The gas has been dubbed the “champagne of the energy transition,” and that’s not meant as a compliment. In the future, German industry will need huge amounts of climate-friendly hydrogen. The molecules are intended to replace natural gas and coal in steel mills, chemical plants and power plants, for the sake of climate protection. But producing and transporting the hydrogen is expensive – hence the comparison to champagne.
It is also clear that Germany will have to import the miracle gas on a large scale. Domestic production will not suffice; In addition, the costs are likely to be significantly higher than at many foreign locations. However, a study by the Wuppertal Institute for Climate, Environment and Energy has come to the conclusion that the German cost disadvantage is not so dramatic after all: locally-grown Energiewende champagne could then play a more important role than previously thought.
Client of the investigation is the state association for renewable energies in North Rhine-Westphalia. The date of publication on Tuesday is no coincidence, after all, the federal government will present its revised hydrogen strategy in the coming days. Association leader Christian Mildenberger demands that the government should “avoid from the outset in its plans for hydrogen that there will be a similarly high import dependency as with oil and natural gas”.
Climate-friendly – or green – hydrogen is obtained by splitting water in so-called electrolysers, using green electricity. Therefore, production is cheapest in countries where solar and wind power can be produced cheaply and in huge quantities. That is why countries in the Middle East and North Africa as well as Australia and Chile want to become important suppliers of green hydrogen. The molecules can flow to Germany via new pipelines or even through existing natural gas pipes. However, if the distance becomes too great, tankers have to go. For such transports on the high seas, the hydrogen has to be deep-frozen or converted into more easily manageable ammonia – which costs a lot of energy and money.
Does Germany need more wind farms?
If these transport costs are taken into account, the Wuppertal study states that hydrogen produced in Germany is usually cheaper than that imported by ship. Even compared to hydrogen, which is imported via pipelines, molecules made in Germany can often keep up, the scientists write.
But more German hydrogen also means that the country would need even more wind and solar parks to supply the electricity-guzzling electrolysers. Germany is already struggling to expand green electricity quickly enough. Industry lobbyist Mildenberger still sees hydrogen as a good addition. Depending on the weather, there are sometimes huge surpluses of green electricity that can be used to produce hydrogen, he says: “But of course the sluggish expansion of renewable energies must finally make headway.”
So far, the federal government has set the goal that 2030 electrolysers with an output of at least ten gigawatts should produce hydrogen in Germany. Plants with a good eight gigawatts are currently being planned, as shown in an investigation of the energy company Eon. But for most projects, the investments have not yet been approved. In addition, according to Eon’s calculations, these systems would only cover a third of Germany’s needs. The study also points out that there are only 417 kilometers of pure hydrogen pipelines to pump the gas to consumers. After all, 2800 kilometers of new pipelines are planned.
Thyssenkrupp invests billions
The steel industry will be one of the most important consumers. Thyssenkrupp is already leaving one of the four blast furnaces in Europe’s largest steelworks in Duisburg replaced by a so-called direct reduction system. In three years, it will no longer produce pig iron with coke and coal, but with the help of natural gas and later with green hydrogen. To date, the company’s steel division alone has accounted for 2.5 percent of Germany’s carbon dioxide emissions. The federal and state governments want to support the pioneering project with two billion euros in subsidies. However, the EU Commission has not yet approved the fat check, which is why Thyssenkrupp is growing nervous.
It is also uncertain whether the other three blast furnaces will also be replaced by direct reduction plants in the future or whether they will simply be omitted without replacement. Because the management would only approve these huge investments if it was clear that enough green hydrogen could be delivered to Duisburg – at competitive costs.