Hydrogen

Low-emission hydrogen production faces challenges due to limited demand, slow implementation of support schemes, inflationary pressures, and increasing costs, which jeopardize the viability of the industry and its potential growth.

Everfuel, Denmark’s leading hydrogen refuelling station provider, has announced plans to close or pause operations at its light-duty H2 refuelling stations for passenger cars.

Danish taxi start-up Drivr has temporarily suspended operations for its fleet of 100 Toyota Mirai vehicles due to the closure of Denmark’s hydrogen refuelling stations by Everfuel. Drivr is in discussions with Everfuel to restore hydrogen availability and is exploring alternative refuelling infrastructure options with other partners.

Salzgitter, a German steel company, plans to invest €1bn from its own resources and an additional €1bn in government subsidies towards its decarbonization program, which includes the construction of a 100MW green hydrogen plant for steelmaking. The company aims to cut emissions from steel production by 95% by 2033 and will begin converting its facilities to operate on green hydrogen from the end of 2025. However, it is uncertain whether local production will be the only source of supply, indicating the potential for hydrogen imports via pipelines. The International Energy Agency recommends actions to accelerate the transition to low-emission hydrogen and promote its adoption in various sectors.

The US Department of Energy (DOE) has granted $48m to 16 hydrogen research and development projects, with a focus on enhancing liquid hydrogen storage and fuelling for vehicles, as well as onboard storage systems and new hydrogen carriers. The funding aims to address challenges such as hydrogen “boiling off” as a gas and support the growth of the carbon capture and storage (CCS) market, particularly in relation to blue hydrogen production. These investments and developments are expected to shape the future of the hydrogen industry.

Hamburg-based company Eternal Power is exploring the potential for hydrogen production in Chile to export to Germany and Europe, with plans to have the first shipments of green hydrogen derivatives reach Europe by 2030. The Chilean Energy Ministry aims to produce green hydrogen at approximately $1.5/kg and become a major exporter of the energy carrier. Eternal Power is collaborating with local partners to identify suitable locations for large-scale gigawatt plants, which will be used for the production of green hydrogen carriers. The European Commission has initiated a €225m fund for renewable hydrogen in Chile, recognizing the country’s export potential and its importance in Europe’s plans to import 10 million tonnes of green hydrogen per year by 2030. Additionally, SEFE, a German gas importer and trader, has expressed interest in clean hydrogen production and is considering investing in hydrogen projects. In France, the government has released draft details of tenders worth €4bn to support 1GW of electrolysis capacity over the next three years, prioritizing low-carbon hydrogen produced from zero-carbon electricity sources.

Green hydrogen, a renewable energy source, could benefit developing countries with abundant wind and solar resources and available land, but export-focused projects face challenges related to financing and construction, potentially impacting the price of hydrogen.

The European Hydrogen Bank’s pilot auction has raised concerns about potential underbidding on hydrogen project costs.

Bavaria, the largest state in Germany, has launched a €45 million funding round to support the development of green hydrogen projects.

The European Union’s ambitious goals for green hydrogen production could have a significant impact on renewable electricity consumption, surpassing Germany’s current annual demand and accounting for a substantial portion of electricity produced by new wind and solar capacity. However, concerns have been raised about the prioritization of green hydrogen production, as it may lead to inefficiencies and higher costs for customers. The UK government’s subsidy package for Tata Steel aims to decarbonize the Port Talbot steelworks, while discussions about decarbonization options in the steel industry continue. The European Commission’s proposed extension of the joint gas purchasing scheme to hydrogen and the upcoming pilot auction by the European Hydrogen Bank raise questions about the H2Global scheme in Germany.