MOSTI AIMS TO PRODUCE TWO MLN TONS OF HYDROGEN ANNUALLY BY 2030

PETALING JAYA, Nov 27 (Bernama) --  The Ministry of Science, Technology, and Innovation (MOSTI) aims to produce two million tons of hydrogen annually, scaling up to 16 million tons by 2050 in an Emission Driven Scenario (EDS) under the Economy and Technology Roadmap (HETR).

Science, Technology, and Innovation Minister Chang Lih Kang said the transition will support the decarbonisation of key sectors like power generation and transportation, cutting greenhouse gas emissions by up to 10 percent, reducing the country's reliance on fossil fuels, and contributing to tackling climate change.

"Malaysia plans to phase out fossil-fuel-based grey hydrogen in the short term and transition towards green hydrogen in the long term through HETR.

"To bridge the gap, blue hydrogen will play a crucial role by leveraging existing fossil fuel infrastructure while incorporating carbon capture to reduce emissions.

From 2030 to 2040, the focus would be on making green hydrogen more cost-competitive by improving technology and efficiency, paving the way for a sustainable future," he said in his keynote speech at the Federation of Malaysian Manufacturers’s Energy Efficiency and Conservation Conference 2024, here today.

He added that blue hydrogen is harder to reduce as it is critical for industries like metal, steel, oil, and gas refining as well as ammonia production.

Chang said the main challenge is the cost where hydrogen is currently twice the price of unsubsidised RON 97 fuel and much higher than the 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 added.

Chang said key strategies to accelerate the adoption of green hydrogen include offering financial incentives such as Green Investment Tax Allowance and Green Income Tax Exemption for hydrogen-related projects as well as e-dana support for innovation and commercialisation.

"The global green hydrogen market is projected to reach a staggering USD189.19 billion by 2050, with Asia Pacific accounting for 43 percent of the market, followed by ASEAN with 13 percent and Malaysia at two percent.

"The successful implementation of the HETR enables the country to tap into this lucrative market, with potential revenues projected to reach at least RM905 billion by 2050 under the EDS," he added.

Meanwhile, Chang said plans to make Fuel Cell Electric Vehicles more affordable are also underway, through subsidies and tax exemptions on sales, imports, and road use. 

He added that 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 said.

Besides that, Chang also shared that MOSTI is closely working with Malaysia-based Petroleum Nasional Berhad (PETRONAS) in advancing blue hydrogen.

"By 2025, PETRONAS plans to build a world-class CCUS facility in Sarawak, costing USD260 million and capable of storing 3.3 million tonnes of CO2 annually for 25 years. These initiatives will help position Malaysia as a leader in sustainable energy solutions," he said.

Chang added that MOSTI is collaborating closely with international partners such as UNIDO on the Global Clean Hydrogen Programme to enhance Malaysia's green hydrogen capabilities.

This includes refining policies, launching pilot projects, and fostering collaboration among key stakeholders, with NanoMalaysia, an agency under MOSTI, playing a pivotal role.

"NanoMalaysia, in collaboration with UMW Toyota Motor, is driving forward hydrogen mobility initiatives with the upcoming launch of Malaysia’s first Mobile Hydrogen Refuelling Station in Putrajaya by early 2025, reflecting our commitment to clean energy.

"Through platforms like the Malaysia Hydrogen Industry Alliance, local companies across the hydrogen value chain are working together to turn research into real-world solutions, driving technological development, investment, and collaboration," he said.

Chang said that HETR, Malaysia's first roadmap dedicated to transitioning the country into a hydrogen economy, focuses exclusively on the entire hydrogen supply chain—from raw materials and production to storage, transportation, and end-use applications such as mobility, industry, and stationary uses.

-- BERNAMA