated vegetable oil(HVO a renewable diesel fuel),relying on clean hydrogen,particularly to decarbonize maritime and aeronautical transport.Additionally,the country aims to facilitate hydrogen demonstration projects by implementing controlled regulatory environments known as“sandboxes”.InfrastructureArgentina is progressing in its clean hydrogen sector,with nine ongoing projects and seven in the pipeline.By 2030,Argentina aims to transition several projects from concept to operational stages.Private initiatives,leveraging renewable resources for electrolysis,are driving this development,supported by collaborations with international institutes and investments in renewable energy sources.Pace of developmentArgentina aims to master alkaline electrolysis technology by 2030,facilitating knowledge transfer and serial production.Pilot projects are underway to gauge hydrogen production costs and enable clearer understanding,while controlled regulatory environments are being established to make hydrogen demonstration projects feasible.Source:Argentina Presidency.43Accelerating the Clean Hydrogen Economy in LatinAmerica38ArgentinaCOUNTRY PROFILEPublic policies,partnerships and funding overview45PoliciesNational Strategy for the Development of the Hydrogen Economy Overarching strategic vision Policy framework LegislationNational Strategy for the Development of the Hydrogen Economy-Action PlansBill:Promotion of Low Carbon Hydrogen and Other Greenhouse Gas Emission promotes clean hydrogen production projectsLaw 26123 of 2006:Regime for the development of technology,production,use and applications of hydrogen as fuel and energy vectorLaw 27191 of 2015:National Promotion Regime for the Use of Renewable Energy Sources to Produce Electric Energy(modification)Law 27566 of 2020:Escaz AgreementLaw 25675 of 2002:General Environmental Law sets minimum budgets for achievement of sustainable developmentStrategic Environmental Assessment$480 million World Bank guarantee to boost private investment in Argentinas renewable energy sector48Creation of Renewable Energy Law(27.191)to finance clean-source energy projects46H2ar Consortium50 offers a collaborative workspace for companies interested in participating in the hydrogen value chain MoU between European Union and Argentina to advance cooperation and achieve objectives in clean energy,mainly in areas of hydrogen51Projects between Argentina and Germany in the field of energy transition/green energy,to stimulate sustainable relations52$350 million Inter-American Development Bank loan to drive sustainable and resilient growth in Argentina49RenovAR an auction-based renewable energy programme designed to scale-up private renewable generation capacity47Partnerships and funding Financial instruments PartnershipsAccelerating the Clean Hydrogen Economy in LatinAmerica39BrazilCOUNTRY PROFILEGas pipelinesPortsFacts and figures Current advancement in enabling measuresPopulation 216.4 millionGDP$1.92 trillion(2022)GDP per capita$9,455 CO2e emissions53 1,310.5 Mt(2022)Installed renewable capacity 175.3 GWNatural gas production 48.8 billion m(2021)Ammonia imports(value)$259 million(2021)Current infrastructure54,55TodayLCOH/kg:Renewable/Green:$2.87-$3.56(2023)56Current H2 demand/yr:0.4 Mt(2019)57 currently limited to oil refining and ammonia production,potential expansion to steel and fertilizers for decarbonization2030LCOH/kg:Renewable/Green:$1.9058 Domestic H2 production/yr:Potential for 0.6-1.1 Mt59 60%of total renewable/green H2 supply is expected to be consumed domestically602050LCOH/kg:Renewable/Green:$1.2061 Domestic H2 production/yr:Potential for 21-32 Mt62 Brazil will compete in clean hydrogen,accounting for 10%of the global market exports of 4 Mt produced via electrolysis Standards and certificationsBrazil is one of the leading countries in the region,working to establish a strong regulatory framework for green/renewable hydrogen,spearheaded by organizations such as the Brazilian Green Hydrogen Industry Association(ABIHV)63.Furthermore,the Electric Energy Commercialization Chamber(CCEE)is developing a renewable energy certificate for clean hydrogen,which can be blended into natural gas to help lower the industrys carbon footprint.64 CostThe country has several public policies and financial mechanisms to increase the