Hydrogen projects, which are largely in pilot phases in the Middle East, will be scaled up to become fully commercial in seven years as the clean fuel becomes more economical to produce, according to an executive board member at Siemens Energy.
"There's a lot of investment going into the direction. Here in the region, there are already investments going into pilot installations. Perhaps the next installation then is going to be an installation which is going to be 10 per cent bigger. Perhaps already has a kind of semi-commercial character," said Jochen Eickholt, executive board member at Siemens Energy.
"And then the next generation will have a completely commercial character that will happen over the next five or seven years."
The German company, which was spun off from industrial conglomerate Siemens last year, is developing a Dh50 million hydrogen pilot project with Dubai Electricity and Water Authority (Dewa).
The 300-kilowatt green hydrogen plant is being developed at the Mohammed bin Rashid Al Maktoum Solar Park, the site of the UAE's biggest solar plant.
The pilot project being developed by Dewa, Expo 2020 and Siemens Energy aims to demonstrate how hydrogen can be produced from solar power and how to store and re-electrify the clean fuel.
Hydrogen is on track to become a multibillion-dollar industry in the Middle East, with total announced investments set to hit $44 billion, according to Platts' estimates. About $35bn of the commitments will be in projects that will become operational by 2030.
Green hydrogen, which Siemens Energy is producing in the Middle East, is manufactured from electrolysis, which involves splitting water molecules into hydrogen and oxygen, using renewable energy.
The German company is also exploring opportunities in Egypt, where it is developing a hydrogen hub as a viable producer of green hydrogen.
"In Egypt, we're thinking of a pilot or prototyping installation as well in the range of 100 megawatts," said Mr Eickholt.
"The first functioning electrolyser [in the region is with] Dewa. In Abu Dhabi, where [we're partnering] for instance, with Masdar we're developing e-fuels."
In Abu Dhabi, Masdar has already begun an assessment of its green hydrogen demonstrator project, which will find uses for fuel cells in buses at Masdar City as well as in aviation fuel to be used by Etihad and Lufthansa.
A second phase of the project will look into extending the use of the fuel in the maritime and shipping sectors.