A comparative assessment of green and blue options: hydrogen color pathways’ considerations in Uruguay

Abstract Cutting emissions from the global energy system will require scaling up alternatives to fossil fuels, with hydrogen increasingly viewed as a key component of this transition. Its environmental and economic performance, however, depends heavily on the production pathway. This paper presents a comparative assessment of green hydrogen, produced through electrolysis powered by renewable energy, and blue hydrogen, obtained from methane reforming with carbon capture and storage (CCS). Drawing on recent life cycle assessments (LCAs), techno-economic analyses, and policy frameworks, the study examines each pathway’s environmental impacts, cost structures, and potential applications across sectors. According to various forecasts, ongoing reductions in renewable electricity prices and improvements in electrolyzer efficiency may allow green hydrogen to achieve cost parity with blue hydrogen before 2035. Conversely, blue hydrogen tends to result in greater emissions and is subject to uncertainties associated with CCS efficiency, fluctuating fossil fuel prices, and methane leakage. Although blue hydrogen may temporarily support hard-to-abate sectors like shipping and heavy industry, its deployment must be subject to strict regulatory oversight and transparent emissions tracking. Beyond the global perspective, the paper also evaluates the relevance and feasibility of green and blue hydrogen pathways in Uruguay, considering the country’s renewable energy endowment, decarbonization goals, and emerging policy frameworks. The findings point to prioritizing green hydrogen in long-term strategies and underscore the importance of consistent LCA methodologies, expanded renewable energy infrastructure, and clear policy incentives to support a genuinely sustainable hydrogen economy.