Water scarcity is a critical factor in determining the geographic placement of hydrogen production facilities, particularly for methods that rely heavily on water as a feedstock or cooling agent. The availability of freshwater resources varies significantly across regions, influencing the feasibility, cost, and sustainability of hydrogen projects. Water-intensive production methods, such as electrolysis and steam methane reforming (SMR), face distinct challenges in water-stressed areas compared to water-rich regions. Policy frameworks further shape the viability of hydrogen production by imposing restrictions or incentives based on local water conditions.

Electrolysis, a leading method for green hydrogen production, requires substantial amounts of purified water—approximately 9 liters per kilogram of hydrogen produced. In regions with limited freshwater resources, this demand competes with agricultural, industrial, and domestic needs. For example, countries in the Middle East and North Africa (MENA), which face extreme water stress, may find large-scale electrolysis projects unsustainable without alternative water sources. In contrast, water-rich regions like Scandinavia or Canada can more easily integrate electrolysis into their energy systems without exacerbating local water shortages.

Steam methane reforming, while less water-intensive than electrolysis, still requires significant water for cooling and steam generation. SMR facilities in arid regions often rely on desalination or wastewater reuse to mitigate freshwater consumption, increasing operational costs. Desalination, though viable, introduces energy penalties and environmental concerns, such as brine discharge. In water-abundant regions, SMR plants can utilize surface or groundwater with fewer constraints, reducing both cost and complexity.

Biomass gasification and thermochemical water splitting also depend on water availability, though to varying degrees. Biomass processes require water for feedstock cultivation and gasification, making them less suitable for arid regions unless non-potable water sources are available. Thermochemical cycles, which often use high-temperature heat, may need water for cooling, posing challenges in water-scarce areas unless dry cooling systems are employed.

The geographic distribution of hydrogen production is thus heavily influenced by regional water budgets. Water-stressed regions must prioritize technologies with lower water footprints or invest in alternative water sources. For instance, coastal areas might couple electrolysis with desalination, while inland arid regions could explore solar thermochemical processes that minimize liquid water use. Water-rich regions, on the other hand, have greater flexibility in adopting conventional methods without significant trade-offs.

Policy plays a pivotal role in shaping hydrogen production in both water-stressed and water-rich regions. In areas with severe water scarcity, governments may impose strict regulations on freshwater use, incentivizing the adoption of low-water or water-free hydrogen technologies. Subsidies for desalination or wastewater recycling infrastructure can also make water-intensive methods more viable. For example, Chile, which faces water stress in its northern regions, has prioritized green hydrogen projects in areas with access to seawater, leveraging its abundant solar resources while minimizing freshwater use.

Conversely, water-rich regions may lack stringent water-use policies for hydrogen production, potentially leading to inefficient resource management. Without regulations, these regions risk overexploiting local water supplies, especially if hydrogen demand grows rapidly. Proactive policies, such as water-use quotas or incentives for closed-loop cooling systems, can prevent such outcomes. Norway, with its ample freshwater and hydropower resources, has integrated water sustainability into its hydrogen strategy, ensuring that production aligns with long-term environmental goals.

International trade further complicates the relationship between water scarcity and hydrogen production. Water-stressed regions may import hydrogen or hydrogen carriers like ammonia from water-abundant countries, reducing local water demand. However, this approach relies on robust transportation infrastructure and trade agreements. Australia, for instance, is exploring large-scale hydrogen exports to water-scarce Asian markets, leveraging its vast renewable and water resources.

The table below summarizes key considerations for hydrogen production in water-stressed versus water-rich regions:

Water-Stressed Regions
- Challenges: High competition for freshwater, need for alternative water sources
- Solutions: Desalination, wastewater reuse, dry cooling systems
- Policy: Strict water-use regulations, subsidies for water-efficient tech

Water-Rich Regions
- Challenges: Risk of overexploitation without regulation
- Solutions: Sustainable water management, closed-loop systems
- Policy: Incentives for resource efficiency, integration with renewable energy

In conclusion, regional water scarcity directly impacts the geographic placement and technological choices for hydrogen production. Water-stressed regions must adopt innovative solutions to balance hydrogen ambitions with water sustainability, while water-rich regions must implement policies to prevent resource depletion. Policymakers play a crucial role in ensuring that hydrogen development aligns with local water conditions, fostering a sustainable transition to a hydrogen economy.