Our Perspective
Our Perspective
Hydrogen offers a compelling alternative to fossil fuels in the mobility sector, with potential for decarbonizing transportation and serving as a cornerstone of the sustainable mobility ecosystem.
As the world pivots toward sustainability, hydrogen is emerging as a compelling alternative to fossil fuels, particularly in the mobility sector. With zero emissions at the point of use and a high gravimetric energy density (120–142 MJ/kg) — a measure of the energy stored per unit of mass — hydrogen presents a strong case for decarbonizing transportation. Major energy companies in mobility space increasingly view hydrogen as a strategic component of their energy transition portfolios. Its potential extends beyond passenger vehicles to long-haul freight, aviation, and maritime transport, positioning hydrogen as a key resource in the future of clean mobility.
Despite these benefits, the adoption of hydrogen in mobility must overcome several challenges for full implementation, including high production costs, gaps in infrastructure, safety concerns, and limited consumer awareness. Addressing these challenges requires a combination of technological innovation, policy intervention, and strategic investment. Technology can accelerate the transition, and digital solutions—such as artificial intelligence (AI), blockchain, and the Internet of Things (IoT)—can help optimize hydrogen production, storage, distribution, and use, positioning it as a cornerstone of the sustainable mobility ecosystem.
The widespread adoption of hydrogen relies on effectively overcoming economic, logistical, and technological barriers. Tackling these obstacles is essential for establishing hydrogen as a viable mobility solution.
1. Production Costs and Energy Inefficiencies
Hydrogen production remains expensive, particularly when derived from renewable energy sources. Producing one kilogram of green hydrogen via electrolysis requires approximately 50–55 kilowatt-hours (kWh) of electricity for 1 kg of hydrogen, whereas steam methane reforming (SMR) uses only 45 kWh per kg of hydrogen, making fossil fuel-based hydrogen more energy-efficient. Even if we were to obtain hydrogen free from a carbon footprint through carbon capture to produce blue hydrogen, it is still more cost-effective than green hydrogen. This is evident from the production cost of blue hydrogen being USD 2.8 – 3.5/kg of H2, compared to green hydrogen’s USD 4 – 6/kg of H2. This high energy demand drives up costs, making green hydrogen less competitive than fossil fuels.
While 96% of the hydrogen used today is derived from fossil fuels (brown and gray hydrogen), the push for decarbonization is driving investment in cleaner alternatives. The challenge lies in reducing production costs and ensuring a stable supply of renewable energy to support hydrogen production. AI-driven predictive analytics can play a crucial role by monitoring real-time electricity prices, weather conditions, and energy demand, enabling electrolyzers to operate when renewable electricity is most cost-effective.
2. Infrastructure Gaps and Distribution Bottlenecks
Hydrogen infrastructure is still developing. While electric vehicle (EV) charging stations are increasingly prevalent, hydrogen refueling stations remain scarce, hindering widespread adoption. One possible solution involves retrofitting existing natural gas pipelines for hydrogen transport. However, we must remember that hydrogen’s low energy density and high storage needs will require dedicated pipelines and specialized transport systems to make this feasible.
Investment in hydrogen infrastructure is on the rise, yet committed investments are still lacking visible progress. The European Union intends to install 40 GW of renewable hydrogen electrolyzer capacity by 2030, anticipating over 750 projects to be operational by 2025. Germany is at the forefront with a hydrogen pipeline network spanning 525 kilometers, expected to expand to 9,040 kilometers by 2032. The European Commission has allocated additional funding through the REPowerEU plan, aiming to double the number of Hydrogen Valleys across Europe by 2025. This funding will support various initiatives throughout Europe, particularly in Spain, Italy, and Portugal, to bolster hydrogen infrastructure and encourage regional collaboration.
In the United Kingdom, the government is actively supporting the development of hydrogen infrastructure through a variety of initiatives, including the Second Hydrogen Allocation Round (HAR2), which endeavors to attract investments exceeding £1 billion from the private sector by the year 2029. Furthermore, the United Kingdom has committed over £21 million to seven distinct projects that focus on the production of low-carbon hydrogen. Conversely, the United States is making significant investments in hydrogen hubs and production facilities as a component of its national clean hydrogen strategy. The Department of Energy has designated $750 million for 52 projects dispersed across 24 states, aimed at reducing hydrogen costs and solidifying American leadership within the hydrogen industry. In addition, China is recognized as the global leader in green hydrogen, boasting nearly 7 GW of installed capacity as of 2023. The China Hydrogen Alliance anticipates that hydrogen demand will escalate to 35 million tons by the year 2030.
AI-powered logistics optimization and blockchain-based tracking can enhance the efficiency of hydrogen distribution, ensuring minimal losses and greater transparency in supply chains. Real-time monitoring via IoT sensors can detect leaks, optimize storage conditions, and manage refueling stations more effectively.
