Russia’s Invasion Supercharges Push to Make a New Green Fuel

Europe’s push to wean itself off Russian natural gas is sparking billions of dollars in new commitments toward building a market for low-carbon hydrogen.

A nearly 450% jump in European gas prices the past year made the green fuel of the future cost-competitive about a decade ahead of schedule, according to BloombergNEF. Now, investment funds are joining governments and utilities in ambitious plans to make hydrogen a viable substitute for fossil fuels in manufacturing, transportation and heating.

“It’s kind of a tipping point,” said Phil Caldwell, chief executive officer at Ceres Power Holdings Plc, a U.K.-based hydrogen technology company. “You’re going to see that capital coming in on a big scale now. There’s no turning back.”

Russia is ostracized on the world stage for invading Ukraine, but some of the harshest critics still need its oil and gas to keep their economies running. Europe is quickening efforts to break that addiction, with Fortescue Metals Group Ltd. planning a $50 billion project for the hydrogen supply chain with German energy giant E.On SE; Norway’s Scatec ASA building a $5 billion production plant; and investment fund Hy24 earmarking $1.6 billion for infrastructure.

The case for hydrogen already was growing, primarily because of its climate benefits, but the war broadened investor interest by highlighting the need for energy security, Fortescue’s billionaire founder, Andrew Forrest, said in an interview.

“It has accelerated money flows,” Forrest said in London. “After the tanks rolled across the border, there’s none of that conscience at work in people’s minds. It is a physical, fiscal necessity.”

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