Strategic Local Content Frameworks for Energy Transition Projects: Enhancing Supply Chain Competitiveness in Hydrogen, LNG, and Carbon Capture Developments.
DOI:
https://doi.org/10.63084/algora.v2i1.79Keywords:
Local Content Requirements, Supply Chain Competitiveness, Hydrogen Economy, Liquefied Natural Gas, Carbon Capture and StorageAbstract
Energy transition projects in hydrogen, liquefied natural gas (LNG), and carbon capture and storage (CCS) represent critical pathways toward global decarbonization, yet their deployment raises fundamental questions about supply chain competitiveness and local economic value capture. This paper examines strategic local content frameworks across these three sectors, analyzing how policy mechanisms, industrial strategies, and supply chain configurations interact to enhance competitiveness while promoting localization objectives. Drawing on comparative policy analysis and empirical evidence from multiple jurisdictions, the study identifies sector-specific competitiveness drivers, evaluates local content policy instruments, and proposes an integrated conceptual framework linking localization strategies to supply chain performance. Findings reveal that hydrogen supply chains prioritize resource endowments, electrolyzer technology access, and certification systems; LNG developments emphasize infrastructure investment and carbon mitigation integration; and CCS projects depend on proximity to geological storage sites, transport logistics, and regulatory de-risking. Cross-sectoral analysis demonstrates that effective local content frameworks require tailored policy approaches combining conditional subsidies, procurement mechanisms, capacity-building initiatives, and contractual instruments, while navigating World Trade Organization (WTO) constraints. The paper contributes a comparative assessment of local content leverage points and competitiveness indicators across the three sectors, offering policy implications for governments and industry stakeholders seeking to balance localization ambitions with global competitiveness imperatives in energy transition investments.
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