Investments exceeding $1 T needed for hydrogen infrastructure

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Emmanouil Kakaras, Executive Vice President at Mitsubishi Heavy Industries, emphasized the necessity for substantial investments in infrastructure to facilitate the widespread adoption of hydrogen fuel in Europe and the United States. Speaking at the CERAWeek by S&P Global energy conference, Kakaras highlighted that transitioning to hydrogen requires significant new demand, which can only be achieved through infrastructure investments aimed at reducing costs.

"European and US governments must make this investment to bridge the gap, totaling over $1 trillion," Kakaras stated during an interview at the conference. With European governments committing $750 B and the US considering funding for hydrogen projects under the Inflation Reduction Act, Kakaras believes it could facilitate the transition to cleaner fuels from fossil fuels.

According to Kakaras, the development of new hydrogen infrastructure in Europe could lead to broader adoption by 2035. Moreover, if combined with carbon capture and storage initiatives in the US to mitigate greenhouse gas emissions, the energy transition could be effectively realized.

However, Amin Nasser, CEO of Aramco, offered a contrasting perspective at the same conference, suggesting that the focus should remain on reducing carbon emissions from oil and gas rather than shifting to alternative energy sources and technologies. Nasser expressed skepticism about the current transition strategy, noting that hydrogen still costs between $200 to $400 per barrel of oil equivalent, whereas oil and gas remain more cost-effective.

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