Grey hydrogen generally refers to hydrogen produced from fossil fuels without capturing the resulting carbon dioxide. Natural-gas steam methane reforming is a common route. Coal gasification is another fossil-based process, although some sources label coal-based hydrogen brown or black rather than grey.
The product can be chemically identical to hydrogen made using renewable power. The difference lies in upstream fuel extraction, energy inputs and production emissions. That matters because hydrogen's usefulness as a decarbonization tool depends heavily on its production pathway.
Fossil-fuel-based hydrogen has long supplied refineries and chemical plants. Its production cost changes with the price of natural gas or coal and with carbon costs, energy efficiency and local plant conditions. Adding carbon capture can reduce some emissions but does not automatically remove all of them.
When someone compares green and grey hydrogen prices, check whether both figures include the same energy, carbon, transport and delivery costs. Use measured lifecycle emissions rather than relying only on color names.