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The energy demand of the building sector is mainly used for energy consumption of heating (space heating), heating (domestic hot water) and so on. Hydrogen heating is currently not superior to competing technologies such as natural gas heating (the most common heating fuel) in terms of efficiency, cost, safety and infrastructure availability.

Since the use of pure hydrogen requires new hydrogen boilers or extensive retrofitting of existing pipes, the cost of using pure hydrogen in buildings is relatively high. In Europe, for example, hydrogen energy use started earlier than elsewhere, but the cost of hydrogen heating is still more than twice that of natural gas. Even by 2050, when heat pumps become the most economical option, hydrogen heating could still cost 50 per cent more than natural gas heating.

Hydrogen can be transported by pure hydrogen or mixed with natural gas, which requires more pipeline. Hydrogen can also pose a safety risk to steel natural gas lines, which will need to be replaced with polyethylene lines. Such investments may make economic sense for larger commercial buildings or district heating networks, but may be too costly for smaller residential units.