competitiveness of clean hydrogen,including tax relief,special financing conditions,green finance and dedicated funds for renewables.Furthermore,Brazil has leveraged international funding and partnerships to overcome high costs,including a 2 billion investment from the EU as part of the Global Gateway initiative,BRL 21 million from a Brazil-Germany agreement for renewable/green hydrogen projects and a World Bank collaboration for solar power and renewable/green hydrogen development in north-eastern states.65 Technology and talentThe Brazilian government has committed to investing approximately BRL 200 million per year by 2025 into clean hydrogen R&D,including the creation of clean hydrogen pilot plants in all regions of the country by 2025 and the establishment of clean hydrogen hubs in Brazil by 2035.66 The Brazilian Ministry of Mines and Energy(MME),in collaboration with the National Service for Industrial Training(SENAI)and Germanys international development agency GIZ,has signed a cooperation agreement for the creation of the first Green Hydrogen Centre of Excellence in Natal(RN),together with five regional educational and training centres in the field of renewable/green hydrogen(known in Brazil as“H2V”).67 Partnerships with academia and research centres would help overcome technological challenges around clean hydrogen.DemandThrough the National Hydrogen Program,Law No.21767 of 2023 State of Paran68 and the Brazilian Pact For Renewable Hydrogen,69 Brazil is working to promote clean hydrogen applications such as a clean energy source or for use in the production of agricultural fertilizers.InfrastructureBrazil is advancing in its clean hydrogen economy with two operational hydrogen projects utilizing renewable sources,while it has an additional 20 projects in various stages of development.Brazil has not set explicit investment goals for 2030,but the scale of ongoing projects indicates substantial private sector investment,complemented by public sector support where needed.The country has strong commitments towards energy transition that could work as enablers for the evolution of clean hydrogen.Accelerating the Clean Hydrogen Economy in LatinAmerica40BrazilCOUNTRY PROFILE Pace of developmentBrazils National Energy Plan 2050 provides a long-term framework for the energy transition.The Brazilian Pact for Renewable Hydrogen sets ambitious goals but lacks specific timelines or quantifiable targets.70,71 Nevertheless,Bill No.725 of 2022 aims to expedite energy sector development through regulatory clarification,complemented by Decree No.21200 which establishes a strategic plan,as well as Decree No.5416 which proposes public policies.There is an opportunity for creating a smart regulation sandbox which enables technological routes,establishes and incentives the demand side and fosters competition to benefit the consumer.Public policies,partnerships and funding overview Policies72Bill No.725 of 2022:Addition of hydrogen as an energy sourceDecree No.21200 of 2022:State of BahiaVale and Petrobras protocol of intentions to increase clean hydrogen demand for green steel production,refining and other clean solutions 82Law No.21767 of 2023:State of GoisGreen Energy Park and State of Piau letter of intent creation of a 5 GW green ammonia production and export facility83Decree No.5416-R of 2023:State of Esprito SantoMME-GIZ-SENAI cooperation agreement creation of the First Centre of Excellence on Renewable/Green Hydrogen84Law No.21767 2023:State of ParanENGIE and ABH2 partnership to accelerate business in the renewable/green hydrogen segment85Law No.21454 of 2023:State of ParabaBrazil-Netherlands maritime corridor to facilitate renewable/green hydrogen exports86Bill No.3173 of 2023:Foster the production,distribution and use of renewable/green hydrogen generatedNational Energy Plan 205073Brazilian Pact for Renewable Hydrogen76National Hydrogen Program(PNH2)74 Development of a renewable energy certificate for renewable/green hydrogen77 Overarching strategic vision Policy framework75 Legislation2 billion investment from European Union to support renewable/green hydrogen production79BRL 21 million from Germany and World Bank for renewable/green hydrogen projects80$100 million from World Bank for Pecm Port as renewable/green hydrogen hub with Ministry