Hydrogen factfulness: Part I

This summer, thanks to a recommendation from our good friend Eugenio Trillo (The Lean Hydrogen Company), I came across and read the book Factfulness. In it, the author, Hans Rosling, shares data, personal experiences, and—above all—perspective. His goal is to help us cut through the noise of headlines and tragic videos, and encourage us to approach reality based on facts and indicators, not on assumptions or prejudice.

I’ve never really believed people when they say, “that book changed my life.” But I do think this one offers some valuable tools for looking at the reality of what we experience in our daily lives.

With that in mind, in this post-summer analysis, we at AtlantHy want to shed a bit of light on the current uncertainty in the sector—and, more importantly, everything surrounding it.

We’ll divide this analysis into two parts, with the second to follow in the next newsletter. Everything is based on back-of-the-napkin calculations. As you’ll see, we’re not going into technical detail. But we hope this exercise reinforces the effort we’ve been making for five years now: developing the hydrogen sector.

Where do we stand?

It might feel like we’re veterans now, but the reality is that the global race for renewable hydrogen only really began five years ago, in 2020. That was when the EU published its hydrogen strategy. This time, it took the lead, followed by China in 2022 and the US in 2023.

Some might argue that renewable hydrogen projects existed before 2020 —that there were already companies with decades of experience and proven technologies. And it’s true. But the scale of the sector has grown exponentially with the arrival of new companies, professionals… and money. A lot of money.

Still, back in 2020, even though we were just rookies, it felt like developing the sector—and especially the projects—was going to be much easier. Projects started popping up like mushrooms. If you didn’t have 1 GW in your pipeline, you weren’t taken seriously, and tapping into the natural gas pipeline to inject hydrogen was seen as standard. “We’ll be able to inject up to 20% into the gas grid—pipes can handle it,” some said.

Others of us were fighting to “squeeze” hydrogen into any kind of industry—ranging from chemical plants to cement factories, and even small businesses that were already struggling just to pay their monthly gas bills.

Let’s not forget the attempts to inject hydrogen into combined-cycle power plants, or to deploy large fleets of hydrogen-powered buses or trucks. All of this happened at a time when—surprise—there was no proven technology, nor any serious manufacturers with ready production lines.

How has the development progressed over these past few years?

Throughout 2021 and 2022, development and scouting work was intense. Combined with the rise in energy costs, this led many industrial consumers to show interest in alternatives. Many joined discussions to become offtakers in renewable hydrogen projects for thermal purposes… it went poorly in most cases.

From 2023 onwards, many developers began to realise that hydrogen isn’t just a matter of installing four containers and starting to produce. These are industrial projects with many layers that need careful attention to reach completion—from the end user to environmental aspects, associated renewables, and the dreaded grid connection. Disinterest began to creep in, departments for biomethane were opened, and of course, the murmurs started.

In 2024, the sector’s stagnation became clear. Projects moved forward at a trickle, companies began divesting from their hydrogen departments, others entered bankruptcy proceedings, and negative headlines started to dominate the news.

Now, in 2025, the situation seems to be repeating itself. The sector remains static, waiting for clear regulations on the demand side—regulations that would help create a market by bridging the “price gap” needed to generate real consumers. And in many cases, still lacking a grid connection point that is unlikely to ever arrive.

If someone had told us in 2020 that this is where we’d be five years later, we wouldn’t have believed it.

Have we failed?

Has a child failed just because they grow up and don’t become a footballer or an astronaut?

It might seem like an exaggerated comparison, but I think it fits perfectly. The truth is that, in 2020, we were naïve. Some lacked understanding of the technologies; others didn’t grasp how the energy system or the regulatory processes really worked.

What seemed easy hasn’t been—and we’re practically in the same place as in 2020… or are we?

Five years—that’s exactly the time the Chinese bamboo metaphor tells us the plant spends growing roots before it starts to grow rapidly.

At AtlantHy, we believe that our sector—though not intentionally—has been laying down roots and separating the wheat from the chaff. As a result, we now find ourselves in a much more favourable position than we were at the start of the decade.

This is where we begin our Hydrogen Factfulness. Because many of those roots have indeed taken hold, even if there are still loose ends to tie up.

Installed electrolyser capacity worldwide has multiplied by 9 between 2021 and 2025

Reaching a total of 5 GW installed by the end of July 2025. While it’s true that 60% of this capacity is in China, the fact that the industry has taken off globally shows that there is appetite—and, in many cases, both technical and economic viability. We recommend exploring the Hydrogen Council’s tool (https://compass.hydrogencouncil.com), which provides an overview of the key enablers that have helped many projects reach successful FIDs.

Illustration 1. Installed electrolyser capacity (IEA Global Hydrogen Review 2025)

Electrolyser production capacity now stands at 57 GW/year — a sixfold increase compared to 2021

Let’s be honest: many manufacturers have been just as optimistic as we were, putting the cart before the horse. They invested tens or even hundreds of millions of euros in electrolyser production plants that didn’t exist in 2020. This multiplied available capacity by six and, more importantly, significantly reduced manufacturing costs thanks to automated lines and fit-for-purpose facilities. Along the way, players like MCPHY have fallen — despite having received over €100 million from the French government for a factory — as well as Green Hydrogen Systems. However, their assets and know-how have since been acquired by others. Their efforts were not in vain, and this has marked the beginning of a consolidation process that still has a way to go.

