German-Russian Energy Bridge

Berlin calls on the EU to modify its policy toward Russia with the objective of cooperating in the use of hydrogen power.

BERLIN/MOSCOW | | russische-foederation

BERLIN/MOSCOW (Own report) - In the run-up to next week's EU summit, Berlin is calling on the EU to modify its policy toward Russia. This was indicated in a report on an internal meeting in Brussels and a "non-paper" from Germany circulating within the EU. According to the report, at a meeting last week with several top officials of the EU External Action Service, the German EU Ambassador to Russia, Markus Ederer, advocated enhanced cooperation with Moscow in selected areas. Already earlier, a German non-paper circulating within the EU promoted closer cooperation on climate change, particularly on the use of hydrogen power, despite continued EU sanctions. Whereas the German need to import hydrogen will grow considerably in the coming years, Russia possesses great potential for producing hydrogen from natural gas and from wind power. Work on initial projects has already begun, with Berlin's support. It has been noted that, in the future, the Nord Stream 2 pipeline could be converted for importing hydrogen.

Berlin Exerts Pressure

On Monday of last week, EU Ambassador to Russia, Markus Ederer, spoke out in favor of modifying policy toward Russia. Ederer - who, in the course of his career has also been Head of Policy Planning (2005 to 2010) and State Secretary (2014 to 2017) in the German Ministry of Foreign Affairs - had assumed his position in Moscow in October 2017. It is his second EU diplomatic assignment, following his appointment as the EU's Ambassador to China (January 2011 to January 2014). He can be considered a diplomatic heavyweight both in Berlin and Brussels. At his meeting last Monday with EU Foreign Affairs Commissioner Josep Borrell, Stefano Sannino, General Secretary of the European External Action Service and his deputy Pedro Serrano, as well as Russia division chief Luc Pierre Devigne, Ederer reportedly advocated closer cooperation with Moscow: The diplomat is quoted to have said that it is necessary to stop focusing on the Ukraine conflict.[1] At a meeting of EU ambassadors Wednesday, some member states took a similar position, according to the report. Italy, for example, suggested closer economic cooperation, whereas some Eastern European states insisted on escalating the aggressive approach.

"Difficult but Indispensable"

Berlin had put a paper with a similar tenor into circulation in Brussels, earlier, whereby, officially it is an unsigned and undated “non-paper,” which EU countries use to air ideas without having to take formal responsibility for them. The "non-paper foresees close transatlantic coordination in relationship to Russia, and does not call for renunciation of sanctions and other aggressive measures. (german-foreign-policy.com reported.[2]) It does however, advocate seeking cooperation in certain areas and, thereby, at least slowing the escalation spiral that relations with Moscow are currently in danger of developing. The fact that Russia has an “indispensable”, if “often difficult”, role in various global policy fields, - in conflicts in the Middle East and north Africa - means the EU would have a “vital interest” in stable and predictable relations, if it wants to have influence itself.[3] This is the motive given. The EU should therefore seek to engage Russia for example to fight climate change. In this context, the German "non-Paper" explicitly mentions an intensified cooperation on the issue of hydrogen power.

Consequences of the Energy Transition

On the German side, it is foreseeable that there will be a growing demand for hydrogen as a source of energy due to the energy transition. By 2030 alone, the German government predicts it will need between 90 - 110 TWh, the largest majority of which must be imported, according to the government's "National Hydrogen Strategy" from June 2020.[4] Initially, Berlin had mainly targeted North Africa's sunny and windy regions as production sites for "green" hydrogen, which could be delivered by tankers. An agreement with Morocco, dating back to November 29, 2019, also envisages such a cooperation.[5] Russia, on the other hand, has also been focusing on hydrogen production since last year, because, for one thing, the EU's energy transition will - foreseeably after 2030 - lead to its decreasing demand for oil and gas, and therefore a sharp reduction in Russia's most important exports. As an alternative, Russia's new energy strategy (from 2020) is promoting the introduction of the production of "blue" and "turquoise" hydrogen from natural gas. In addition, "green" hydrogen, from wind energy, is also being contemplated. Business circles are speculating that by 2035, at the latest, two million tons of hydrogen will be annually exported.[6]

"Hydrogen - the Technology of the Future"

In the meantime, concrete projects have been launched. In Russia, Gazprom, and, among others, Novatek, the largest private energy company of the country, want to begin producing hydrogen. Gazprom has commissioned a feasibility study on the question from the Karlsruher Institut für Technologie (KIT),[7] while Novatek and Siemens want to cooperate. The two companies - which are already cooperating closely in Novatek's liquified gas projects in the Russian Arctic - signed an agreement in December 2020 that also includes using liquified gas to produce hydrogen.[8] On the German side, the German Committee on Eastern European Economic Relations (OA) has in the meantime been joined by the German government in the plea for "cooperation in research and industry" in relationship to "hydrogen, the technology of the future," as was recently formulated by the government's coordinator for Intersocietal Cooperation with Russia Johann Saatoff. Saatoff, who is also spokesperson for energy policy for the SPD parliamentary group, announced that within the framework of the German-Russian Theme Year - "Economy and Sustainable Development 2020 - 2022" - which began in November, Berlin will create "a new structure, which will invigorate the dialog ... on the issue of hydrogen."[9]

Nord Stream 2

Saathoff not only pointed out that, alongside its natural gas deposits, Russia also has excellent conditions for the use of wind energy. "The technical capacity for onshore wind energy is at least a thousand times greater than the wind energy currently installed in Germany."[10] Berlin's government coordinator also recalled that - unlike the case of Morocco - "the delivery infrastructure already exists" for supplying Germany with hydrogen. "The pipelines bringing us oil and gas, today, can be converted to bring hydrogen." Therefore, the German-Russian plans for cooperation in the field of hydrogen correspond to the German government's insistence on the construction of the Nord Stream 2 gas pipeline. Recently, the German Foreign Ministry's State Secretary, Miguel Berger, insisted in his virtual address to the German Committee on Eastern European Economic Relations' annual kick-off event that "we have no interest in this [Nord Stream 2] project becoming a failed investment."[11] He said that while we are willing to negotiate certain concessions with the Biden administration, it is clear that "the finalization of this pipeline must be the conclusion of this dialog." Previously, Foreign Minister Maas had made the same commitment.[12]

 

[1] Alberto Nardelli: EU Officials Plot Lighter Touch on Russia But It's a Tough Sell. bloomberg.com 13.03.2021.

[2] See also The Spiral of Escalation.

[3] Michael Peel: Germany urges new outreach to Moscow on climate change. ft.com 07.03.2021.

[4] Die Nationale Wasserstoffstrategie. Berlin, Juni 2020.

[5] See also Die Geoökonomie des Wasserstoffs.

[6] Hans-Jürgen Wittmann: Russland möchte bis 2035 Weltmarktführer bei Wasserstoff werden. gtai.de 25.12.2020. See also Die Geopolitik des European Green Deal (II).

[7] Hans-Jürgen Wittmann: Russland entwickelt eigene Wasserstofftechnologien. gtai.de 01.07.2020.

[8] Lydia Woellwarth: Novatek and Siemens Energy sign agreement. lngindustry.com 11.12.2021.

[9], [10] Johann Saathoff: Die Bundesrepublik sollte ihre Kooperation mit Russland und seinen Nachbarn ausbauen. handelsblatt.com 08.02.2021.

[11] Virtueller Jahresauftakt mit Bundespräsident Steinmeier und 350 Gästen. ost-ausschuss.de 26.02.2021.

[12] See also Transatlantic Sanctions (III).