Energy Transition

The partnership marks a significant step forward in the global expansion of green hydrogen technology. (Image source: Siemens)

Technology company Siemens, China-based Guofu Hydrogen and Germany-based RCT GH Hydrogen are collaborating to advance the hydrogen value chain

The partnership is set to accelerate the global expansion of green hydrogen technology as it focuses on the development and manufacture of electrolysers and green hydrogen production. A recent report from the IEA highlights the growing momentum for low-emissions hydrogen, but notes that while global electrolyser manufacture capacity has grown significantly, progress is stalling due to higher prices and tight supply chains. A continuation of cost reductions relies on technology development, as well as optimising deployment processes and moving to mass manufacturing to achieve economies of scale, the IEA says.

The new partnership focuses on three key areas: developing and engineering Guofu’s electrolysers and electrolyser systems, equipping new electrolyser manufacturing facilities starting in Germany, and developing, constructing, and operating new hydrogen production plants.

RCT GH Hydrogen will lead the engineering, procurement, and construction of state-of-the-art hydrogen production facilities, and ensure that the electrolyser manufacturing facilities meet the highest efficiency and safety standards.

Siemens will be the preferred supplier and technology partner across the entire value chain of Guofu Hydrogen's expansion plans. It will deliver products, solutions and services from across its Siemens Xcelerator portfolio, the company’s open digital business platform, including industrial automation and instrumentation, as well as electrification and building technology, industrial communication, and cybersecurity solutions. Siemens will also provide digital services and software for the design, engineering, simulation, optimisation and standardisation of the entire hydrogen value chain, from electrolyser manufacturing to the operation of hydrogen plants.

Global hydrogen partner ecosystem

The collaboration also involves the development of a global hydrogen partner ecosystem to bring together suppliers, technology providers, and end-users to accelerate innovation and standardisation across the industry, supported by the Siemens Xcelerator, which enables seamless integration and collaboration throughout the value chain.

"This strategic partnership exemplifies Siemens' commitment to driving the industrialisation of green hydrogen production," said Axel Lorenz, CEO of process automation at Siemens. "Our portfolio and domain expertise, combined with Guofu Hydrogen's vision and RCT GH Hydrogen’s proven engineering capabilities, will help establish new standards in electrolyser manufacturing efficiency and scalability. Together, we're not just building factories – we're building the foundation for a sustainable hydrogen ecosystem that will play a crucial role in the global energy transition.”

“Partnering with Siemens allows us to leverage world-class automation and digital capabilities,” added Pinfang Wu, board chairman of Guofu Hydrogen. “This collaboration will significantly accelerate our expansion into global markets and strengthen our position as a leading provider of green hydrogen solutions. Together, we're creating a blueprint for the future of hydrogen production.”

68% of methane emissions stem from upstream facilities. (Image source: Adobe Stock)

The energy sector presents the largest and most cost-effective opportunity for methane emissions reduction, with 68% of methane emissions stemming from upstream facilities, according to Momentick’s 2024 Methane Emissions Report

Momentick, a leading emissions intelligence company, which leverages the power of hyper and multispectral satellites to monitor GHG emissions on a planetary scale, detected emissions at 17% of the sites analysed, measuring a staggering 899 million tons of CO2-equivalent emissions, with 10% of assets accounting for 50% of the emissions detected. The highest concentration of methane leaks was detected in Asia, Africa, and North America, while Europe recorded the fewest leaks.

Methane is a colourless, odourless gas, which requires highly sensitive instruments for detection. Methane leaks can manifest as both diffuse, small emissions and large, concentrated bursts, complicating the consistent identification of leaks. Environmental factors, such as wind, temperature, and terrain, further hinder accurate detection and measurement, as methane plumes disperse quickly, making it difficult to trace emissions back to their sources.

Unlike CO2, methane emission reductions have an almost immediate effect on slowing global warming as methane has a relatively short atmospheric lifespan compared to CO2. By urgently tackling methane emissions, the rate of warming could be slowed by as much as 30% before mid-century, according to Momentick.

The International Energy Agency (IEA) estimates that over 75% of the methane emissions in the oil and gas sector could be reduced today using existing technologies, while research conducted by JP Morgan has found that methane abatement is a cost-effective investment, revealing that up to 70% of the expenses associated with monitoring solutions can be offset by keeping methane in the pipe.

Addressing the issue of poor emissions data

The Momentick report notes that evolving regulations and financial incentives have highlighted the critical need to address the longstanding issue of poor emissions data, with accurate and reliable information needed for decision-makers to implement effective methane abatement strategies. The growing need for accurate and actionable emissions data is driving the expansion of space-based methane monitoring satellites, while advanced algorithmic software solutions are leveraging Earth observation satellites to enhance commercial applications and precise point-source methane detection. By analysing historical data captured by these satellites, researchers and decision-makers can track emission trends over time, gaining deeper insights for regulatory planning and climate action. Additionally, with cutting-edge developments in AI, satellite-based emissions data can now be processed in near real-time, delivering timely and actionable insights.

“2024 was an important year on the path to curbing methane emissions,” said Daniel Kashmir, CEO of Momentick in his Foreword to the report. “Governments committed billions to technological upgrades and research, while oil and gas operators accelerated progress towards their net-zero goals. Collaborating with a wide variety of stakeholders across the energy sector, our team at Momentick encountered a strong commitment to action and eagerness to implement our emissions intelligence technology over the last year.

