Goitsione Emily Olifant and Steven Matome Mathetsa, researchers at the African Energy Leadership Centre within the Wits Business School at the University of the Witwatersrand, conducted a rapid appraisal of scholarly and non-scholarly literature, government publications, and industry reports to map the environmental and socio-economic terrain of South Africa’s planned hydrogen economy. Their review, published on 14 January 2026, arrives at a moment when the country has already released three strategic documents—the Hydrogen Society Roadmap, the Green Hydrogen Commercialization Strategy, and the Just Energy Transition Implementation Plan spanning 2023 to 2027—signaling national intent to build a hydrogen economy from scratch. The question the researchers pose is whether the socio-economic and environmental implications of this ambition are genuinely understood before billions are committed.

The technical case for green hydrogen rests on electrolysis, a process that passes renewable electricity through water to split it into hydrogen and oxygen, emitting nothing but clean oxygen as a by-product. Three electrolyser technologies dominate the large-scale production landscape: proton exchange membrane units, prized for their compact size and wide power regulation range; alkaline electrolysers, valued for their technological maturity and long service life; and solid oxide electrolysers, which operate at very high temperatures. Anion exchange membrane variants remain in research and development. Once produced, hydrogen presents formidable storage challenges—it has a wide flammability range of 4 to 75 percent by volume, requires minimal ignition energy, and is prone to leakage—demanding compression, liquefaction, or conversion into carriers such as green ammonia, metal hydrides, or emerging liquid organic hydrogen carriers.

The environmental arithmetic is compelling. Conventional hydrogen production, dominated by natural gas reforming and coal gasification, generates an estimated 830 million tons of carbon dioxide annually, roughly 2.5 percent of global emissions. Green hydrogen, by contrast, carries a global warming potential of 1.0 to 5.1 kilograms of CO2 equivalent per kilogram of hydrogen, compared to 11 to 13 for gray hydrogen from natural gas reforming and 19 to 24 from coal gasification. Blue hydrogen, which pairs steam reforming with carbon capture and storage, achieves 0.60 to 4.7—comparable to green on paper, but highly dependent on the electricity mix powering the capture process. If the global green hydrogen market reaches the projected 600 million tons needed for climate neutrality by 2050, cumulative emissions could fall by up to 85 gigatons of CO2 equivalent, with industry and transport accounting for 42 and 36 percent of demand respectively.

For South Africa specifically, the decarbonization opportunity is concentrated in hard-to-abate sectors. Transport contributes around 10.8 percent of national greenhouse gas emissions, and fuel cell electric vehicles—projected to reach up to 25 percent of global land-based transport—offer a pathway to zero-emission mobility. Green hydrogen also serves as a strategic feedstock for ammonia, the second most widely produced chemical worldwide at approximately 230 million tons per annum, with roughly 80 percent of global output destined for fertilizer manufacturing. Beyond agriculture, hydrogen enables green steel synthesis, methanol production, and renewable energy storage to buffer the intermittency of solar and wind. The country’s renewable endowment is extraordinary: several regions receive over 2,500 hours of sunshine annually with average solar irradiation of 2,025 kWh per square meter per year, while coastal wind speeds of 6 meters per second could generate 60 terawatt-hours of wind energy annually.

The economic calculus, however, remains stubbornly unfavorable. Gray hydrogen costs approximately USD 1.66 to 1.84 per kilogram, while blue hydrogen runs USD 2.09 to 2.23. Green hydrogen, despite its environmental superiority, has been estimated as high as USD 10.30 per kilogram—roughly five times the conventional methods—though other sources place it between USD 3.6 and 5.8. Electrolyser capital costs compound the challenge: alkaline units run USD 500 to 1,400 per kilowatt, proton exchange membrane systems USD 1,100 to 1,800, and solid oxide variants up to USD 6,000. In developing economies like South Africa, where domestic manufacturing infrastructure, specialized expertise, and technology licenses are absent, production costs balloon further with shipping, customs duties, and installation labor. The researchers emphasize that comprehensive feasibility and techno-economic assessments are essential before South Africa commits to production targets of 500,000 tons and 16.6 gigawatts of capacity by 2030.

