Hydrogen is crucial for driving cleaner energy transitions and securing a sustainable future for coal — projected to account for about 14% of global energy demand by 2050.
Through advanced abatement technologies such as High-Efficiency Low Emissions (HELE) and Carbon Capture and Storage (CCS), coal can produce hydrogen while reducing CO₂ emissions by up to 90% — making it one of the lowest-carbon options for producing blue hydrogen.
Blue Hydrogen Production
Blue hydrogen is produced from coal through a four-stage process that combines gasification with carbon capture, delivering a low-emission hydrogen stream at commercially viable scale.
Gasification
Coal is reacted with oxygen and steam under high pressure and temperature to form synthesis gas — a mixture mainly composed of carbon monoxide and hydrogen.
Water-gas shift
The synthesis gas is purified to remove impurities, and then the carbon monoxide reacts with steam in a water-gas shift reaction to produce more hydrogen and carbon dioxide. At this stage it is called grey hydrogen.
Carbon capture
Hydrogen is separated from the gas mixture, and the concentrated carbon dioxide stream is captured and stored. This step reduces the carbon footprint of hydrogen production significantly.
Blue hydrogen
The resulting hydrogen is a clean energy source that can be used for transportation, electricity generation, industrial processes, and heating. This is called blue hydrogen.
Case
Studies.
Commercial-scale blue hydrogen projects are already operating across the Pacific — proving that coal-derived hydrogen is technically and economically viable today.
Hydrogen Energy Supply Chain (HESC)
The HESC Project is a joint venture between the Australian and Japanese governments based in Victoria, Australia. This pioneering project achieved a significant milestone by successfully extracting clean liquid hydrogen from Latrobe Valley coal and a biomass mix, and shipping it to Kobe, Japan.
The project produces about 225,000 tonnes of clean hydrogen annually while reducing CO₂ emissions by an impressive 1.8 million tonnes per year — equivalent to the emissions from approximately 250,000 petrol-driven cars.
Great Plains Synfuel Plant
The Great Plains Synfuel Plant in North Dakota has been operational since 2000. It utilises CCS technology to generate about 1,300 tonnes of hydrogen daily from brown coal gasification, producing hydrogen-rich synthesis gas.
The plant's advanced CCS system captures around 3 million tonnes of carbon emissions annually, transporting it to Saskatchewan, Canada, for enhanced oil recovery operations — demonstrating the commercial viability of coal-derived blue hydrogen at scale.
Looking
Ahead.
The momentum behind coal-to-hydrogen continues to grow as the world recognises the significant role of hydrogen in addressing climate goals. Abatement technologies and renewables enable the clean production of hydrogen, making it a versatile source for generating electricity, powering industries, and heating homes. By 2050, hydrogen demand is projected to increase by 160–570% compared to current levels.
Cost of Blue Hydrogen
In regions like China, costs can be as low as $1.6/kg — one of the most competitive clean hydrogen pathways globally.
Costs vary widely based on local electricity prices, technology, and storage. IEA and European Commission estimates place green hydrogen significantly higher than blue today.
According to some studies, the cost of green hydrogen could decrease to less than $1/kg by 2050 in regions with favourable conditions and supportive policies. For consistency, similar cost-reduction trends are likely to apply to coal-with-CCS hydrogen production as well.
The IEA reports that in 2021, around 70% of dedicated hydrogen production’s energy requirements were met with natural gas, and approximately 30% came from coal. China leads in global coal consumption for hydrogen production, accounting for 97% of this usage.
Hydrogen demand is projected to represent about 14% of the world’s total energy demand by 2050 — a 160–570% increase on current levels, creating a major long-term market for low-cost blue hydrogen from coal.