Audio und werbung/Shutterstock Save for later Print Download Share LinkedIn Twitter Developing and scaling up green hydrogen in the Middle East and North Africa (MENA) region will not come without a host of challenges for countries and companies alike, as each state moves ahead with its goal to become a major supplier of the green molecule. Renewable energy developers at the World Hydrogen MENA conference in Dubai last week identified top challenges the region — and they, as companies — are facing in the race for hydrogen development, notably the need for more offtake commitments.Offtake 'Chicken and Egg' DilemmaDeveloping a hydrogen economy and expanding its production requires real offtake. And the market is still behind in demonstrating tangible demand for green hydrogen. The hype around hydrogen projects is not helping — and can sometimes be harmful. “There is too much hype in the market but very few real actual projects that can really move forward, and this is disrupting the market," Global Head of Power to X at Scatec, Mohamed Amer, told panelists. He said there isn’t enough offtake and also emphasized that electrolyzer technology is not maturing enough. “This hype is putting pressure on prices, and nobody is willing to write offtake," he said.Amer believes the complexity of green hydrogen projects in MENA are underestimated, as relying on wind and solar power is not enough, and substantial investment will be needed to strengthen the grid. And even with an offtake, the entire value chain has to be green, which comes with its own set of challenges. “I am very skeptical about all these projects announced and I believe very few will really take off," Amer added.Echoing Amer’s skepticism was Luc Koechlin, Middle East CEO at French utility EDF. Likening the offtake issue to a chicken and egg conundrum, Koechlin said there is a lot of noise around hydrogen announcements but offtakers need a “huge project to confirm that cost of hydrogen will decrease.”Offtake is far from the only obstable. Koechlin and Amer also agree that infrastructure is an issue. “Countries in the region need massive amount of capital to upgrade infrastructure," Amer said. Amer also believes countries in the MENA region need to face the challenge of ammonia being a global commodity that they won’t use domestically. “Some governments don’t see the value or what’s in it for them," he said, but also warning that governments are often hesitant to support a product exclusively produced for exports to places like Europe, where regulations are also challenging.Regulation ProblemsWhether prominent or almost non-existent, regulation has emerged as a major barrier for the development of a green hydrogen market. Having mature and unified policies will certainly help the region develop a green hydrogen economy and unify its grid. This would, in turn, allow developers to expand the molecule’s production. “As a developer, we will have to select the project and country depending on the maturity of regulation and environment, and this will be a challenge for each country," Koechlin said.A related issue is dealing with different regulations in different potential markets. “When selling a product to Europe, you have to abide by certain regulation, while for markets such as Japan or South Korea, it is entirely different," Amer said. Neom Green Hydrogen Company CEO David Edmondson agrees that legislation in Europe has made things problematic for producers. "The problem with Europe's legislation is they are making it difficult for exporting countries to sell their hydrogen to the European market," Edmondson said.Regional competition may be playing against MENA countries' interest, and EDF’s Koechlin sees potential for collaboration. “I don’t see a lot of cooperation between countries for now, and there is certainly potential to work together to create this regional hydrogen," he said. Koechlin believes challenges are different for each country in the region, but the common thread is the need for regulation and maintaining competitiveness. “Generally speaking, there is competition in the region between Saudi Arabia, the United Arab Emirates, Oman, Egypt, Morocco and Algeria."The lack of human capital is also problematic, as countries are also competing for it. “There is huge competition for developers and human resources," Koechlin said. This was echoed by Edmondson, who stressed the need for the region to build up skilled professionals. “There is an obligation on investors to develop courses," he said, giving the example of Acwa Power sponsoring colleges in Saudi Arabia.