Yet the country holds a trump card that few nations possess: over 90 percent of the world’s platinum group metals reserves. Approximately 10.9 tons of iridium and 4.0 tons of platinum are needed to produce 10.9 gigawatts of electrolysers by 2030, requirements forecast to fall to 3.8 and 1.3 tons respectively by 2040 as cumulative installations grow. South Africa could export these critical minerals while simultaneously building a domestic hydrogen economy, capturing value at both ends of the supply chain. Strategic partnerships with European Union nations are already in place, and the global export market is projected to reach USD 300 billion annually by 2050, with demand skyrocketing from 87 million metric tons in 2020 to between 500 and 680 million metric tons by mid-century. Germany alone anticipates annual demand of 90 to 100 terawatt-hours and plans to supplement domestic production with imports, while Chile targets 25 gigawatts of capacity by 2030.

The social dimension may prove the most treacherous. South Africa’s youth unemployment stood at 45.5 percent and the national average at 33.2 percent in the second quarter of 2025, and the review estimates that approximately 650,000 jobs could be created across the hydrogen value chain by 2050. But forecasting green jobs is fraught with difficulty: occupational classifications remain unstandardized, projections amalgamate short-, medium-, and long-term data with varying skill requirements, and countries like China are better positioned to generate manufacturing employment while South Africa would likely import hydrogen technologies. Public skepticism compounds the challenge—rooted in the Department of Energy and Electricity’s history of infrastructure deterioration, escalating tariffs, and prolonged power cuts. Resistance to hydrogen adoption has been amplified by the introduction of fuel cell electric vehicles and refueling stations, as citizens question the future of the fossil fuel-based mobility sector and the high cost of FCEVs. Inadequate public engagement could trigger social unrest, project abandonment, and infrastructure vandalism.

The water question looms largest. Producing one kilogram of green hydrogen consumes approximately 9 kilograms of purified freshwater, and achieving a globally mature hydrogen economy would require roughly 34,500 gigalitres of water annually. South Africa receives less than 50 percent of the global average rainfall, and future climate projections indicate rainfall will decrease further without carbon mitigation. The country shares four internationally managed river basins—the Orange, Inkomati, Limpopo, and Maputo—that contribute 45 percent of total river flow and must be fairly divided with neighboring countries facing their own water stress. Desalination of seawater or brackish water appears technically feasible, requiring between 60 and 95 kilograms of seawater per kilogram of hydrogen, but the energy demand for desalination—estimated between 55 and 70 kWh per kilogram of hydrogen—remains a critical consideration. The researchers call for detailed studies on water availability, low-cost water production systems for coastal hydrogen production, and socially inclusive programs that generate employment for local communities.

The policy landscape provides a foundation but not a blueprint. The National Environmental Management Act of 1998, with its precautionary and polluter-pays principles, requires environmental authorization for large projects, yet gaps persist regarding hydrogen’s water use, biodiversity trade-offs, and infrastructure development in vulnerable areas. The Climate Change Act 22 of 2024 legislates emission reduction commitments and carbon budgets but does not explicitly link environmental mechanisms to hydrogen production pathways. Lessons from abroad are instructive: China’s Hydrogen Industry Development Plan targets 100,000 to 200,000 tons of annual production by 2025 with 50,000 fuel cell vehicles; Australia’s National Hydrogen Strategy emphasizes workforce development and cost reduction; and the European Union’s Hydrogen Strategy for a Climate-Neutral Europe prioritizes investment support, market development, and international cooperation with the African Union. What South Africa lacks is hydrogen-specific legislation with the enforceability of strong and binding laws—covering incentives, the energy-water nexus, and licensing for technology manufacturing. The researchers conclude that without coherent policy frameworks, substantial infrastructure investment, and genuine community participation in decision-making, the hydrogen economy risks becoming another promise made to marginalized communities rather than a pathway to shared prosperity.

Subject of Research: Green Hydrogen

Article Title: Assessing the environmental and socio-economic challenges and opportunities for the green hydrogen economy in South Africa

Article References: Olifant, G. E., & Mathetsa, S. M. (2026). Assessing the environmental and socio-economic challenges and opportunities for the green hydrogen economy in South Africa. Frontiers in Sustainable Energy Policy, 4, Article 1716406. https://doi.org/10.3389/fsuep.2025.1716406

Image Credits: AI Generated

DOI: 10.3389/fsuep.2025.1716406

Keywords: green hydrogen, South Africa, energy transition, water scarcity, electrolysis, just energy transition, platinum group metals, renewable energy, Assessing, environmental, socio-economic, challenges