Is hydrogen a sustainable asset class?
Hydrogen is likely to be marginal in sustainable impact portfolios compared with electrification and renewables
Exposure to hydrogen remains marginal in the portfolios of sustainable impact investors, with emissions intensity across the value chain a key factor when considering its credentials as a green investment. While hydrogen produced from electrolysis using renewable or nuclear power has a much lower emissions intensity than grey hydrogen, for many applications—including light-duty transport, power generation and heating—direct use of renewables via electrification can often be regarded as more sustainable. “There are fewer energy losses, fewer risks of gas leakage and explosions as well as less exposure to risks of water stress compared to hydrogen—at least for wind and solar power,” Elchin Mam
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