As far as the sector is concerned, what didn’t exist in 2020 does exist today—not to mention the Chinese expansion, with 38 GW/year of manufacturing capacity.

Illustration 2. Electrolyser manufacturing capacity (IEA Global Hydrogen Review 2025)

Over 110 billion dollars have already been committed to hydrogen production projects that have passed FID

While to the casual observer it might seem like nothing is moving, global investment in hydrogen projects has grown from €10 billion in 2020 to €110 billion today—an 11-fold increase. It’s undeniable: this is underway. Yes, it’s true that it’s still not enough to meet global targets, and it’s not progressing at the speed we’d like. And yes, for us in Spain, we know that only a small portion of that funding belongs to domestic projects. But the global development of the sector makes everything easier—whether it’s technological maturity, product availability, or cost reductions. Besides, more than 500 projects have already reached FID, which means they will soon be under construction or entering operation.

Illustration 3. Committed investment and its distribution in hydrogen projects that have passed FID (Hydrogen Council)

Large-scale projects show that it is indeed possible

Five years ago, there were hardly any reference projects producing renewable hydrogen for the purpose of decarbonising end-use applications. Today, however, projects of up to 500 MW of electrolysis exist—such as the Chifeng Hydrogen Project, the largest to date. There’s no need to focus solely on projects of that scale: in Europe and the US, we’ve already seen projects in the tens of megawatts installed, and others in the hundreds currently under construction. An example worth highlighting is the Kasso project by European Energy. While its electrolysis capacity stands at 50 MW, it also integrates a photovoltaic plant, a methanol facility, and even a district heating system to supply heat to nearby homes and industries.

Illustration 4. Chifeng Hydrogen Project (Hydrogen Insight)

Illustration 5. Kasso e-methanol plant (European Energy)

These real-world implementations not only prove that it is possible, but also help us better plan our future projects—understanding scale, requirements, construction timelines, and more. This is knowledge that has been developed over time and is now embedded within the sector.

The will of the institutions has taken shape

Never at the speed we would like and always with room for improvement, but the truth is that these have been extremely turbulent years for Europe—and the world—since 2020. Still, the facts show that in our continent, the direction set in 2020 has not only been maintained, but intensified.

In terms of regulation, Europe’s work is practically done. What remains is to formalise the section on low-carbon hydrogen and to finalise, by 2026, the remaining aspects of the CO₂ framework, which also has an impact on our sector.

Worth highlighting here are FuelEU Maritime and ReFuelEU Aviation—regulations that, from day one, create a firm market for clean fuels. Then there are the delegated acts, which we may or may not fully agree with, and the RED III directive, which should be transposed into national legislation by May 2025.

In terms of funding, there are numerous programmes supported by the EU, some of which even extend to Spain. Many of these programmes have been poorly designed—yes—and in many cases the grants have been rejected. That’s also true. But they are now up and running, and they mean that a well-structured project has a strong chance of securing significant support.

In addition, the European Commission’s proposal to multiply available funding for clean energy by six for the 2028–2034 period suggests that the support is here to stay.

At the local level, in Spain, we are still waiting to see how regulation will require consumers to actually use hydrogen. Although we already have the draft Royal Decree on promoting renewable fuels on the table, some critical elements are still missing before we can kickstart the creation of a proper regulatory market. For example, we still don’t know what the final official quotas will be, what the penalties will look like or how they’ll be applied, or even how credit transfers between subsectors will work. We are still waiting for the Ministerial Order—and we don’t know when it will arrive. Likewise, the renewable hydrogen consumption quota for industry remains undecided, and there is still no news on that front.

Maturity of manufacturers, references, sales and service teams

Talking to a manufacturer five years ago was quite a peculiar experience. Do you remember the response times when trying to set up meetings, share information, or sign NDAs? These companies simply weren’t prepared to serve the sector. There were no sales teams, and in many cases, no real knowledge of their own products.

How many efficiency losses and cost increases did we witness between 2020 and 2022? What about reference lists? Operating hours? Most of these manufacturers didn’t even have the capability to deploy technical service support in our country. Fortunately, this has changed. Everyone—or at least I hope the vast majority of you who request quotes and deal with manufacturers on a daily basis—would agree that the sector’s maturity and solidity are on a different level today. These manufacturers now have experience delivering real projects. Take Plug Power, for example. In 2020, they barely had a 1 MW product with very few references. Today, I don’t go a month without seeing the delivery of several of their 5 MW units—or even the commissioning of their own 40 MW plant, which includes liquefaction of 15 tonnes of hydrogen per day.

The maturity of companies today is very different from what we encountered back then, which greatly contributes to the success of current projects.

Finally, the massive inflow of capital and interest in these companies has pushed manufacturers to improve their equipment—reducing costs, increasing efficiencies, and enhancing operability—which increasingly paves the way for the sector’s success.

Conclusions

Exercises like this allow us to assess where we are, gain some perspective, and understand the reasons why we’ve progressed less than expected. At AtlantHy, we continue with the same enthusiasm as on day one—but with a very different kind of conviction. One that is more mature, and shaped by everything we’ve been through.

We hope this first part has helped you realise just how much underlying progress has been made over these past five years—and that it’s about to start blooming.