of Development and Foreign Trade81Partnerships and funding Financial instruments78 PartnershipsAccelerating the Clean Hydrogen Economy in LatinAmerica41ChileCOUNTRY PROFILEGas pipelinesPortsFuture hubs Current infrastructure88Facts and figuresCurrent advancement in enabling measuresPopulation 19.6 millionGDP$301.3 billion(2022)GDP per capita$13,355 CO2e emissions87 137 Mt(2022)Installed renewable capacity 17.9 GWNatural gas production 1.29 billion m(2021)Ammonia imports(volume)0.35 Mt(2021)TodayLCOH/kg:Renewable/Green:$4.50-$5.00 Current H2 demand:focused on refineries,domestic ammonia,transportation(mining,heavy-duty trucks,long-distance buses),gas pipes2030LCOH/kg:Renewable/Green:$1.70-$2.60 depending on the regionDomestic H2 production/yr:Expected 200,000 tonnes of renewable/green H2 expected market size$5 billion/yr($2 billion domestic demand,$3 billion exports)2050LCOH/kg:Renewable/Green:$0.80-$1.10 the cheapest in the world Domestic H2 production/yr:Potential for up to 160 Mt of renewable/green H2 domestic market for renewable/green H2 worth$33 billionSource:Ministry of Energy Chile89 Standards and certificationsThe Chilean government has outlined a regulatory roadmap for the renewable/green hydrogen industry,with clear deadlines for three phases.90 Regulations for technical aspects of renewable/green hydrogen plants are already in place,while those for environmental compliance and security are under study.Additionally,Law No.21445 provides a framework for climate change,allowing compliance with emission standards through the acquisition of certificates verifying emission reduction or absorption.CostChile aims to produce the worlds cheapest renewable/green hydrogen by 2050.91 The country has established a regulatory framework to drive down production costs.92 It is now accelerating the development of renewable/green hydrogen projects,with significant international support including:a$150 million loan from the World Bank,93 a$50 million commitment from Chiles economic development agency(CORFO),a 225 million renewable/green hydrogen fund from the European Commission94 and a$400 million loan from the Inter-American Development Bank.95 Technology and talentChile has expedited three pilot initiatives for renewable/green hydrogen technology in production,mining and transport,while Germany is investing in technology to accelerate renewable/green hydrogen production in Chile.The renewable energy industrys expansion in Chile could create 11,000 new jobs.96 CORFO provided a free online course in 2021 sponsored by the EU to enhance knowledge of the renewable/green hydrogen industry.DemandChile is advancing toward ratifying a trade agreement with the EU,focusing on renewable/green hydrogen,which will facilitate free renewable/green hydrogen trade across borders,boosting demand for Chilean renewable/green hydrogen.97 Early adoption of renewable/green hydrogen is anticipated in the energy and transportation sectors,particularly for heavy-duty vehicles.98 Chile projects a market size for renewable/green hydrogen of$5 billion by 2030.99 Additionally,Santiagos airport aims to incorporate renewable/green hydrogen into its operations to achieve carbon neutrality by 2050,positioning itself as a regional leader in sustainable aviation.100 InfrastructureChile is making significant strides in its renewable/green hydrogen economy,with 64 projects at various stages of development.Four operational projects utilize technologies like polymer electrolyte membrane(PEM)electrolysis powered by renewable sources.Future projects slated for completion by 2030 range from feasibility studies to large-scale production facilities,showcasing Chiles holistic approach to renewable/green hydrogen integration.The emphasis on dedicated renewables underscores Chiles commitment to sustainable energy solutions.101Accelerating the Clean Hydrogen Economy in LatinAmerica42National Green Hydrogen Strategy 2050104Decree-Law 2224 of 1978(modified in 2021)to directly regulate the renewable/green hydrogen industryLaw No.20698 of 2013Development of renewable/green hydrogen regulationsPublic policies,partnerships and funding overviewPoliciesENAP*joint-development agreement to transform the Gregorio Maritime Terminal into the largest industrial complex in the Magallanes region112 BMWK*-Siemens