In April 2023, PTT Group, Thailand’s state-owned oil and gas conglomerate, announced a $7 billion investment in producing green hydrogen with ACWA Power, Saudi Arabia’s leading renewable energy company.
The project aims to construct a plant in Thailand capable of producing 225,000 tons of green hydrogen yearly, equivalent to around 1.2 million tons of ammonia.
Green hydrogen is a type of renewable energy produced by splitting water molecules into hydrogen and oxygen using electricity from sources like solar or wind. Unlike fossil fuels, green hydrogen releases no greenhouse gases when in use, making it a sustainable alternative for various applications.
Green hydrogen is promising for powering heavy-duty electric vehicles (EVs) such as buses, trucks, and trains that require more energy than batteries can offer. Moreover, green hydrogen can be converted into ammonia used for fertilizers, chemical feedstock, or fuel for ships and power plants.
Thai government’s targets of carbon neutrality by 2050
The investment is part of PTT’s net-zero strategy aligned with the Thai government’s targets of carbon neutrality by 2050 and net-zero greenhouse gas emissions by 2065. PTT’s CEO Auttapol Rerkpiboon stated that the project is the first step towards turning Thailand into an international exporter of green power. Furthermore, he added that the objective is to provide green hydrogen and ammonia to power EVs in ASEAN countries and beyond.
The green hydrogen deal is crucial for diplomatic relations between Thailand and Saudi Arabia, which were reinstated in January 2022 after more than three decades of estrangement due to the Blue Diamond Affair. This significant deal is considered a sign of mutual trust and cooperation between the two countries, as well as a shared vision for a clean and prosperous future.
Global demand for green hydrogen is expected to reach 800 million tons by 2050, up from less than a million tons currently. The International Energy Agency (IEA) predicts that green hydrogen could account for 19% of total final energy consumption by 2050 with strong policies and investments. Thailand and Saudi Arabia are two countries that are taking proactive steps to become leaders in the green hydrogen industry, creating new economic opportunities and strengthening bilateral ties.
Global demand for green hydrogen could reach 800 million tons by 2050
Green hydrogen is expected to play a vital role in the global energy transition towards decarbonization, and countries are taking proactive steps to tap into this potential.