Stakeholders of green hydrogen are the group of people that have interest in the company and the outcome of its operations. The interest goes beyond the monetary aspect and engages in many more areas such as community contributions and ethics.
The goal of the stakeholder’s analysis is to identify the main stakeholders of the company and eventually determine the level of interest and influence of each one of them on the company. This concept is visualized in the stakeholder’s matrix. To conclude, two main groups of stakeholders classified as internal and external.
Stakeholders can group in external and internal stakeholders. Internal stakeholders are the ones who work directly for the company or are part of the organization. External stakeholders, though, are the ones that are in the value chain of the company, for instance, suppliers, customers and local communities.
This blog post includes the main stakeholders and their relationship with the company and its influence on the company’s operations.
Green Hydrogen Internal Stakeholders
Internal stakeholders for green hydrogen is every business, company owner, shareholders, investor government and employees that are directly involved with the operational and financial processes of producing green hydrogen. Not only do these stakeholders have a financial interest, but also a moral responsibility to help uphold the climate of goals of the world.
As this is an emerging market and a highly globally important one, interests for internal stakeholders are rather high except for the employees. Employees (usually but not all) just want to get paid to feed their families and pay their bills, they just do what they are told and their interests are usually selfish in most cases but are essential to carrying out tasks (Lumen, n.d.). Exception for employees can be usually engineers that have a deep passion for their craft and are deeply involved with the hydrogen projects.
Investors, shareholders and governments have the highest power as they can control which projects are worth investing in or not, if a project doesn’t receive sufficient funding, it cannot be realised. These stakeholders are required to remain satisfied as they are the fuel of the green hydrogen projects until they receive enough popularity on their own due to great products and services, then these projects and companies would be able to fund themselves.
Green Hydrogen External Stakeholders
The producers of energy have a high interest in hydrogen, governments and the European Commission are increasing the CO2 prices continuously, as mentioned in the PESTEL analysis. This forces the companies to examine alternatives energy sources for the energy generation.
An article (Widera, 2019) states that hydrogen can convert the unreliable energy supply from renewable energy sources into a reliable one. The energy producers have a lot of power as well. Despite the increasing demand for renewable energy, energy producers remain powerful in terms of the decisions that have to be made regarding the source of humanities energy consumption.
The companies that utilize the generated energy have little power and low interest in hydrogen as an energy source. The reason for this is that the companies are the end consumers of the energy, therefore they are greatly dependant on the supplier and regulations that the suppliers are required to adhere to. It is difficult for the energy-consuming companies to create an infrastructure wherein they generate their energy, as it is a greatly costly matter.
Besides the legal restrictions, vehicle manufactures have much interest in hydrogen energy. The reason for this is that humanity is depleting the Earth’s fossil fuels. The global oil reserve will deplete in approximately 30 years. Gas reserves will be drained in 50 years and the coal reserve of the world will be depleted in 90 years (Kuo, 2019). Currently, vehicle manufacturers have much power as they produce vehicles with fuel systems as they see fit. However, when the time comes, the transition from fossil fuels to renewable energy sources must have occurred and the vehicle manufacturers are aware of this. Hydrogen vehicles are already in development, but the issue of efficiency remains. It is proven that electric vehicles are superior compared to hydrogen cars in terms of efficiency. Electric vehicles have an efficiency rate of 95%, whereas hydrogen cars are 38% efficient (Baxter, 2020). Nevertheless, hydrogen would be a competitive fuel base for heavy-duty vehicles, such as trucks and buses. The reason for this is the rapid refuelling time of hydrogen in comparison to the electric vehicle. Moreover, a truck has more space for a large hydrogen system than a regular car. Additionally, the high energy density of hydrogen is suitable for heavy-goods transport vehicles (Howden, n.d.).
The world’s governments has a high interest in the technology of hydrogen-based energy. The goal to reduce GHG dramatically, the 30% to 50% of energy usage possibly originating from hydrogen, and the elimination of natural gas exploitation in in the world.
Similarly to different world’s governments, the European Commission has a high interest in hydrogen. The reasons for this are already covered in the PESTEL analysis, namely, it desires a carbon-free European Union by the year 2050 (European Commission). Herein, the energy generation through hydrogen is a crucial energy source for the decarbonization of transport, industry, and buildings (FCH JU, 2019). The power of the European Commission is on a medium level as well, as mentioned in the PESTEL analysis.
The large fossil fuel companies have been lobbying heavily in the European Union for an extensive period. Since 2010, the five largest companies have lobbied with more than 250 million euros (Laville, 2019).
Institutional investors have the potential to have much power and a high interest in the developments of hydrogen. Nevertheless, according to (Kaminker and Stewart, 2012), there is a limited amount of investors. The reason for this is the uncertainty that is facilitated by the problems in the infrastructure and clean energy investments. Examples of these problems are the lack of investor capability and understanding, the regulatory barriers, the unsupportive environmental policy, and the policy risk derived from regulatory uncertainty. Therefore, the low amount of institutional investors leaves them with little power and low interest in the matter.
Internal stakeholders for a green hydrogen company can be seen the same as any other company. This group is subdivided between the employees and the investors. The influence of both subgroups is high since they are the ones that are actualizing the operation of the company. Each group is breaking into smaller groups to give more insight into the character of each one of them.
External stakeholders on the other hand are more specific and since the green hydrogen industry is evolving there will be new stakeholders each day. But for now, the main stakeholders in broader view for green hydrogen are the energy organizations and car producers that both have low interest and influence on the market. Though, it could change if there are new circumstances.