Key Takeaways from the Green Hydrogen Policy Accelerator Training Course in Cairo

Last week we hosted our Green Hydrogen Policy Accelerator Training Course which took place in Cairo, Egypt between August 18-23. The course, co-hosted with the International Solar Alliance, was held at Nile University in Cairo, where participants from 14 countries across Africa and Latin America gained comprehensive insights into the green hydrogen economy.?

Here are eight takeaways from the course on green hydrogen offtake and how governments can best host large-scale renewable energy and green hydrogen projects:?

Key Takeaways:?

1. Securing reliable offtake agreements and ensuring bankability:?Everyone highlighted the need for securing offtake, which remains challenging. During our sessions on Finance Day, Marwa Mostafa Khalil at the IFC - International Finance Corporation highlighted the playbook for selecting green hydrogen projects, emphasizing bankability, offtake, and technology as the top three risks. This was further confirmed by Lamyaa Gadelhak of 贝克?麦坚时 McKenzie who stressed the importance of good legislative practices coupled with government support as key in securing an offtake agreements. Countries like Egypt, Mauritania and Morocco emphasized the need for government support in creating stable and predictable regulatory environments, which are essential for attracting offtakers and mitigating risks, thereby enhancing the financial viability and investor confidence in these projects.?
2. Developing critical infrastructure and addressing land access: Countries including Ethiopia, Uganda, and Djibouti emphasised the importance of securing land rights and developing necessary infrastructure, such as grid networks and roads, to support green hydrogen projects. Responsible land acquisition that respects both formal and customary tenure rights is crucial to mitigate risks and ensure sustainable development. Djibouti also highlighted the need for clear land acquisition frameworks to facilitate investment.?
3. Streamlining permitting processes: Many participants stressed the necessity of establishing a "one-stop shop" for permits with clear timelines and processes to expedite green hydrogen investments. This approach reduces bureaucratic delays and enhances the attractiveness of these projects to developers. Countries like Panama are particularly focused on creating a business-friendly environment through streamlined procedures and robust regulatory frameworks.?
4. Ensuring sustainability of incentives and fiscal support: Ethiopia, Uganda, and Panama are actively providing tax incentives, subsidies, and feed-in tariffs to promote green hydrogen projects. Similarly, Egypt offers significant tax credits and exemptions for green hydrogen projects, with incentives like VAT exemptions (between 33% & 55%), seaport fee discounts (30%), and industrial land rights discounts of 20%, while Mauritania provides VAT and export tax exemptions, reduced import duties (from 4% to 2%), and a staged corporate income tax for similar projects. However, Panama, along with Morocco, emphasized the need to plan for the eventual phasing out of these incentives to ensure long-term sustainability. This includes creating investment de-risking mechanisms to maintain investor confidence even as direct incentives are gradually reduced.?
5. Standardising a framework for global standards and certification: Egypt, Mauritania, and Morocco underscored the importance of establishing robust certification frameworks to demonstrate renewable electricity use and ensure market acceptance of green hydrogen products, which is crucial for international trade. GH2’s Sam Bartlett spoke on the book and claim model emphasizing the potential to stimulate market and production by separating certificates from physical products. This can ensure early market development despite infrastructure constraints if managed carefully and with robust governance.?
6. Managing human rights and environmental risks: Mauritania, Djibouti, and Namibia spoke on the importance of addressing human rights and environmental risks associated with green hydrogen projects. There is a clear need to emphasise the importance of engaging in meaningful multi-stakeholder dialogues, ensuring free, prior, and informed consent (FPIC), and implementing effective grievance mechanisms to protect affected communities and ensure the social license to operate.??
7. Enhancing legislative and policy frameworks: The training course underscored the critical role of enabling legislation in promoting the bankability of green hydrogen projects. Countries like Egypt, Morocco, and Tunisia are working on developing comprehensive legal frameworks that support green hydrogen markets. These frameworks need to balance national strategies with attracting investment and managing risks effectively to support the emerging green hydrogen economy?
8. Prioritising societal and local benefits: There was a consensus among participants that there is a clear need to articulate how green hydrogen projects will benefit society, especially since many projects are export oriented. Several participants agreed that grid decarbonisation should be a priority. Numerous countries are exploring microgrids and long-duration energy storage as major domestic applications, especially in contexts where local refineries and fertilizers do not exist. Generally, local populations should be given the clear opportunity to understand and learn how their communities benefit from green hydrogen strategies and investment. Capping international employment and requiring local content is an effective way to ensure projects benefit their local communities. For example, Egypt mandates a 20% local content requirement and caps international employees at 30%. ?

This training session generated numerous insightful ideas for advancing green hydrogen in regions primed for its development. We hope these takeaways will not only benefit our participants but also offer valuable insights to others as we take this crucial step in the energy transition.?

Beyond the takeaways, our visit to the Suez Canal Economic Zone (SCZone) provided a deeper understanding of Africa’s first integrated green hydrogen plant. This ground-breaking project includes 100 MW of green hydrogen and 50 KTPA of green ammonia capacity, supported by a $417 million investment. It also incorporates 70 MW of solar and 190 MW of wind energy. The SCZone has signed 15 agreements and 8 MOUs, aiming for an annual production capacity of 33 million tons, with a total investment of $133 billion, covering 28 million sqm of industrial land and 2.4 million sqm of port land.?

Vanina Morrison

Communications and Advocacy Officer

Green Hydrogen Organisation

Upcoming Events

The Venice Hydrogen Forum,?organized jointly by GH2 and Venice Sustainability Foundation is a ministerial and CEO level international meeting on the transport, offtake and project finance of hydrogen and its derivatives across the Mediterranean. It will focus on the connection between European hydrogen infrastructure and major green hydrogen production centres in North Africa and the Middle East. It is designed as a semi-retreat for high-level decision makers to push the needle on agreements and policies to develop cross-Mediterranean hydrogen trade which is urgently needed and ensure local value creation wherever green hydrogen is produced.

Check out the updated agenda here.

Find out more here on how to participate.

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