Energy developing the worlds first integrated commercial installation to produce climate-neutral fuel near Punta Arenas in south Chile113 225 million renewable/green hydrogen fund by Team Europe Renewable in Chile for financing renewable/green hydrogen projects108$50 million from public funds CORFOs commitment to finance the development of six pilot projects110$150 million loan from World Bank to promote investment in renewable/green hydrogen projects109$400 million loan from Inter-American Development Bank to finance new projects in renewable/green hydrogen111Green Hydrogen Action Plan 2023-2030105Technical Assessment Criteria in the SEIA*:integrated description of projects for the generation of green hydrogen Law No.21210 of 2020SAF Roadmap 2050106Bulletin No.391-369 of 2021Law No.21455 of 2021Partnerships and fundingChileCOUNTRY PROFILE Financial instruments Partnerships Overarching strategic vision Policy framework Legislation107Note:*SEIA is the Chile governments environmental impact evaluation system.Notes:*ENAP is Chiles national petroleum company,*BMWK is the German Federal Ministry for Economic Affairs and Climate Action.Pace of developmentChiles new government in 2022 reaffirmed the ambitious programme for renewable/green hydrogen set by the previous government in the National Green Hydrogen Strategy in 2020.102 Chile expects to have 5 GW of electrolysis capacity either operating or under development by 2025 and 25 GW by 2030.103Accelerating the Clean Hydrogen Economy in LatinAmerica43Gas pipelinesPortsFuture hubsFacts and figuresCurrent advancement in enabling measuresColombiaCOUNTRY PROFILEPopulation 52.5 millionGDP$343.9 billion(2022)GDP per capita$6,630(2022)CO2e emissions114 215.5 Mt(2022)Installed renewable capacity 13.4 GW(2023)Natural gas production 12.4 billion m(2022)Ammonia imports(value)$30.4 million(2021)Current infrastructureTodayLCOH/kg:SMR CCS/Blue:$2.40(2020)Renewable/Green:$2.10-$4.80(2020)Current H2 demand:150,000 tonnes of conventional/grey H2 focused on refineries,chemical industry,steelmaking and other industrial uses2030LCOH/kg:SMR CCS/Blue:$2.40 Renewable/Green:$1.70-$2.70Domestic H2 production/yr:Goal to develop 1-3 GW of electrolysis capacity and produce at least 50,000 tonnes of SMR CCS/blue H2 clean H2 demand expected to reach 120,000 tonnes(including partial replacement of grey H2 and new uses)2050LCOH/kg:SMR CCS/Blue:$2.40-$2.50 Renewable/Green:$1.10-$1.70 4th cheapest in world Domestic H2 demand:Estimated at 1.85 Mt for clean H2 transport sector 64%industrial sector 34%electricity sector 2%Source:Ministry of Mines and Energy Colombia118115,116,117 Standards and certificationsPhase 1 of the countrys clean hydrogen roadmap focuses on designing guarantees and certifications for renewable/green hydrogen production.This involves collaboration with international task forces to adopt best practices and develop a national certification system.Colombia plans to design a guarantee of origin(GO)system to determine certification mechanisms,actors involved,governance framework and validation processes at local and international levels.119 Recommendations for implementing a clean hydrogen certification system were provided by energy transition consultancy HINICIO Colombia to the Ministry of Mines and Energy.120 CostThe Colombian government has implemented Law 2099 to incentivize investment in clean hydrogen production and provide benefits.The Mining and Energy Planning Unit(UPME)certifies projects for access to these incentives.Additionally,government investment through the Non-Conventional Energy and Efficient Energy Management Fund(FENOGE)now includes financing for viable projects in the clean hydrogen value chain,prioritizing those that reduce emissions and create wealth and jobs.121 Technology and talentColombia supports clean hydrogen projects through various funds which aim to promote regional competitiveness and finance science and technology initiatives.The national clean hydrogen action plan includes initiatives such as promoting clean hydrogen workgroups in universities and business associations as well as potentially establishing a national hydrogen centre for pilot projects.122 DemandThe incentives provided by Law 2099 for clean hydrogen production also extend to end uses,stimulating demand by