Expert View: Unpacking the Challenges of Green Hydrogen Offtake Agreements

[caption id="attachment_38331" align="alignleft" width="342"] Man holding earth globe [/caption] Regulatory frameworks One of the fundamental challenges facing green hydrogen projects is the lack of clear and consistent regulatory frameworks. There is a growing sense of uncertainty regarding climate action and potential regulations that governments may impose. This uncertainty has a direct impact on the green hydrogen market, as potential offtakers may choose to wait and see what regulatory penalties will be imposed before committing to decarbonisation projects. Overcoming this initial hesitation will require governments and industries to create a stable and predictable market environment that incentivises action. Governments need to set clear and stringent mandates for emissions reductions, supported by penalties for non-compliance to help propel projects in the future fuels sector. Without such regulations (and penalties) in place, many industries may opt to delay green transition, prioritising short-term gains over long-term sustainability. Amongst the sector Offtake agreements are about more than just price. Offtakers need to consider factors like security of supply,...