PETALING JAYA: Malaysia aims to produce two million tonnes of hydrogen annually by 2030., scaling up to 16 million tonnes by 2050, under the Emission Driven Scenario (EDS), according to Science, Technology and Innovation Minister Chang Lih Kang.
He said the successful implementation of the Hydrogen Economy and Technology Roadmap (HETR) will enable Malaysia to tap into this lucrative market, with potential revenue estimated to be at least RM905 billion by 2050 under the EDS.
“The global green hydrogen market is projected to reach a staggering US$189.19 billion (RM840 billion) by 2050, with Asia-Pacific accounting for 43% of this market, followed by Asean with 13%, and Malaysia at 2%. As we transition to cleaner energy, hydrogen will play a key role alongside other renewables in Malaysia,” Chang stated in his keynote speech at FMM Energy Efficiency & Conservation Conference 2024 organised by the Federation of Malaysian Manufacturers today.
He said embracing hydrogen is not just about tackling climate change but it is also about reducing the country’s dependence on fossil fuels and protecting publics’ health. “The shift will help decarbonise critical sectors like power generation and transportation, reducing greenhouse gas emissions by up to 10%.”
Through the HETR, Malaysia plans to phase out fossil-fuel-based grey hydrogen in the short term and transition towards green hydrogen in the long term.
“To bridge the gap, blue hydrogen will play a crucial role by leveraging existing fossil fuel infrastructure while incorporating carbon capture to reduce emissions,” Chang said.
From 2030 to 2040, he added, efforts will focus on making green hydrogen more cost-competitive by improving technology and efficiency to pave for a sustainable future. “Blue hydrogen will be critical for industries like metal, steel, oil and gas refining, and ammonia production, where emissions are harder to reduce.”
However, Chang said, the main challenge is cost where hydrogen is currently twice the price of unsubsidised RON 97 fuel and much higher than subsidised RON 95.
“While the HETR projects that hydrogen will become cheaper than diesel by 2050 as subsidies shift, we believe it’s time to start redirecting energy subsidies towards renewables like hydrogen now. This gradual shift, alongside financial incentives for cleaner fuels, can help accelerate the transition towards a sustainable energy future,” he said.
Chang pointed to key strategies to accelerate the adoption of green hydrogen, including offering financial incentives such as Green Investment Tax Allowance and Green Income Tax Exemption for hydrogen-related projects, alongside e-dana support for innovation and commercialisation.
“Plans are also under way to make fuel cell electric vehicles more affordable through subsidies and tax exemptions on sales, imports, and road use.”
Chang said financing mechanisms such as low-interest loans, venture capital funds, and public-private partnerships are being explored to support hydrogen infrastructure and projects. Capacity building is another priority with training programmes designed to equip industry professionals, researchers and policymakers with the necessary skills to drive the hydrogen economy forward, he added.
“Demonstration projects in transportation, power generation, and industrial processes will also receive support to showcase the potential of hydrogen technologies across various sectors,” said Chang
