Hydrogen for Germany (I)

Green hydrogen

Green hydrogen, which is produced by electrolysing water using electricity from renewable energy sources, is seen as a key technology for the carbon-free energy transition. It causes no CO₂ emissions and could replace fossil fuels in industry and the transport sector. However, the production of green hydrogen is currently still expensive and not very efficient. The problem is that electrolysers require large amounts of energy and only achieve efficiency levels of 60 to 80 per cent. Further challenges relate to storage and transport, as hydrogen is a light, volatile gas that requires special infrastructures. Modern technologies such as high-temperature electrolysis or the storage of hydrogen by converting it into ammonia are being developed in order to overcome these hurdles and improve both efficiency and handling. So innovations in catalysers could reduce energy inputs and costs. German companies, above all Siemens, Linde and ThyssenKrupp, are intensively engaged in the development of these technologies as Germany seeks to position itself as a global player in the wider hydrogen economy.

Germany’s hydrogen strategy

The National Hydrogen Strategy, first presented by the German government in 2020, lays down a policy direction for expanding the hydrogen economy. The current update of this strategy paper, published in July 2023, contains several important new elements. These include the target of doubling the planned electrolysis capacity from 5 GW (gigawatts) to 10 GW by 2030, reflecting a growing demand for hydrogen in Germany. This capacity would then cover 30, perhaps even 50 per cent, of national demand.[1] There is also a stronger emphasis on the import strategy: at least 50 and possibly as much as 70 per cent of Germany’s hydrogen needs are to be met by imports in order to secure a total volume of between 95 and 130 TWh (terawatt hours) of hydrogen per year.[2] The approach here is to diversify supply sources in order to avoid new dependencies. The strategy also foresees steps to advance the process of converting industry and transport to hydrogen before green hydrogen is actually fully available. It is justified by the need to prevent lock-in effects with fossil fuels.[3] The purpose of these strategic adjustments is to make Germany the lead market for hydrogen technologies over the long term and drive decarbonisation in key industries such as steel and chemicals.

The EU's hydrogen strategy

The EU also has a hydrogen strategy, adopted by Brussels in July 2020. The plan is to build 40 GW of electrolysis capacity and produce 10 million tonnes of hydrogen by 2030.[4] In achieving the envisaged capacities the national contributions will differ between EU member states. While Germany is primarily aiming to introduce green hydrogen, the EU is in favour of accepting low-CO₂ hydrogen as a transitional solution. Some of the member states are initially focusing on blue hydrogen, which is produced from natural gas, although its introduction is conditional on the CO₂ produced being used directly or stored. Last year, France successfully pushed for having hydrogen produced from nuclear power categorised as “green hydrogen”, a tactic which German MEP Markus Pieper (CDU) tried in vain to prevent.[5] There is also a long term plan to create an EU-wide Hydrogen Core Network based on existing natural gas pipelines but secure for hydrogen transport. One example is the project to decarbonise industry in southern Baden using green hydrogen piped in from France.[6] There are also plans to build a pipeline from Denmark to Germany. It has, however, been hit by a three-year delay. Instead of starting in 2028 as originally agreed, it is now not due to commence operations until 2031 because additional environmental and safety tests are needed.[7]

Neo-colonial dependency

One such initiative for having green hydrogen produced in hot countries and imported into the EU is Dii Desert Energy. This corporate initiative emerged from Desertec, an ambitious project founded in 2009 with the aim of generating wind and solar energy in North Africa and supplying Europe with power via submarine cables. There were huge investments planned, totalling 400 billion euros, but the project ultimately collapsed, not least because the North African economies involved suffer electricity shortfalls of their own and have objected to a neo-colonial dependence on Europe.[8] Desertec ultimately failed and shrank into the smaller-scale service company, Dii, but the idea of using renewable energy from North Africa for consumption in Germany has resurfaced in a plan to use solar energy to produce green hydrogen for use in Germany. Dii has repositioned itself and is now conducting studies and collaborative projects on renewable energy and hydrogen with over 110 partners. In its official statements, Dii renounces neo-colonial behaviour. “We won't get anywhere by lecturing people,” explains CEO Cornelius Matthes with regard to North African partners. “I’m very well aware that that it doesn't work when we Europeans go to a country and say this is how it has to be done.”[9] The approach, he says, has become “more humble”, with the company “responding to the wishes of the partner countries, especially when it comes to local value creation.”

