Malaysia Targets Hydrogen Leadership with Bold Goals for 2030

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Malaysia is setting its sights on becoming a global hydrogen powerhouse. According to Science, Technology, and Innovation Minister Chang Lih Kang, the country aims to produce two million tonnes of hydrogen annually by 2030 and scale up to 16 million tonnes by 2050. Under the Emission Driven Scenario (EDS) outlined in the Hydrogen Economy and Technology Roadmap (HETR), the country projects hydrogen to become a key pillar of its green energy transition, with potential revenues of RM905 billion by 2050.

Tapping Into a Global Hydrogen Boom

Speaking at the FMM Energy Efficiency & Conservation Conference 2024, Chang highlighted that the global hydrogen market is forecasted to reach US$189.19 billion (RM840 billion) by 2050, with Asia-Pacific expected to capture 43% of the market. Within this, Malaysia aims for a 2% share, valued at approximately RM16 billion annually.

“Hydrogen is not just about addressing climate change; it’s about reducing dependence on fossil fuels and enhancing public health by cutting harmful emissions,” Chang stated. He noted that the shift to hydrogen could reduce Malaysia’s greenhouse gas emissions by up to 10%, particularly in critical sectors like power generation and transportation.

Phasing Out Fossil Fuels: A Three-Stage Approach

The HETR outlines a phased transition away from fossil-fuel-derived grey hydrogen toward green hydrogen, with blue hydrogen acting as a bridge technology:

1. 2024-2030: Gradual phase-out of grey hydrogen, leveraging existing fossil fuel infrastructure to produce blue hydrogen with integrated carbon capture.
2. 2030-2040: Focus on advancing green hydrogen technologies to achieve cost parity with conventional fuels, fostering competitiveness.
3. 2040-2050: Full-scale adoption of green hydrogen, targeting wide-scale industrial and consumer use across sectors like steel, ammonia production, and oil refining.

“Blue hydrogen will be crucial in industries where emissions are hard to mitigate, such as metal refining and ammonia production, while we work towards making green hydrogen more cost-efficient,” Chang explained.

Cost Challenges and Subsidy Shifts

One of the biggest hurdles remains cost: hydrogen fuel is currently twice the price of unsubsidized RON 97 fuel and significantly costlier than subsidized RON 95.

Chang emphasized the importance of redirecting subsidies toward renewables like hydrogen, predicting that hydrogen will become cheaper than diesel by 2050. “By gradually reallocating energy subsidies and offering financial incentives, we can accelerate the adoption of sustainable energy solutions.”

Accelerating Green Hydrogen Adoption

To catalyze the hydrogen economy, the government is pursuing several strategic initiatives:

• Financial Incentives: Green Investment Tax Allowance and Green Income Tax Exemption for hydrogen-related projects.
• Affordable Fuel Cell Vehicles: Subsidies and tax exemptions on sales, imports, and road usage to make fuel cell electric vehicles accessible to the masses.
• Financing Mechanisms: Low-interest loans, venture capital funds, and public-private partnerships to support infrastructure and hydrogen-related projects.
• Capacity Building: Training programs for industry professionals, researchers, and policymakers to build expertise in hydrogen technologies.
• Demonstration Projects: Showcase hydrogen’s potential in transportation, power generation, and industrial processes to drive adoption across multiple sectors.

A Vision for a Sustainable Future

Chang reiterated that Malaysia’s long-term vision is to establish itself as a regional leader in hydrogen production and technology innovation, capitalizing on its strategic location and access to renewable resources.

“Through partnerships, incentives, and innovation, we are confident Malaysia will play a pivotal role in the global transition to cleaner energy,” he concluded.

This ambitious roadmap underscores Malaysia’s commitment to combating climate change while securing a sustainable and economically beneficial future for its citizens.