Strategic Vision & Policy Framework - Hydrogen
South Africa’s Hydrogen Society Roadmap (2021) and the Green Hydrogen Commercialisation Strategy (GHCS) have been formally adopted, setting clear targets like deploying 10 GW of electrolyzer capacity in the Northern Cape by 2030 and producing ~500,000 tonnes per year of green hydrogen by then.
In April 2025, the government approved the Renewable Energy Masterplan (SAREM) to scale renewables, energy storage, and hydrogen production as part of the energy transition.
Financing & Partnerships
The Green Hydrogen National Programme includes a R300 billion ($19‑28 billion) pipeline of SIP‑registered projects, with 9 already registered and 11 pending.
The EU pledged $35 million in 2024 to support Transnet’s infrastructure and the broader value chain.
The SA‑H2 Fund, a blended finance vehicle, recently backed the Hive Hydrogen Coega green ammonia project with up to $20 million, tied to broader regional investment from the Netherlands and Denmark.
Additional international backing comes from Germany (H2Global), Japan (NEDO), the Netherlands, and others investing billions in exports and value‑chain development.
Major Projects & Scaling Up
Boegoebaai Green Hydrogen Hub in the Northern Cape (5–10 GW renewables capacity) aims to produce hydrogen derivatives and export them via a dedicated deep‑water port. It’s a phased project targeting 2028 for initial output and full scale by 2035, with projected production costs of $1.60–2.10/kg by 2030.
A 1,430 MW solar cluster in the Northern Cape will support hydrogen production and grid supply. It has full permits and is under development.
The Mogalakwena hydrogen valley near Mokopane links mining hubs (PGM-rich) to Johannesburg and Durban via a proposed hydrogen corridor, enabling hydrogen‑powered mining, mobility and export logistics.
Eskom has issued tenders for a pilot renewable green hydrogen facility at its Johannesburg R&D unit and is prioritizing hydrogen production as part of its path to net-zero by 2050.
Market Size & Economic Outlook
In 2023, South Africa’s hydrogen generation revenue was about USD 2.5 billion, projected to grow at ~7.5 % CAGR to reach USD 4.2 billion by 2030—transportation is the fastest-growing segment, while ammonia production is currently the largest.
Hydrogen demand is expected to rise from approximately 2.1 million tonnes in 2023 to ~3.0 million tonnes by 2034, with a CAGR of ~3.2 %.
The hydrogen sector could account for around 3.6 % of GDP by 2050, create upwards of 360,000–370,000 jobs, and generate billions in export revenue through green ammonia, synthetic fuels, and green steel.
Opportunities
Massive renewables potential: Northern Cape solar irradiation and coastal wind resources are among the world’s best.
Platinum Group Metals (PGMs): South Africa holds ~80 % of global PGM reserves, vital for electrolyzers and fuel cells.
Strategic infrastructure: existing port, rail and energy corridors in Saldanha, Coega, Richards Bay, and Johannesburg support export logistics.
Challenges
Investment scale: Estimates suggest R350–500 billion (USD 19–28 billion) is needed by 2035; current public financing is a fraction of that total.
Water scarcity: Electrolysis is water-intensive (~9 litres per kg), raising supply concerns in semi-arid regions.
Policy stability and bankability: Investors seek long-term clarity; most JET-IP funding is loan-based, not grants.
Long lead‑times for giga-scale projects and global market risk uncertainties.
Summary
South Africa is actively moving from roadmap to execution and is one of Africa’s most advanced green hydrogen markets. While still nascent, the sector is rapidly scaling through flagship projects, international finance, and industrial integration. If current plans hold, South Africa has the potential to become a top global hydrogen exporter by the early 2030s, leveraging its renewables, PGM advantage, and strategic port infrastructure.
Â
