PHOTO
The Middle East’s path toward decarbonisation - spanning low-carbon hydrogen, Carbon capture, Utilisation, and Storage (CCUS), and energy storage - will be determined by cost, technology readiness, and policy direction, a top regional energy expert said.
Dr. Steven Griffiths, Professor and Vice Chancellor for Research at the American University of Sharjah (AUS) told Zawya Projects that deployment and demonstration are happening simultaneously across all three technology areas, noting that each encompasses multiple pathways with varying levels of maturity.
Energy storage displays the widest range in technology maturity, Griffiths said.
“Lithium-ion batteries are deployment-ready for short-duration applications,” he said. “For long-duration storage, critical for solar-heavy grids, sodium-based batteries and flow batteries are entering commercial deployment, with projects now operating at utility scale.”
He added that mechanical systems like advanced compressed-air and liquid-air storage are transitioning from demonstration to early commercial phase, while thermal energy storage using molten salts is also advancing toward deployment for the longest-duration applications.
In the realm of low-carbon hydrogen, Griffiths said the region is well positioned for both blue and green hydrogen, but cost advantages currently favour blue hydrogen due to abundant natural gas and expanding carbon capture and storage (CCS) infrastructure.
“Blue hydrogen, produced via steam methane reforming coupled with carbon capture, is the current cost leader for low-carbon hydrogen deployment here in the Gulf,” he said. “Green hydrogen from renewable electricity is advancing rapidly given our exceptional solar resources, though costs need to continue declining for widespread deployment.”
When it comes to carbon capture, amine-based solvent systems are deployment-ready for point-source industrial applications.
“These incumbent technologies capture CO2 at 2 to 3 gigajoules per tonne, and we're seeing commercial-scale projects moving forward regionally,” he said. “However, innovation continues - solid sorbents operating at lower temperatures show promise for 2025-2030 deployment, potentially reducing energy consumption to 1-2 gigajoules per tonne.”
Direct Air Capture (DAC), Griffiths continued, remains largely in the demonstration phase, though emerging technologies like electro-swing adsorption offer “intriguing possibilities” for the 2030-2040 timeframe.
Overall, the region is well-positioned to commercialise decarbonisation technologies, according Griffiths.
“Our region has the advantage of strong policy support, available capital, and industrial anchor loads that can accelerate the commercialisation pathway from demonstration to deployment,” he stated.
Excerpts from the interview:
How do you see the balance between blue and green hydrogen evolving in MENA given gas endowment and export ambitions?
The MENA region is uniquely positioned to pursue a balanced blue and green hydrogen strategy. We have abundant natural gas resources, exceptional solar potential with the UAE achieving some of the world's lowest solar PV tariffs, and growing wind resources. We've also established carbon capture infrastructure and expertise.
The economic reality today is that blue hydrogen offers near-term competitive advantage. With our existing CCUS capabilities - like ADNOC's Al Reyadah facility - and abundant low-cost natural gas, we can produce blue hydrogen at approximately $1.50 per kilogramme. Green hydrogen currently costs $4 to $10 per kilogramme in most locations, making blue hydrogen significantly more cost-competitive, at least in the near-term.
This is why the UAE National Hydrogen Strategy, the development of which I supported, takes a practical, phased approach. At the time of the strategy development, we had targeted, by 2031, about 0.4 million tonnes per annum of blue hydrogen alongside 0.5 million tonnes of domestically-produced green hydrogen. While these numbers may change, blue hydrogen still is planned to serve as the bridge - allowing us to establish infrastructure, develop markets, and build scale while green hydrogen costs continue to decline.
But we’re not stopping there. Looking toward 2050, the strategy suggests an equal share between blue and green hydrogen - each representing about 41 percent of production. This balanced portfolio would allow us to leverage our competitive advantages across the full spectrum - our hydrocarbon resources and CCUS expertise for blue, and our considerable solar resources for green.
It’s not either/or; it's a strategic sequence that maximses our strengths while building toward a diversified, low-carbon hydrogen rollout.
In the policy arena, what are the most effective mechanisms governments can use to de-risk industrial decarbonisation investments while attracting private capital?
The most important consideration is establishing secure offtake, particularly for first-of-a-kind (FOAK) technologies. FOAK projects face significant financing challenges - they typically achieve loan-to-value ratios of only 20-60 percent compared to 80 percent for mature technologies like solar, and require debt service coverage ratios of 2.0x or even higher. Secure demand is essential to attract this lower-cost debt financing needed to build technologies at scale.
Therefore, demand-side policy measures are the most important consideration. The most effective mechanisms vary by technology, but several stand out. Mandates and standards work exceptionally well. We've seen this with SAF [Sustainable Aviation Fuel] blending mandates in the EU under ReFuelEU and transportation fuel standard programmes.
For materials like cement and steel, embodied carbon limits create differentiated markets for low-carbon products while maintaining long-term stability over 20-30 years. Government procurement is particularly useful for cement and steel, given that public procurement accounts for 40-60 percent of concrete demand and approximately 25 percent of steel demand.
Government-backed financing instruments including loan guarantees, low-interest loans (through institutions like the European Investment Bank and the Loan Programmes Office (LPO) of the U.S. Department of Energy) and loan insurance effectively bridge the financing gap. These instruments have proven essential in recent FOAK projects.
Government-backed financing agencies have dominated the project lending space because few private banks have the appetite or technical capability for the extensive diligence these projects require.
State-backed intermediaries like H2Global [in Germany] also show promise by absorbing cost and risk while providing long-term offtake certainty to producers.
The key is combining these mechanisms. Secure demand signals through mandates or procurement unlock the private capital that can flow through government-backed financing instruments.
How can governments and academia better align R&D funding and policy frameworks to accelerate technology deployment while ensuring commercial viability?
The acceleration of technology deployment requires a shift from traditional R&D to a comprehensive RDD&D approach, which is Research, Development, Demonstration, and Deployment. This framework recognises the four distinct phases that clean energy technologies must navigate on their path to commercialisation.
Industry should lead demonstration and deployment, particularly for technologies already at commercial scale. However, for first-of-a-kind technologies, success depends on what we call Adoption Readiness, which extends beyond technology readiness.
The U.S. DOE’s Adoption Readiness Level framework, for example, assesses 17 factors across four key dimensions:
Value Proposition – delivered cost competitiveness and functional performance
Market Acceptance – demand maturity and market openness
Resource Maturity – capital flow and workforce capabilities
License to Operate – regulatory environment and policy support
These non-technical barriers often present greater challenges than the technology itself.
Universities and research institutes must focus on R&D that aligns with industry roadmaps. Early-stage research should target novel technologies with longer development horizons, avoiding redundancy with technologies already well-advanced and nearing deployment.
Government plays three key roles: First, supporting industry-university collaboration through targeted funding mechanisms. Second, steering fundamental research toward priority areas identified by industry needs. Third, providing policy frameworks that address the full innovation continuum – including not just supply-side support, but also demand stimulation policies and critical enablers like standards, certification, and infrastructure planning.
The key is ensuring strong alignment through strategic government funding of university-industry collaborations in priority areas, creating the ecosystem conditions for technologies to progress efficiently from research through deployment.
(Reporting by Anoop Menon; Editing by SA Kader)
Subscribe to our Projects' PULSE newsletter that brings you trustworthy news, updates and insights on project activities, developments, and partnerships across sectors in the Middle East and Africa.
