Green Hydrogen was the darling of 2023, promising to decarbonize everything. By 2026, reality has set in. The physics works, but the economics are brutal. Transporting hydrogen is a nightmare, and producing it is expensive.
The market has pivoted to “Industrial Clusters.” The only viable business model right now is co-locating production and consumption. You don’t build a hydrogen plant and ship the gas across the country; you build the hydrogen plant inside the steel mill or the fertilizer factory.
Investors have pulled back from general-purpose hydrogen startups and are focusing on “off-takers”—companies that have signed contracts to actually buy the gas. If you don’t have a buyer, you don’t have a business.