Global Scale-Up with Structural Barriers: An International Perspective on Hydrogen Strategies

Hydrogen is considered a key building block of the energy transition and is positioned in policy strategies worldwide as a core technology for the decarbonization of industry, transport, and energy systems. Since the publication of numerous national hydrogen strategies starting in 2020, a dynamic yet heterogeneous global landscape has emerged. While ambitious expansion targets and multi-billion funding programs suggest an accelerated market ramp-up, a closer look reveals a more nuanced picture.

The current situation is characterized by a gap between strategic ambition and actual implementation speed. Although global demand for hydrogen has continued to grow, it remains heavily concentrated in established applications, such as the ammonia and refining industries. New fields of application are developing more slowly than often anticipated. At the same time, key prerequisites for a broad market ramp-up—particularly infrastructure, production capacities, and regulatory frameworks—are still in the early stages of development.

Against this backdrop, a structured look at international hydrogen strategies, their differing priorities, and their shared challenges is worthwhile.

Analysis of global demand trends shows that hydrogen is still predominantly used in traditional industrial processes. These include, in particular, the production of ammonia and methanol, as well as applications in refining. These sectors continue to form the backbone of the hydrogen market.

New application areas are emerging primarily where electrification is technically or economically limited. These include:

• High-temperature industrial processes (e.g., sintering, melting, and combustion processes)
• Chemical processes with specific reaction requirements
• Long-term energy storage to complement fluctuating renewable energy sources
• Applications in mobility and logistics, particularly in heavy-duty transport

The so-called “hydrogen ladder” illustrates that hydrogen is most effectively used where alternative decarbonization options are lacking or reach their limits. In many areas, however, its use remains prospective and highly dependent on technological progress and cost developments.

Notably, some countries—Japan in particular—are actively attempting to accelerate this demand development. Through targeted support mechanisms, price targets, and cross-sector applications, they are not only responding to existing demand but actively creating a future market. This represents a key difference from more supply-driven strategies.

A look at key players shows that different strategic approaches have emerged worldwide. These differ particularly in terms of technological openness, export orientation, demand policy, and regulatory design.

North America: Scaling and Technological Diversity

In the United States and Canada, there is a strong focus on large-scale projects and a broad technological base. Many projects are currently in the concept or feasibility phase and are characterized by substantial production capacities.

A defining feature of the North American strategy is openness to various production methods. In addition to electrolysis, hydrogen production from natural gas combined with carbon capture and storage (CCUS) plays a significant role. This technological diversity enables rapid scaling but also raises questions regarding long-term climate goals and sustainability criteria.

Australia: Potential and Project Delays

Australia has excellent natural conditions for renewable energy generation and is often seen as a future exporter of green hydrogen. Large land areas and high solar and wind potential provide a favorable starting point.

In practice, however, many projects are falling behind their original schedules. Reasons include rising investment costs, financing challenges, and uncertainties regarding future markets. As a result, there is currently a stronger focus on local applications and demonstration projects.

In the long term, the export perspective remains, but it depends on the development of international trade structures and off-take agreements.

Europe and Germany: Focus on Regulation and Infrastructure

Compared internationally, Europe is pursuing a more regulation-driven approach. The aim is to enable a coordinated market ramp-up that meets both climate policy requirements and industrial policy interests.

Germany plays a central role in this context. Its national hydrogen strategy defines ambitious targets up to 2030, including:

• Accelerating the market ramp-up of hydrogen technologies
• Building a high-performance infrastructure
• Ensuring sufficient availability of hydrogen and its derivatives
• Establishing applications across various sectors

A key element is the development of a hydrogen core network, intended to serve as the backbone for transport and distribution. Initial sections are already in operation, with further parts planned or under construction.

Unlike other regions, the focus is less on short-term scaling and more on creating stable framework conditions and long-term integration into existing energy systems.

Japan: Demand-Oriented Import Strategy and System Integration

Japan occupies a unique position internationally and follows a strongly systemic approach. Hydrogen was positioned early on as a strategic energy carrier, with long-term visions extending to 2050 and concrete interim targets for cost reduction and market development.

At the core of Japan’s strategy is the assumption that a functioning hydrogen market can only emerge through the simultaneous interaction of supply, demand, and infrastructure. Accordingly, measures are not considered in isolation but developed along the entire value chain.

A key feature is the consistent focus on cost reduction. Through scaling effects, technological innovation, and state-supported market mechanisms, hydrogen costs are to be reduced to levels comparable with conventional energy carriers. Support instruments also play a role in mitigating price risks between production and application.

At the same time, due to limited domestic resources, Japan is heavily dependent on imports. This results in a clear focus on building international supply chains and transport technologies. These include liquefied hydrogen, ammonia, and organic carriers that enable global distribution.

