Status: 11.08.2023, 21:54 p.m.
By: Manuel Berkel
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Steel production at Thyssen Krupp in Duisburg: Hydrogen is crucial for the energy transition. © Sven Simon/Imago
A new analysis by the EU Commission considers the electrolysis of hydrogen in Germany to be uneconomical in the long term. Europe's hydrogen superpower could become a different country.
Three basic beliefs of the future hydrogen world are being shaken by a new analysis published a few days ago by the EU Commission's Directorate-General for Energy.
- In a perfect domestic market, the capacity of electrolysers that could be operated economically in Germany would be zero in 2050. The largest producer of green hydrogen would be France, of all countries.
- It would be most cost-effective for the EU to meet its own hydrogen needs. Imports would be neither necessary nor economical.
- If ammonia, ethylene and sponge iron were imported and only the further processing steps were to take place in the EU, hydrogen demand could fall by a third – with significant differences for the expansion of the energy system.
The study "The impact of industry transition on a CO₂-neutral European energy system" was prepared by Fraunhofer ISI in Karlsruhe as part of METIS. The results of this long-term project are repeatedly used by the Commission for its energy policy decisions.
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This analysis is IPPEN. MEDIA in the course of a cooperation with the Europe.Table Professional Briefing – it was first published by Europe.Table on 9 August 2023.
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Zero GW electrolysers in the Federal Republic of Germany
It was based on assumptions from a decarbonisation scenario for industry from the EU's "Clean Planet for All" initiative from 2018. The researchers now modelled the energy demand for the manufacturing industry and derived the most economical expansion paths for electricity and hydrogen production. Because this is a purely techno-economic analysis, no political restrictions such as the resilience of the energy supply were assumed. Nevertheless, the results call into question some beliefs that were previously considered secure in the hydrogen debate.
"Central European countries, including Germany, Belgium and the Netherlands, have minimal or no hydrogen production through electrolysis despite their large demand for hydrogen," the report said. The Fraunhofer researchers see electrolysis capacities in Germany at "2050 GW" in 0. In its recently updated National Hydrogen Strategy, the German government is aiming for ten gigawatts by 2030.
France with 130 GW of hydrogen capacity
The EU report sees the reason for this in the cost structure of a hydrogen economy. The cost of transporting H2 is low compared to production and neighboring countries have more favorable conditions. The leading hydrogen producers in Europe, staggered according to their electrolysis capacities in gigawatts, would be in 2050:
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My Area
- France (130 GW)
- Spain (120 GW)
- Great Britain (70-80 GW)
- Norway (70 GW)
- Denmark (50-60 GW)
- Poland (50 GW)
- Finland (20-70 GW)
"France has many good wind locations," says Tobias Fleiter, head of Fraunhofer Studies, explaining the top position. However, the assumed expansion of renewables in France also shows the first limits of the study. The calculations result in 320 gigawatts of photovoltaics and 300 gigawatts of onshore wind energy for France. However, the French government's political goals for 2050 have so far fallen well short of this.
Macron's renewables targets significantly lower
In his Belfort speech in February last year, President Emmanuel Macron set targets for 100 gigawatts of photovoltaics and 40 gigawatts of offshore wind, according to the German-French Office for the Energy Transition. The annual increase in onshore wind is also currently low.
At the same time, the Fraunhofer study assumes that electricity production by French nuclear power plants will decline from 360 terawatt hours in 2021 to 206 terawatt hours by the middle of the century. This is only plausible if one assumes that old reactors are shut down much faster than new ones. With higher shares of nuclear power, the electrolysis capacities would probably be lower, Fleiter estimates.
Stagnant expansion would favour German production
A slightly different picture also emerges in a scenario in which only 70 percent of Europe's renewable energy potential is exploited. Then electrolysis would also make sense in Germany, says co-author Khaled Al-Dabbas. However, capacities are still low. Even in an unpublished scenario with lower pipeline capacities, there would be higher hydrogen production in Germany. "For Germany, however, it would definitely reduce the costs of thinking more about European integration," Fleiter sums up.
Contrary to many political initiatives in Brussels and Berlin, the researchers believe that self-sufficiency in hydrogen is not only possible for Europe, but even cheaper than imports. "That was also interesting for the Commission," Fleiter reveals. "It shows how enormous and cost-effective the renewable energy potential in the EU still is."
European self-sufficiency possible
A slightly different picture emerges again with a 30 percent reduction in the expansion of renewables. A minimum import of 160 terawatt hours of hydrogen by pipeline from Morocco would be necessary – still a small proportion in view of the generation of 3,000 terawatt hours in Europe.
Shipping of hydrogen derivatives and basic products for the fertilizer, chemical and steel industries could nevertheless play an important role. In another scenario, the ISI has calculated the consequences if ammonia, ethylene and sponge iron were no longer produced in Europe but imported. If only these three products were to be replaced, the demand for hydrogen would be reduced by a third. "We almost have a different energy system," says Fleiter.
Many offshore wind farms would become superfluous
On the one hand, imports of hydrogen derivatives would be significantly lower, especially in Germany. However, this would also make most offshore wind farms superfluous. The necessary capacities would be reduced by 60 percent. Many solar systems on roofs would also not be needed from a purely economic point of view.
However, many companies from the basic industries still have different preferences for decarbonization, reports Fleiter: "Some want to import green methanol and ammonia, others prefer hydrogen." Depending on the strategy, some stages of production would remain in the EU, while others would not. The hydrogen demand of the industry is still very uncertain and not necessarily a no-regret measure, as is often assumed.