Governments are being called on to lead the development of hydrogen as a clean fuel after a new report from the International Energy Agency (IEA) said the world needs faster adoption of low-carbon hydrogen to get on track for a sustainable energy system by 2050.

"It is important to support the development of low-carbon hydrogen if governments are going to meet their climate and energy ambitions," said Fatih Birol, the IEA Executive Director.

"Governments need to take rapid actions to lower the barriers that are holding low-carbon hydrogen back from faster growth, which will be important if the world is to have a chance of reaching net zero emissions by 2050."

While replacing fossil fuels with electricity to power cars and heating homes is the best option there are some areas like heavy transport, such as ships, buses and lorries, where battery power may not work.

This is where hydrogen could replace fossil fuels, it is argued. It is also seen as having the potential to decarbonise heavy industries such as steel.

In the Irish context, it could be used as a way to store energy from renewables such as wind or solar.

It can be burned, when mixed with natural gas, in conventional gas power plants to generate electricity when the wind does not blow, lessening the need for coal or natural gas in the energy system.

But more established and lower cost methods of producing hydrogen using fossil fuels are not low carbon.

Green or low carbon hydrogen can only be made by electrolysis using electricity from renewable sources. But that can be expensive and not competitive with other energy sources.

The International Energy Agency in its Global Hydrogen Review said the technologies to deliver low carbon hydrogen at a competitive price are being developed but investors need to have confidence in future demand.

Only then will the funding to scale up production become available, it said. It wants governments to produce plans and road maps for hydrogen as a low carbon fuel.

It recommends they offer strong incentives to use low-carbon hydrogen instead of fossil fuels. The report also calls on governments to give strong support for technical innovation to ensure critical technologies reach commercialisation quickly.

The IEA says that, in the long term, consumer demand will drive investment in low-carbon hydrogen but argues that in the short term it is up to policymakers to pull various levers to attract capital to the right places to create that demand.

It says demand for hydrogen has grown by 50% since 2000 but that has mostly been in the refining and industrial sectors.

The IAE says if net zero emissions are to be achieved by 2050 there will need to be "a step change in rolling out hydrogen technologies".

Some countries such as Japan and the US have stepped up their investment in hydrogen technology and the European Union published its hydrogen strategy last year.

In Ireland, there are no plans for large scale use of hydrogen, but Bus Éireann has acquired three double decker hydrogen-fuelled buses as part of a pilot project.

Responding to the IEA Global Hydrogen review the Department of the Environment, Climate and Communications struck a note of caution, saying it is maintaining the energy efficiency first principle with direct use of renewables and electrification.

It added that hydrogen may be part of the energy mix as renewables particularly offshore wind is further developed

It said: "Hydrogen ought to be produced and deployed in a way that is coherent with our decarbonisation goals, in particular to avoid any potential lock-in of non-green/non-renewable hydrogen use that isn't coherent with net zero by 2050."

The Department said it seeks to prevent the "green-washing" of hydrogen produced from grid electricity and ensuring there is no counterproductive competition between electrolysers which produce hydrogen and other direct uses of renewable electricity.

However the statement goes on to add that: "Ireland has considerable potential to produce renewable hydrogen from excess renewable electricity, particularly from offshore wind, as we move towards our 2030 renewable electricity target."

It also noted that gas distribution system, being relatively new is made up entirely of Polyethylene pipes and well suited to accommodate hydrogen. Gas Networks Ireland is currently carrying out initial testing to see some levels of hydrogen could be accommodated in the grid.

Ireland's gas distribution system is relatively new and therefore made up entirely of polyethylene pipes and so is well suited to accommodate hydrogen.

The transmission and distribution system operator, Gas Networks Ireland, is currently carrying out initial testing in relation to how levels of hydrogen could be accommodated in the grid.

It said the role of hydrogen is being considered as part of the development of the next Climate Action Plan currently underway.