Middle East/North Africa: the key region

At a Dii Desert Energy Leadership Summit held in Vienna on 15/16 October, the MENA region (Middle East/North Africa) was identified as the regional focus for global hydrogen production. In April 2024, 27 GW were already being produced there using renewable energy sources. Saudi Arabia and Bahrain have set themselves the target of net zero emissions to be achieved by 2060. The United Arab Emirates and Oman want to do this by 2050. Qatar says it will reduce emissions by 25 per cent by 2035, and Kuwait commits to 7.4 per cent. To date, the petrochemical industry in the MENA region produces around ten million tonnes of grey hydrogen per year.[10] Grey hydrogen involves a steam methane process with non-capture of greenhouse gases. However, of 98 projects planned for the future in MENA, more than 90 per cent are already being designed for green hydrogen production.[11] Qatar, whose Emir met with German Chancellor Olaf Scholz in Berlin last Tuesday, is currently advancing plans to launch its green hydrogen facilities.[12] Doha is talking about a hydrogen partnership with Germany as an importer.[13]

Unequal division of labour

At the Dii Desert Energy Leadership Summit, Dii presented a study highlighting the idea that switching to renewable energy, especially solar, would create numerous jobs across the MENA region. Jordan could, the study claims, expect almost 30 per cent of this employment bonus. The hydrogen economy and local-level expansion of value chains could, directly and indirectly, create between 400 and 900 thousand jobs in just three countries on the Arabian Peninsula by 2050. Or so it is claimed. However, a closer look at this scenario and the type of jobs created reveals, once again, an unequal global division of labour, which gives the biggest advantages to the West. The EU is the leader in the production of electrolysers and other key technologies, whereas the low-skilled part of the value chain will be performed in the MENA economies.[14] The green hydrogen plans have been criticised as a way of cementing the stronger position of the industrialised West over a technologically weaker Global South.

[1] Bundesministerium für Bildung und Forschung: Nationale Wasserstoffstrategie. bmbf.de 2023.

[2] GET H2 Whitepaper: Analyse der Nationalen Wasserstoffstrategie 2023. get-h2.de 2023. Taylor Wessing: Fortschreibung der Nationalen Wasserstoffstrategie 2023. taylorwessing.com 2023.

[3] Wasserstoff-Technologie. bundesregierung.de 2024.

[4] Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: A hydrogen strategy for a climate-neutral Europe. COM(2020) 301 final. Brussels, 08.07.2020.

[5] Paul Messad: Lawmakers reject German MEP’s attempt to kill EU green hydrogen rules. euractiv.com 30.03.2023.

[6] Christine Veenstra: Wasserstoff: Pipeline aus Frankreich oder eigene Produktion in Südbaden? swr.de 09.03.2024.

[7] Start der Wasserstoffpipeline von Dänemark nach Deutschland verzögert sich um Jahre. spiegel.de 08.10.2024.

[8] See also: Kampf um den Wüstenstrom and Die Geoökonomie des Wasserstoffs.

[9] "Mit einer belehrenden Art kommen wir nicht weiter". energate-messenger.de 23.04.2024.

[10] Valentina Olabi, Hussam Jouhara: An assessment of current hydrogen supply chains in the Gulf Cooperation Council (GCC). sciencedirect.com 15.07.2024.

[11] Dii: A Green Revolution. A Socio-Economic Perspective on Renewables and Hydrogen in the MENA region. dii-desertenergy.org.

[12] Qatar’s clean energy strategy targets renewables. businessstartupqatar.com 13.10.2024.

[13] Qatar, Germany – Strong Historical Friendship, Promising Strategic Partnership. qna.org.qa 22.10.2024.

[14] Green hydrogen: a new mechanism of plunder and exploitation. cetri.be 28.05.2024.