"Almost no company that decided to make large-scale investments in hydrogen based on confidence in the policy will of the Moon Jae-in administration is actually making money now. Korea's hydrogen technology competitiveness continues to lag behind major global countries. Yet, the government remains indifferent throughout. This is not a plea for unconditional support such as subsidies. We simply ask for the demonstration of policy will and a clear direction."
A domestic hydrogen technology expert stated that the first reason for the sluggish growth of Korea's hydrogen industry is government indifference, citing the 'part-time operation' of the Hydrogen Economy Committee as a typical example of this reality. He pointed out that hydrogen, like other early-stage industries, relies heavily on policy, and since the government has effectively cut off interest for several years, corporate momentum to advance projects has waned.
The government officially began fostering the hydrogen industry in 2018. At that time, the government selected the hydrogen economy as one of three strategic investment areas in its 'Innovative Growth Strategic Investment Direction' and released the 'Hydrogen Economy Activation Roadmap' the following year. In this roadmap, the government pledged to build an industrial ecosystem capable of leading the hydrogen economy with hydrogen vehicles and fuel cells as two major pillars.
In 2020, the National Assembly enacted the world's first Hydrogen Law (Act on the Promotion of the Hydrogen Economy and Safety Management of Hydrogen), accelerating the project further. In 2021, then-President Moon Jae-in emphasized that "the transition from a carbon economy to a hydrogen economy is an unstoppable trend directly linked to future national competitiveness" and stated, "We will gather all national capabilities to lead the hydrogen economy." Later that year, the government released the 'Basic Plan for Hydrogen Economy Implementation,' the first statutory plan based on the Hydrogen Law. In this process, five companies—SK, Hyundai Motor, POSCO, Hanwha, and Hyosung—declared they would invest a total of 43.4 trillion won in the hydrogen sector by 2030.
However, 2021 was the last time the government presented a blueprint for the hydrogen industry. Despite two regime changes since then, no administration has reviewed or supplemented the previous policies to release an 'upgraded' plan. The industry expected that President Lee Jae-myung's administration, which has emphasized the importance of clean energy, would reinvigorate the hydrogen industry, but the result was exactly the opposite. The Hydrogen Economy Committee, which had at least maintained some function under the previous government, has effectively ceased operations in this current administration.
The private sector has been directly hit. Lacking economic viability due to insufficient policy support, the hydrogen industry has been on a downward trend for several years. While major conglomerates continue investing by looking toward the 'future,' mid-sized and SMEs (small and medium-sized enterprises) with insufficient financial resources are withdrawing from the business.
The industry worries that if government indifference continues, Korea will fall significantly behind in competitiveness compared to major countries like the United States, China, and Japan, which are actively fostering their domestic hydrogen industries through policy. There are calls for the government to show interest in the hydrogen industry now and develop realistic policies.
Representatively, there is a growing voice that the government should consider activating the production of 'gray hydrogen,' made using fossil fuels, since 'green hydrogen,' produced by splitting water with electricity generated from renewable energy, has a production cost that is too high for widespread use. There are also opinions that tax benefits should be maintained and expanded to promote the adoption of hydrogen vehicles. Previously, the government announced it would reduce the cap on the individual consumption tax exemption for hydrogen vehicles from the current maximum of 4 million won to 3 million won next year and to 1.5 million won in 2028.
Some argue that the government should actively utilize hydrogen in its flagship 'three mega-projects': semiconductors, physical AI (artificial intelligence), and AI data centers. This is based on the need for a 'complementary system' that produces hydrogen using surplus electricity to compensate for the seasonal variability of renewable energy, stores it for long periods, and converts it back into electricity when needed.
in INDUSTRY