“We envision satellite-based emissions monitoring becoming central to corporate sustainability strategies during the energy transition. The integration of GHG monitoring and MRV practices will become a standard component of operations across industries. Backed by evolving regulations and growing adoption, these technologies will make net-zero goals truly achievable.”

The partnership aims to establish a supply chain of green hydrogen to Europe. (Image source: Adobe Stock)

Saudi-listed ACWA Power has signed a memorandum of understanding (MoU) with Snam relating to the establishment of a supply chain of green hydrogen to Europe

This partnership will involve exploring potential collaboration and joint investments aimed at establishing an international supply chain for a dependable and cost-effective supply of green hydrogen from Saudi Arabia to Europe and evaluating the development of an ammonia import terminal in Italy to facilitate the delivery of green hydrogen through the South H2 Corridor, a 3,300 km hydrogen pipeline connecting North Africa, Italy, Austria and Germany to supply competitive renewable hydrogen to European demand clusters.

Snam, a leading European operator in natural gas transportation, storage, and regasification, aims at building a pan-European multi-molecule infrastructure, advancing energy security and the transition to Net Zero. ACWA Power is a leading developer, investor, and operator of green hydrogen and green ammonia production facilities in the Kingdom of Saudi Arabia. As a partner in the NEOM Green Hydrogen Company (NGHC), ACWA Power is setting up a US$8.5bn mega plant at NEOM to produce green hydrogen at scale for global export in the form of green ammonia. This is set to be the world’s largest green hydrogen production facility, with a production capacity of up to 600 tonnes of carbon-free hydrogen daily by the end of 2026.

“We are excited to join forces with Snam to drive significant advancements in the green hydrogen sector. With power sector emissions already down 40% compared to 20 years ago, we now need to focus our collective efforts on new, low-carbon molecules to decarbonise our sectors. Bringing our expertise together will help accelerate this process,” said Marco Arcelli, chief executive officer of ACWA Power.

Stefano Venier, the chief executive officer of Snam, added, “The EU’s ambitious decarbonisation targets need decisive action across all manufacturing sectors, utilising all available technologies in a practical, efficient and accelerated manner. Hydrogen plays a key role here, and we are glad to pursue development opportunities in this field also through agreements like the one we signed with ACWA Power: the development of the ammonia import terminal is synergic with that of the South H2 Corridor.”

GCC energy players need to shift to product-level carbon accounting. (Image source: Adobe Stock)

As global regulations on reducing greenhouse gas emissions become increasingly stringent, energy companies face increasing pressure to address the carbon footprint of individual products, requiring a complete rethink of how emissions are measured, reported and mitigated

This presents both an opportunity and a challenge for GCC energy companies, as their relatively lower-carbon intense products offer a competitive edge to differentiate themselves in increasingly carbon-conscious global markets, according to a new report titled "Rethinking Corporate Decarbonization: From Enterprise Targets to Product Strategies," a collaboration between the World Future Energy Summit, and Strategy& Middle East, part of the PwC network.

Major energy players in the GCC are now required to report their overall carbon emissions - as part of national biennial carbon inventory submissions - under UNFCCC guidelines, and new carbon policies and regulatory frameworks are increasingly emphasising the carbon footprint of products, meaning energy companies must rethink their strategies to stay competitive. This shift reflects demand for transparency regarding the emissions associated with or embedded in individual products along their entire value chain, from extraction of raw materials, through processing, manufacturing, logistics and even end-of-life.

“This marks a pivotal moment for energy players. Setting broad corporate emissions targets is no longer sufficient. By adopting product-level decarbonisation, GCC energy companies can transform regulatory pressures into growth opportunities, securing their position as leaders in the global energy transition,” said James Thomas, partner at Strategy& Middle East.

The report presents a 3D framework which represents a real-time view of the latest global policies impacting sectors and products, enabling GCC energy companies to align carbon accounting and emissions mitigation efforts with regulatory demands and market expectations.

Carbon accounting as a source of competitive advantage

Shifting to product-level carbon accounting offers GCC energy players several strategic advantages, such as enabling tailored emissions reductions to meet market standards, improving compliance with global policies and enhancing product transparency to build customer trust and reputation. It also establishes flexibility for adapting to shifting policies and market dynamics, ensuring long-term resilience.

However, the report notes that many GCC energy players have yet to fully codify and deploy carbon accounting policies at the corporate level, let alone for individual products. Several GCC countries are still developing their regulatory and legislative agenda for carbon emissions. Additionally, robust methodologies and significant data management are needed to accurately allocate emissions from shared facilities, particularly in complex operations.

Four critical areas

The report recommends four critical areas for GCC energy companies to focus on:
1. Develop, codify and deploy robust product-level carbon accounting frameworks that align with global regulations
2. Invest in advanced automation and data management systems for accurate emissions reporting and real-time policy compliance
3. Focus decarbonisation efforts on products exported to high-regulation markets, ensuring compliance and competitive advantage
4. Investing in capabilities to continuously track and respond to shifting carbon policies globally, ensuring adaptability and leadership

As the GCC continues to position itself as a global energy leader, transitioning to product-level decarbonisation represents a pivotal opportunity to lead by example. By taking these steps now, GCC energy companies will be well-positioned to navigate future changes, fostering resilience and growth in a carbon-conscious world.