National Hydrogen Strategy
The UAE launched its National Hydrogen Strategy in 2023, establishing targets to capture 25% of key global hydrogen export markets by 2031. The strategy positions the UAE as a dual-pathway producer, leveraging its low-cost solar resources for green hydrogen and its established gas infrastructure for blue hydrogen with carbon capture.
Hydrogen is viewed as a critical bridge fuel for decarbonizing sectors where electrification alone is insufficient: heavy industry, maritime shipping, aviation, and long-distance freight transport. The UAE’s geographic position between European and Asian demand centers provides a natural logistical advantage for export-oriented production.
Production Targets
| Hydrogen Type | 2025 Target (MTPA) | 2030 Target (MTPA) | 2031 Target (MTPA) | Key Producers |
|---|---|---|---|---|
| Green Hydrogen | 0.2 | 1.0 | 1.4 | Masdar, ADNOC |
| Blue Hydrogen | 0.5 | 1.5 | 2.0 | ADNOC |
| Total | 0.7 | 2.5 | 3.4 | – |
MTPA = million tonnes per annum. Green hydrogen is produced via electrolysis powered by renewable electricity. Blue hydrogen is produced from natural gas with CO2 capture and storage.
Major Projects and Partnerships
Green Hydrogen Initiatives
- Masdar Green Hydrogen Plant (Abu Dhabi): 200 MW electrolyzer facility powered by dedicated solar PV, producing up to 30,000 tonnes of green hydrogen annually. Commissioning commenced in 2025.
- DEWA Green Hydrogen Pilot (Dubai): Demonstration-scale facility at the Mohammed bin Rashid Solar Park producing hydrogen for transport and industrial blending applications.
- Masdar-ENGIE Joint Venture: Development agreement for up to 2 GW of UAE-based green hydrogen capacity targeting ammonia conversion for export to European markets.
Blue Hydrogen Initiatives
- ADNOC Ruwais Blue Ammonia: World-scale blue ammonia facility with capacity of 1 MTPA, utilizing hydrogen from natural gas reforming with CO2 routed to ADNOC’s carbon capture network. First production expected in 2026.
- ADNOC Ta’ziz Blue Hydrogen: Integration with the Ta’ziz industrial ecosystem at Ruwais, supplying hydrogen feedstock to chemicals production and generating export-grade ammonia.
Cost Competitiveness Analysis
| Production Pathway | Current Cost ($/kg H2) | 2030 Target ($/kg H2) | Key Cost Driver |
|---|---|---|---|
| Green (UAE Solar) | 4.50 - 5.50 | 2.00 - 2.50 | Electrolyzer capex, solar LCOE |
| Blue (UAE Gas + CCS) | 1.80 - 2.20 | 1.50 - 1.80 | Gas feedstock price, CCS efficiency |
| Grey (No CCS, reference) | 1.20 - 1.50 | 1.20 - 1.50 | Gas price only |
The UAE’s extremely low solar electricity costs provide a structural advantage in green hydrogen production. Electrolyzer cost reductions, driven by manufacturing scale-up in China and Europe, are expected to close the gap with blue hydrogen by the late 2020s. Blue hydrogen remains cost-competitive in the near term and benefits from ADNOC’s existing gas processing infrastructure.
Export Corridors
The UAE is developing hydrogen and ammonia export logistics targeting three primary markets:
- Europe (Germany, Netherlands, UK): Ammonia and liquid hydrogen shipments via established shipping routes through the Suez Canal. Bilateral agreements signed with Germany and the Netherlands establish demand offtake frameworks.
- Japan and South Korea: Ammonia co-firing for power generation represents the largest near-term demand pool. ADNOC has signed multi-year supply memoranda with JERA and Korea Gas Corporation.
- India: Industrial hydrogen demand for refining and fertilizer production, with proximity enabling cost-effective pipeline or short-sea transport.
Infrastructure Requirements
Scaling hydrogen production to multi-million-tonne volumes requires substantial infrastructure investment:
- Electrolyzer Manufacturing: Masdar has invested in partnerships to establish regional electrolyzer assembly capacity
- Ammonia Conversion: Ammonia serves as the primary hydrogen carrier for maritime export, requiring dedicated synthesis and cracking facilities
- Port Infrastructure: Ruwais and Khalifa Port are being expanded with hydrogen and ammonia loading terminals
- Water Supply: Green hydrogen electrolysis requires significant freshwater; desalination capacity co-located with electrolyzer plants is planned
Outlook
The UAE’s hydrogen strategy is one of the most comprehensive among global energy exporters, combining immediate blue hydrogen production with a clear pathway to green hydrogen scale. The critical execution challenge lies in simultaneous delivery of electrolyzer capacity, renewable power supply, and export logistics. Success would position the UAE as a dominant hydrogen supplier to decarbonizing economies while creating a durable revenue stream beyond traditional crude oil exports.