Business
H2 Vert: Production Costs, R&D… Morocco’s Battleground
The challenge in this field is not only to produce at low cost, but to master the production process. While Morocco already has a head start in renewables and desalination, it has also been engaged in electrolysis technologies from an early stage.
Where exactly are we in establishing the H2V ecosystem? It must be said that Morocco is among the first countries to have taken an interest in this field. That is a fact. And today, eight projects are already underway, with two at a very advanced stage.
On one hand, the Chbika project, which plans for 1 GW of installed renewable energy capacity and an annual production of nearly 200,000 tonnes of green ammonia for export, primarily to the European market.
On the other, the two projects initiated by OCP. Developed by HydroJeel, a subsidiary of InnovX (UM6P) for the OCP group, the project based in Jorf Lasfar (Jorf Hydrogen Platform) aims to achieve a production of 100,000 tonnes of green ammonia per year by 2026. It targets a production of 1 million tonnes of green ammonia by 2027 and 3 million by 2032.
The group has also entered into a joint venture with the Australian Fortescue Ltd to “supply green hydrogen, green ammonia, and green fertilizers to Morocco, Europe, and international markets,” as emphasized by the group at the time of signing this alliance in April 2024. OCP is also deploying, with Engie, one of the six projects currently being tracked by the Steering Committee.
In parallel, two other projects have been announced and presented as highly advanced, particularly in terms of studies. These include the NexTerra project, which will be developed by the German company Möhring Energie in strategic partnership with Moroccan stakeholders in Tarfaya, with a final electrolysis capacity (modular multi-stage system) of 10 GW.
The project will operate with nearly 20 GW of installed solar and wind energy capacity for the synthesis of ammonia and methanol destined for the European market. The second project, announced in February by H2 Global Energy, a Dubai-based company that has just completed the finalization phase of preliminary studies, aims for an annual production of one million tonnes of green ammonia.
Cost Control
We are facing a diversity of players from four continents, in addition to Australia if we count the OCP-Fortescue project, projects distributed across the three regions of the Sahara, and varied technologies in terms of electrolyzers. The projects obviously encompass the entire value chain, from upstream renewable energy production to export or local valorization, including seawater desalination.
A solid platform, guaranteed investments, a reachable demand market—the EU in particular—and rich, varied data. This is likely to encourage, and already is, new investors.
Nevertheless, two factors remain that constitute the true challenge for the green H2 ecosystem in Morocco: cost control and access to electrolyzers. This is undoubtedly why Morocco embarked very early on research and development (R&D), which is an important link in the value chain that ultimately helps reduce production costs.
Cost is undoubtedly one of the factors directly influencing Morocco’s choice. The production costs of fuels, whether methanol, kerosene, or fuel oil, are uncompetitive.
This is why the Kingdom is opting, initially, for ammonia, which will also meet a national need in the fertilizer industry. However, today, the most recent studies show that gray ammonia, produced from natural gas, costs about $500 per tonne.
“The latest projections for green ammonia are around $600 per tonne, as illustrated by a project recently selected in India,” observes Badr Ikken, a consultant and expert in the field, in one of his recent media appearances. “The economic gap is therefore small and makes substitution credible in the medium term,” notes the expert.
Synthetic kerosene, on the other hand, currently exceeds $2,000 per tonne, compared to about $700 for fossil kerosene. Other studies show that in the project developed by Spain (2 GW), the production cost of green ammonia is between 500 and 600 euros per tonne.
The NEOM project (Saudi Arabia, 2 GW) brings this range down to 370/460 euros per tonne. Morocco should at least be within this range to make its projects profitable, while also counting on the proximity factor with the target market.
Pilot Projects
Of course, logically, production costs are expected to decrease further as technology advances, whether in terms of renewable energy production or electrolysis. And this is where R&D fully plays its role. At this level, the Kingdom already has several programs underway or at an advanced research stage.
The OCP group has also allied with the American startup Peregrine Hydrogen to deploy a technology for the co-production of green hydrogen and sulfuric acid. This innovation, integrated directly into the fertilizer sector, aims to reduce costs, limit CO₂ emissions, and position the Kingdom as a major player in clean hydrogen.
Similarly, the Moroccan company Gaia Energy partnered with the Israeli group H2PRO, signing a strategic agreement in November 2022 to implement a pilot project in Morocco to produce green H2 and green ammonia. The agreement also includes the establishment of a gigafactory for electrolyzers in Morocco, along with technology transfer.
In May 2025, the Swedish company Metacon formalized the award of a contract for the installation of a pilot electrolysis unit in Morocco. Specifically, this is an installation that will allow the evaluation of its technology in real conditions, validate its efficiency, and prepare a secure transition to industrial production.
Furthermore, UM6P is currently collaborating with companies like Oort Energy and Chariot Limited for pilot electrolyzer projects. A 1 MW solar-powered electrolyzer was commissioned in Grantham, UK, marking a significant advance in this alliance.
As early as 2022, UM6P signed an agreement with the Dutch company Proton Ventures BV for the construction of the Green Ammonia Pilot at the OCP group’s chemical complex in Jorf Lasfar. Partnerships with EDF and Shell are also underway for R&D in the renewable energy and green hydrogen sector. These programs will undoubtedly bear fruit soon.
Electrolyzers, a Closed Market
The electrolyzer market is experiencing exponential growth. The projected capacity for 2030, which is already the subject of investment announcements, exceeds 300 gigawatts. Today, an installed alkaline system can cost between $500 and $900 per kilowatt.
A high-performance PEM (Proton Exchange Membrane) can cost between $900 and $1,400 per kilowatt. SOECs promise higher efficiency at high temperatures, but they are still only at the pilot stage.
These are the most widespread technologies, and Morocco has already adopted two: PEM and alkaline. The major players in the field are divided among three regions of the world.
First, China, which is deploying large-scale production with Longi, Sungrow, and Peric. Then, Europe with players like Siemens Energy, Nel, and ITM. Finally, the United States, positioning itself through companies like Cummins and Plug Power.
