CEWT Position Paper: Hydrogen Deployment Vs Defossilisation

CEWT Position Paper Hydrogen: Deployment vs Defossilisation Executive Summary Hydrogen is transitioning from ambition to implementation. Electrolyser factories are scaling, projects are reaching financial close, and regulatory frameworks are being finalized across multiple jurisdictions. However, deployment alone does not guarantee systemic transformation. The decisive question is whether hydrogen accelerates defossilisation or merely coexists with fossil expansion. 1. Deployment Is Not Transformation Hydrogen projects can be technically successful while leaving fossil extraction unchanged. If hydrogen production or end-use applications extend the life of fossil infrastructure, the system impact remains limited. Defossilisation requires measurable reduction in geological carbon extraction — not simply the addition of alternative energy pathways. 2. Three Hydrogen Pathways Hydrogen can function in three fundamentally different roles: • Fossil Extender – Produced from fossil gas or used to optimize existing fossil value chains without reducing extraction. • Transitional Molecule – Used in early decarbonisation efforts but without structural fossil phase-down. • Defossilisation Enabler – Produced from renewable electricity and deployed to replace fossil feedstocks and fuels in hard-to-abate sectors. Only the third pathway delivers structural transformation. 3. The System Integrity Test For hydrogen to support defossilisation, projects must demonstrate: • Renewable-based production with low lifecycle emissions. • Replacement of fossil feedstock or fuel rather than parallel deployment. • Transparent accounting of fossil displacement. • Alignment with national and international fossil phase-down strategies. Without these conditions, hydrogen risks becoming an additional energy layer rather than a substitute. 4. Capital Allocation and Strategic Impact Hydrogen deployment mobilizes significant capital. The direction of this capital determines system outcomes. If investment reduces fossil dependency, hydrogen enhances energy sovereignty, stabilizes long-term pricing, and strengthens industrial competitiveness. If investment allows fossil expansion to continue, climate and financial risks remain embedded in the system. Conclusion Hydrogen deployment is accelerating globally. The strategic challenge is to ensure that this deployment translates into measurable fossil decline. Hydrogen becomes transformative when it replaces geological carbon inputs, not when it operates alongside them. Defossilisation is the structural benchmark by which the hydrogen strategy must be evaluated.