On the demand side, Japan is also pursuing a broad approach. Applications range from power generation and industrial processes to mobility. Demonstration projects—such as hydrogen and ammonia co-firing in power plants or hydrogen-based steel production—aim to prove technical feasibility under real conditions and prepare the market ramp-up.

Another key pillar is close cooperation between government, industry, and the financial sector. Institutions such as cross-industry alliances help bundle investments, address regulatory barriers, and establish international partnerships.

At the same time, Japan’s strategy is not without uncertainties. Strong import dependency, high investment costs, and reliance on global market structures represent key risks that could influence further development.

Regardless of regional differences, a common pattern emerges worldwide: the expansion of infrastructure and production capacities represents the main bottleneck for hydrogen scale-up.

Electrolysis Capacities
Installed and planned electrolysis capacities are growing but still fall significantly short of long-term targets. The development of large-scale facilities requires substantial investment and depends heavily on policy support mechanisms and energy price developments.

Transport and Storage
The development of suitable transport infrastructure—such as pipelines, storage solutions, and import terminals—is essential for supply security. While Europe focuses strongly on pipeline networks, countries like Japan are developing maritime transport solutions and alternative carriers to enable global supply chains.

Import Dependency
Many industrialized countries will depend on hydrogen imports in the long term. This requires the development of international supply chains and appropriate trade mechanisms. At the same time, new geopolitical dependencies are emerging that must be considered in strategic planning.

In addition to technological and infrastructural challenges, the regulatory dimension is becoming increasingly important. Standardization, in particular, presents a complex and partly fragmented picture.

Existing Frameworks and Their Limits
Hydrogen has been used industrially for over a century, meaning that basic regulations and safety standards exist. However, these primarily relate to specific industrial applications and are not designed as a comprehensive, unified framework for a hydrogen economy.

A key example is the European regulatory framework for explosion protection, particularly the ATEX directives. These define requirements for products and operations in explosive atmospheres but mainly refer to atmospheric conditions. New applications, such as high-pressure or cryogenic systems, are currently insufficiently covered.

Gaps in Standards and Technological Dynamics
The introduction of new technologies creates additional challenges for standardization. Examples include:

• High-temperature electrolysis (SOE)
• Applications involving cryogenic hydrogen
• Complex hydrogen-oxygen systems
• Large-scale facilities with specific safety requirements

In many of these areas, harmonized international standards are still lacking. This leads to differing national regulations, complicates scaling, and hinders international trade. For globally oriented strategies—such as Japan’s—this fragmentation becomes a particularly critical factor.

Impact on Market Ramp-Up
The lack of harmonization has direct consequences for market development. Different requirements for components and systems lead to a wide variety of product variants, increase complexity, and may delay investment decisions.

In addition, uncertainties arise regarding approval procedures and operational regulations, which can create additional risks, especially for innovative projects.

Numerous international initiatives have already been launched to close existing gaps. Standardization bodies are working on developing new standards tailored to hydrogen technologies.

Nevertheless, significant action is still required, including in the following areas:

• Defining requirements for non-atmospheric conditions
• Harmonizing tightness and leakage requirements
• Updating regulations for cryogenic applications
• Developing safety concepts for new technologies
• Clarifying qualification requirements for skilled personnel

At the same time, further research is needed, particularly in safety-related areas such as ignition mechanisms, material behavior, and protective design measures.

The analysis of international hydrogen strategies shows that the global ramp-up is determined less by technological feasibility and more by structural framework conditions. Four key challenges can be identified:

1. Scaling production and infrastructure
   Building sufficient production capacity and appropriate transport and storage systems is a prerequisite for widespread hydrogen use. This requires significant investment and long-term planning certainty.
2. Developing international supply chains
   The future hydrogen economy will be strongly shaped by global trade structures. Building stable supply chains and securing imports are central tasks, particularly for energy-import-dependent regions.
3. Activating demand and market ramp-up
   In addition to expanding supply, developing robust demand is becoming increasingly important. Strategies like Japan’s show that targeted market-creation measures can be crucial for enabling scaling effects and cost reductions.
4. Harmonizing standards and regulation
   Uniform international standards are essential for scaling technologies and integrating markets. The current fragmentation represents a major barrier and requires coordinated international efforts.

Overall, hydrogen remains a central pillar of the energy transition. However, its potential depends heavily on successfully addressing these structural challenges. The international comparison shows that different strategic approaches are being pursued, each with specific strengths and weaknesses.

A successful transformation will therefore not be defined by a single model, but by the ability to integrate different approaches—ranging from scale-driven production strategies and regulation-based system integration to demand-oriented and import-based models—into a functioning global system.