Hydrogen is a fast growth sector, because of its critical role in the energy transition. David Willans shares three insights from our recent work in this highly technical sector.
Over the last year, we’ve worked on several hydrogen projects, from a behemoth investing billions into hydrogen production to a sparkling new venture building regional infrastructure for hydrogen-powered heavy transport.
We’ve learned a lot along the way, both from our own research and that of others like the European Investment Bank, the Hydrogen Council and many more. Three big insights stand out. By sharing them, we hope they’ll help other communicators to scale green and low-carbon hydrogen too. Ultimately, that’s good for everyone.
First, a bit of context. Green (and blue) hydrogen has properties that give it huge potential in decarbonising ‘hard-to-abate’ sectors: mostly heavy industries that use fossil fuels to achieve high temperatures, for chemical feedstocks, and for moving heavy cargo and freight. They produce about 30% of annual carbon emissions. Hence, why hydrogen is moving fast. As of May 2022, 680 large-scale hydrogen project proposals, worth $240bn of direct investment through to 2030, had been announced globally – up 50% from November 2021. Policymakers are scrambling to put regulation in place; investors are diving in; established industrial players are engaging; and innovative SMEs are springing up worldwide. This cacophony of activity leads to the first insight.
#1 Enormity and scale are the enemies of action (or Final Investment Decisions)
Hydrogen veteran Pierre-Étienne Franc, who recently raised $2bn for his investment fund, said it’s a ‘chicken and egg’ problem. The whole ecosystem needs to be created – supply and demand – at the same time.
The biggest thing holding hydrogen back is decision making. Of the $240bn worth of announced projects, only 10% have reached Final Investment Decision (FID) according to the Hydrogen Council. That reflects decision-maker uncertainty amongst investors, buyers, partners and policymakers. Why does that matter for communicators? Because decisions get made from a place of confidence. And confidence comes from clarity, in this case, around the specific role a business or technology plays in the broader ecosystem.
This information tends to be communicated through simple infographics showing, say, a transport corridor. But many we’ve seen miss the steps between their solution and the low-carbon transition – and therefore lack meaning and impact. For example, if it’s transport tech, how many trucks and trips are we talking? What will be impact on the air quality? How about fossil fuel savings? How might the economics play out over time? Just focusing in on one part of the ecosystem and relying on ‘the transition’ to encapsulate everything else isn’t enough.
#2 Technicalities matter and need translating
Communicating the technicalities of hydrogen solutions is essential, but unfortunately this makes up the mainstay of most communications (probably because most leaders in the space have technical backgrounds).
It’s like comparing TVs purely on refresh rates, decibel outputs and audio and image-enhancing software. A small group of techies understand, but the rest of us need more. We need to see the TV set in situ, graphics about how the sound travels, comparisons and reviews. We need technicalities translated, made tangible and compared to things we already understand.
Unlike TVs, where the category is already established and has clear consideration factors like image quality, hydrogen technology is a more open space, depending on the specific technologies. That means comparisons to showcase the benefits of the technology can be broader, but also that they must be based on the ‘jobs to be done’ (a phrase coined by Clayton M. Christensen in his famous paper by the same name) by the audience. For example, if we’re talking about localised solar-powered electrolysers in ports, the alternative choices may be biofuels, so potential factors to highlight are transport, storage and volatility of supply and price. But which is most relevant for policymakers? Investors? Customer decision-makers? Each has their own set of jobs they’re trying to do. Understanding these is key to translating technicalities into clear, relevant benefits.
#3 It’s David vs. Goliath
The big companies going into hydrogen, the Goliaths, have the luxury of leveraging their existing brand equity to compete for customers, partners, talent and to get policy makers on side.
Davids, the new players, don’t have this luxury. At some point, they will hit roadblocks that a well-crafted brand, narrative and messaging would help to avoid, whether it’s struggling to attract talent or not getting invited to sit at the policy tables. Brand and reputation are investments that compound over time, so it’s better to start sooner rather than later.
A word of caution with this type of work. The brand’s job is to associate the business with a core idea in the minds of the audience. The core idea is best defined as the overlap between what makes you different and what’s important to your audience. For Audi it’s technical excellence, for Tesla it’s modern status, for Volvo it’s safety. These ideas are all different. In markets where sustainability is very important, like hydrogen, it’s common to see businesses building their brands around the same core idea of contributing to, accelerating, or enabling the transition. While this is an important part of your business’s story, it is not helpful from a branding perspective, because it doesn’t differentiate. Your brand is not your ‘why’. Your ‘why’ is part of the puzzle, but if it doesn’t differentiate, then it’s not the best foundation to build your brand on.
Underpinning these three insights is one truth: attention is finite. The low-carbon transition is doing the job of drawing attention to hydrogen. But the research we’ve seen shows that more could be made of it. Which when you consider hydrogen’s abundance, is a bit ironic.
If you would like to speak to someone at Bladonmore about making your hydrogen communications more effective, please get in touch.