What is Green Hydrogen:
Hydrogen fuel is produced by electrolyzing water using renewable electricity, such as solar, wind, and hydro power, and is called Green Hydrogen. A unit called an electrolyser is used where this reaction takes place. It is the cleanest form of hydrogen production because it results in zero greenhouse gas emissions. This is because this process splits water into hydrogen and oxygen, and the energy that is used to power this separation comes from clean sources. The principal purpose of this method is to limit global warming and to limit fossil fuel dependence. Basic applications of this type of energy are for shipping, in heavy industry, and in long-term energy storage.
Benefits of Green Hydrogen:
Currently, the world is adopting green hydrogen for energy, as this technique used to obtain green hydrogen helps rapidly reduce the amount of CO2 emissions. Listed below are some of the benefits and uses of green hydrogen.
- Environmental Benefits: The most vital benefit of green hydrogen is its sustainability because it doesn’t cause pollution. Neither the process of its production nor its usage releases harmful gases. By eliminating greenhouse gas emissions, this fuel energy majorly helps to reduce carbon footprints.
- Storage and Versatility: Green hydrogen is remarkably versatile. It can be easily converted into a form of electricity or synthetic energy. Apart from that, hydrogen is very light, which makes it easy to store.
- Energy Efficiency: A high-density energy source is produced by using technology in hydrogen fuel cells, which is highly energy efficient.
Venture Capital (VC) and government investments:
The governments, along with venture capital (VC), are boosting the concept of green hydrogen by de-risking different parts of the supply chain and markets. With the surge in the funding of solar and wind energy in the last few decades, green hydrogen is going to get major scale-ups.
Government support:
Governments all over the world have been working in support of green hydrogen. By establishing policies that support green energies, to launching major initiatives that accelerate the green hydrogen market. These initiatives include financial funding and national strategies. For example, many countries are implementing measures such as tax reductions and low-interest loans. Apart from that, the governments make national strategies to become green hydrogen leaders. Governments are also working on funding pilot programs that work on critical infrastructure to build hydrogen ecosystems.
Venture capital investment:
VC funding complements government efforts by investing in the innovative technologies that are needed to make green hydrogen activities more competitive. The majority of VC funding, over 95% is directed towards hardware-based startups that focus on tangible assets like electrolyzers and storage. Corporate VC arms, particularly from energy and industrial companies, are the key players. They not only bring capital but also the critical industry expertise and connections to support early-stage ventures.
Synergies between VC and government efforts:
Governments play a very crucial role by offering grants and financial incentives that reduce the initial risk of these large, capital-intensive projects. Significant challenges and the high costs involved in expanding green hydrogen technology are being effectively managed through a partnership between governments and VC firms. These kinds of partnerships and collaborations make projects more appealing and pave the way for private VC investments. Governmental efforts concentrate on creating the essential infrastructure and establishing a market for the product through policies and purchasing requirements. This combined public-private approach is the key to speeding up the adoption of green hydrogen.
Conclusion:
Green Hydrogen is emerging as a foundation of the global clean energy transition and the generation of renewable energy using electrolysis of water. It also guarantees zero greenhouse gas emissions, which helps reduce global warming. Its key appeal lies in its fundamental sustainability and high efficiency, which position it as a solution for enabling long-term energy storage. The momentum behind its adoption is a strong collaboration between the government and venture capital. Where governments mitigate initial risk through financial incentives and infrastructure policies, venture capital complements this by investing heavily in the hardware technologies.
References:
https://www.iberdrola.com/sustainability/green-hydrogen
https://www.sciencedirect.com/topics/engineering/green-hydrogen