reducing costs.Additionally,Law 1964 of 2019 acknowledges clean hydrogen technologies in the mobility sector,offering incentives for electric vehicles(EVs).123 Law 1931 of 2018 recognizes the role of the Non-Conventional Energy Sources Law in mitigating GHG emissions,prompting local governments to include provisions for promoting renewable energy and energy efficiency in their development plans.124 The National Hydrogen Roadmap aims to attract$2.5-$5.5 billion in investment for clean hydrogen production and demand projects between 2020 and 2030.125 InfrastructureColombia is actively expanding its clean hydrogen economy,with six potential hubs operational in different regions by 2050,28 projects at various stages of development and three operational projects with renewable energy sources already in place.Additional projects are slated for completion in the coming years,with some reaching the FID stage or construction stage between 2023 and 2025,while some will be in the feasibility study phase with target dates extending to 2033.Accelerating the Clean Hydrogen Economy in LatinAmerica44Public policies,partnerships and funding overview$1 billion loan from World Bank to support a programme of reforms aimed at contributing to Colombias clean hydrogen development135$750 million low-interest loan from World Bank to support efforts towards long-term sustainable growth by promoting key institutional reforms139UK investment to develop renewable/green hydrogen and ammonia production projects up to 5 GW137FENOGE national fund to finance and execute plans and projects to improve energy efficiency136 Ecopetrol and Colombian government the government has backed plans for investment in renewable energy and clean hydrogen projects140Climate partnership with 200 million pledge from Germany to help Colombia reach its climate targets142MoU with Fraunhofer Gesellschaft to analyse the production of hydrogen,ammonia,methanol and green fertilizers143Dialogues with South Korea exploring the potential for renewable/green hydrogen exports144European Union investment financing hydrogen projects in Colombia138MoU with Medelln Public Companies(EPM)and Japan Bank for International Cooperation to promote the exploration of new opportunities in renewable energy and clean hydrogen projects141Partnerships and funding Financial instruments PartnershipsColombiaCOUNTRY PROFILEPoliciesNational Hydrogen Roadmap129Certification system recommendations130Law 1715 of 2014 promotes the development and use of renewable energy sources and their storage systems131Law 2069 of 2020 supports entrepreneurial growth and social equity133Decree 2235 of 2023 modifies Article 235 of Law 2294 of 2023 in relation to the development of natural/white hydrogen*projects134Law 2099 of 2021 encourages the use of renewable/green and SMR CCS/blue hydrogen132 Overarching strategic vision Policy framework Legislation Pace of developmentLaw 2099 of 2021 grants the national government the authority to establish mechanisms to promote clean hydrogen innovation,research,production,storage,distribution and utilization.126 Additionally,Law 2069 of 2020 establishes a regulatory sandbox for innovative business models in regulated industries.127 Colombias national action plan includes creating a centralized registry of clean hydrogen projects and companies to identify interests,project types,synergies and best practices within the clean hydrogen value chain.128Note:*natural/white hydrogen:formed by natural processes.Accelerating the Clean Hydrogen Economy in LatinAmerica45MexicoCOUNTRY PROFILEGas pipelinesPortsCurrent infrastructureFacts and figuresCurrent advancement in enabling measuresPopulation 129.4 millionGDP$1.46 trillion(2022)GDP per capita$10,077CO2e emissions145 819.9 Mt(2022)Installed renewable capacity 31.7 GWNatural gas production 31 billion m(2022)Ammonia imports(value)$340 million(2021)TodayLCOH/kg:Renewable/Green:$4.00148 Current H2 demand/yr:51,000 tonnes of H2 by 2025149 demand is driven by refining and petrochemical activity1502030LCOH/kg:Renewable/Green:$2.75 Estimated onsite production cost Domestic H2 demand&production/yr:230,000 tonnes of renewable/green H21512050LCOH/kg:Renewable/Green:$1.25 Estimated onsite production cost Domestic H2 d
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