2023 May Green Hydrogen Opportunities for the Gulf Region Sustainability Research Paper The Al-Attiyah Foundation 01 OUR MEMBERS The Al-Attiyah Foundation is proudly supported by: Research Series 2023 May INTRODUCTION Green hydrogen can help decarbonise hard-to-abate sectors like refinery, steel and heavy duty transport and the chemical industry. The Gulf region is well positioned to establish itself as a hydrogen hub as it has cheap and abundant renewable energy resources and is located in the vicinity of major hydrogen consumption centres like Europe and Asia. What risks does a massive uptake of green hydrogen pose to the region? What is green hydrogen and what is its current and future contribution to a sustainable global development? Which hydrogen policy frameworks are currently existing in the Gulf region? Research Series 02 SUSTAINABILITY RESEARCH PAPER This research paper is part of a 12-month series published by the AlAttiyah Foundation every year. Each in-depth research paper focuses on a current sustainability topic that is of interest to the Foundation’s members and partners. The 12 technical papers are distributed to members, partners, and universities, as well as made available on the Foundation’s website. 2023 May 03 EXECUTIVE SUMMARY • Green hydrogen can help decarbonise hard-to-abate sectors like refinery, steel and heavy duty transport and the chemical industry. • Today’s hydrogen demand is forecasted to grow five-fold until 2050 which opens significant economic opportunities for renewable energy rich regions like the Gulf countries. • The Gulf region is well positioned to establish itself as a hydrogen hub due to various reasons: o It has cheap and abundant renewable energy resources. o It is geographically well located in the vicinity of major hydrogen consumption centres like Europe and Asia. o It has the experience and infrastructure as well as the financial means to develop large-sale energy projects. Research Series o The domestic production of cheap, green hydrogen might attract energy intensive industries from other regions which can contribute to the diversification of a country’s economy. • More stringent global climate commitments might heavily reduce the region’s revenues resulting from fossil-fuel exports with related impacts to countries’ economies. • Regarding the different hydrogen production technologies, the Gulf countries have varying approaches. Oman focuses on producing green hydrogen, Qatar is opting for blue hydrogen, and the UAE and Saudi Arabia plan to strike a balance between both options. • A global uptake of hydrogen demand is a double-edged sword for the Gulf countries. It can be seen as a significant economic risk to the region due to declining demand for fossil fuels, but it also brings immense opportunities for sustainable economic diversification and positioning the region as a world leader for producing and exporting green hydrogen. 2023 May BACKGROUND Climate change is one of the most significant challenges of our time. The world is facing unprecedented changes in climate patterns, with potentially devastating effects on natural ecosystems, human livelihoods, and global economic growth. The urgency to reduce carbon emissions and transition towards sustainable energy sources has become a top priority for many countries and regions worldwide (UNFCCC 2023). In this context, green hydrogen has emerged as a promising solution for decarbonisation, especially in the hard to abate sectors like heavy industry and heavy-duty transport as well as aviation and maritime transport (IEA 2022). The Gulf Cooperation Council (GCC), consisting of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates (UAE), is one of the world’s largest and most established energy exporters, with about 1/3 of the world’s oil and 1/5 of the world`s natural gas reserves (SWP 2022). The emerging green hydrogen market presents significant opportunities, but also risks, for the Gulf region. On the one hand, the region has abundant renewable energy resources, including solar and wind power, that could be harnessed to produce green hydrogen – paving the way for large scale exports of green hydrogen and its derivatives. Moreover, its vicinity to major hydrogen consumption centres like Europe and Asia as well as its established energy transport infrastructure makes the region a perfect candidate to become a major hub for Power-to-X (PtX) export. However, th