Costs pressures are biting
Green hydrogen costs surge up to 65% in a year
Higher electrolyser and finance costs among factors inflating LCOH but green hydrogen seen holding market share compared to blue, says McKinsey and Hydrogen Council
The levelised cost of renewable hydrogen (LCOH) has surged by 30–65% in the last 12 months on the back of higher electrolyser capex, and financing and renewable power costs, according to joint analysis by consultants McKinsey and industry group Hydrogen Council. Costs have also risen because of the broader inclusion of additional costs such as EPC compared to estimates made a year ago, they said in the 2023 edition of their Global Hydrogen Flows report. The US is the lowest cost producer of both renewable and gas-based low-carbon hydrogen in 2030, with renewable achieving a unit production cost of well below $1/kg and low-carbon just above $1/kg. The cost projections are based on the report’
Also in this section
25 February 2026
Low-carbon hydrogen and ammonia development is advancing much more slowly and unevenly than once expected, with high costs and policy uncertainty thinning investment. Meanwhile, surging energy demand is reinforcing the role of natural gas and LNG as the backbone of the global energy system, panellists at LNG2026 said
18 February 2026
Norwegian energy company has dropped a major hydrogen project and paused its CCS expansion plans as demand fails to materialise
4 February 2026
Europe’s largest electrolyser manufacturers are losing patience with policymakers as sluggish growth in the green hydrogen sector undermines their decision to expand production capacity
2 February 2026
As a fertiliser feedstock, it is indispensable, but ammonia’s potential as a carbon-free energy carrier is also making it central to global decarbonisation strategies