3. Safety and Consumer Perception
Hydrogen’s flammability and low molecular weight raise concerns about leakage and safety in both transportation and storage. However, advancements in tank materials, automated safety monitoring, and AI-powered predictive maintenance are reducing these risks. For instance, hydrogen fuel cell vehicles (FCVs) from major automobile manufacturers have undergone rigorous safety testing, demonstrating their resilience under high-pressure conditions.
Public perception remains a challenge. Many consumers are unaware of hydrogen’s safety measures and benefits, leading to hesitancy in adoption. AI-driven marketing campaigns and digital engagement strategies can help educate consumers and fleet operators, promoting greater acceptance of hydrogen mobility.
Digital innovation is transforming the hydrogen economy, enhancing production, storage, and distribution to be smarter and more efficient. AI, IoT, and blockchain are creating new opportunities for scalability and sustainability.
Optimizing Production with AI and IoT
From efficiency gains to resource conservation, AI and IoT are making hydrogen production smarter and more cost-effective:
Enhancing Storage and Transportation Efficiency
Safe and cost-effective hydrogen storage is critical to scaling adoption, and digital solutions are addressing key challenges:
Streamlining Hydrogen Distribution
AI and digital twins are optimizing hydrogen logistics, making distribution more cost-effective and scalable:
Government policies play a crucial role in accelerating hydrogen adoption. Subsidies, carbon pricing mechanisms, and public-private partnerships can make hydrogen more competitive with fossil fuels. Several countries are already implementing supportive policies:
Investment in hydrogen infrastructure — especially in refueling stations, dedicated pipelines, and grid integration—will be critical. Governments must also standardize regulations to facilitate cross-border hydrogen trade and encourage large-scale adoption.
While hydrogen adoption in mobility is still in its early stages, its potential as a clean, high-density energy carrier is undeniable. Unlike EVs, which rely on lithium-based batteries with resource constraints, hydrogen offers an alternative with rapid refueling times and long-range capabilities, particularly for heavy-duty transport and long-haul logistics.
For energy companies, investing in hydrogen aligns with long-term decarbonization goals and provides a pathway to diversify energy portfolios. Automotive manufacturers, logistics firms, and infrastructure developers must collaborate to build a scalable hydrogen ecosystem supported by digital innovation and regulatory frameworks.
The next decade will be pivotal. By integrating AI, IoT, and blockchain into hydrogen production, distribution, and refueling networks, stakeholders can overcome existing barriers and unlock hydrogen’s full potential in sustainable mobility.
Hydrogen is more than an alternative — it’s a driving force in the future of mobility.
Usloob Ahmad
Principal Consultant – Downstream (Oil & Gas), Low Carbon Fuels (SAF, LNG, etc.), Hydrogen and Decarbonization
Usloob Ahmad brings over 8.5 years of consulting experience across diverse sectors, including oil and gas, low carbon fuels (H2, SAF, LNG, etc.), sustainability, and shipping. He specializes in business analysis, business process re-engineering, system integration, and collaborative Scrum delivery. His expertise encompasses operations optimization in the energy sector, supply chain optimization, and decarbonization strategies deployment through the adoption of low carbon fuels (SAF, H2, etc.) and energy-efficient technologies.
Usloob has collaborated with prominent clients such as BP, Scotia Gas Network (SGN), Procter & Gamble, ABN AMRO Bank, Q8 (Kuwait Petroleum International), Intertek (Canada), and Hutchison Ports (UK). His roles have ranged from Product Owner to Strategy Consultant, where he has managed end-to-end product development, developed strategies for carbon reduction, conducted feasibility analyses for hydrogen projects, and formulated low carbon transition strategies.
Dr. Lakshmikantha Rao Hosur
Senior Partner – Energy, Resources, and Decarbonization
Lakshmikantha (Kantha) has over 20 years of consulting experience related to energy and the energy transition across Europe and North America. He has worked with clients and assets globally. Drawing on his deep knowledge of the energy value chain, Kantha is a strategist with a proven track record for delivering technology solutions — from ideation to go-to-market — and achieving delivery targets through consulting and portfolio management. Kantha holds a master’s degree in Geotechnical Engineering and a PhD in Soil and Rock Mechanics. He has previously worked with Repsol and Schlumberger (SLB) and is based in Amsterdam.
Parijat Prasun Panja
Consulting Partner - Energy Transition, Sustainability, Fleet & Mobility
Parijat has over 12 years of consulting experience in the energy, automotive, and manufacturing sectors, with a focus on Europe, APAC, and North America. He has collaborated with global clients such as bp, Shell, Chevron, Exxon, Petronas, IOCL, Jio-bp, Adani, Adnoc, Saudi Aramco, VARO, and Volta-Trucks, leveraging his extensive expertise in the energy value chain, including low carbon energy, EV charging, and decarbonizing value chains. Parijat is a product management practitioner known for delivering technology-driven solutions from ideation and discovery to market launch, consistently achieving targets through consulting and product management.
He holds an MBA from IIM Bangalore and a B.Tech in Mechanical Engineering. Parijat has previously worked with Mahindra Automotive across production, R&D, and innovation in engine technology. He is currently based in London, United Kingdom.
