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Low-carbon hydrogen demand in refining could reach 50 Mtpa by 2050
Global refining sector could reach 50 million tonnes per annum (Mtpa) by 2050, says Wood Mackenzie
KEY INSIGHTS
- Oil refining is one of the largest markets for hydrogen, accounting for about 32 Mtpa or 30-35% of global hydrogen demand in 2020
- Hydrotreating and hydrocracking are the major refinery processes consuming over 90% of hydrogen in the refining sector
- more than 65% of hydrogen demand in refining is met by hydrogen supplied as a by-product from catalytic reformers and ethylene crackers;this is unlikely to be replaced by low-carbon hydrogen
- Low-carbon hydrogen has the potential to replace on-purpose hydrogen as a feedstock if low-carbon hydrogen becomes cost competitive and policy support develops over time
- Real game-changer is in replacing fossil fuels in combustion applications to generate heat and steam. This will provide a larger market for low-carbon hydrogen in refining with potential market size reaching up to 40 Mtpa by 2050, and up to 300 Mtpa or about 25% reduction in carbon emissions
BOTTOMLINE
From costs and emissions perspective, a leap towards green hydrogen rather than blue is more likely in refining in the longer term. However, countries with low-cost gas resources and CO2 sequestration capacity will have the opportunity to enter the blue hydrogen market.
Low-carbon hydrogen demand in refining could reach 50 Mtpa by 2050
Potential low-carbon (green or blue) hydrogen demand from the global refining sector could reach 50 million tonnes per annum (Mtpa) by 2050, says Wood Mackenzie.
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