HYDROGEN ECONOMYGermany Will Rely on Imports for Its Growing Hydrogen Needs

By Sabine Kinkartz

Published 26 July 2023

Revisiting its national hydrogen strategy (NHS), the German government foresees a huge need for hydrogen. By 2030, hydrogen consumption may hit 130 terawatt hours — that is more than one-fifth of all current electricity consumption in Germany. But Germany will need to import as much as 70% of it.

Germany’s path to eliminating its carbon footprint by 2045 is to phase out fossil fuels, expand renewable energies and boost efficiency. The government foresees hydrogen playing a major role.

The volatile gas is produced by splitting water into hydrogen and oxygen. Doing that requires an immense amount of energy. If that energy is based on renewables, hydrogen producers can brand it as “green hydrogen” which is a “clean” energy. Currently, however, most hydrogen is produced with natural gas.

Hydrogen could play an important role in areas where decarbonization is difficult. Energy-intensive sectors such as steel, chemicals and cement production, as well as air and sea transport, may be able to lower their climate impact by using hydrogen.

Green’ Hydrogen: Enormous Demand
Germany’s national hydrogen strategy was drafted in 2020, under the previous government led by Chancellor Angela Merkel. The current federal government has updated it to include, among other things, targeting transport and home heating as areas to use hydrogen.

This is expected to drive already considerable demand even higher. By 2030, hydrogen consumption may hit 130 terawatt hours — that is more than one-fifth of all electricity consumption in Germany in 2021, according to AGEB, an energy market research group.

Shipping alone could consume 120 terawatt hours, according to a study by the German Maritime Center.

At least 50-70% will have to be imported,” said Jochen Flasbarth, a state secretary at Germany’s Ministry for Economic Cooperation and Development (BMZ). “Unlike in the fossil world, the hydrogen economy has a very wide range of potential supplier countries.”

The world’s “sun belt” could be a good bet, he added, given the potential for solar and wind power generation there.

Morocco Taking the Lead
The BMZ has begun hydrogen projects with Morocco, Brazil, Tunisia, Algeria, Namibia and South Africa. German and other European companies work alongside local ones.

In Morocco, Africa’s first, large-scale plant for green hydrogen is scheduled to go online in 2026. In Namibia, the BMZ is working to help expand wind energy.

We have geared our policies to this hydrogen world economy,” Flasbarth said.

So far, the BMZ has made €270 million ($299 million) available to spur investment in partner countries, which Flasbarth said he hopes translates into €1.3 billion when the private sector gets involved.

Human Rights and Environmental Concerns
Development deals like these are often fraught with human rights and environmental concerns. To address these, Flasbarth said the BMZ has designed a program that excludes countries still reliant on fossil fuels or those that themselves are desperate for energy.

Aside from the problem of sourcing clean energy to make hydrogen, you also need a lot of water. Climate change has worsened drought conditions in many parts of the world, and many of the BMZ’s African partners are confronted with desertification, as the Sahara expands.

Ports and Pipelines
If coming from outside Germany, or Europe, the hydrogen needs to be shipped. Since it is a flammable gas, it needs to be converted into a more stable form, then converted back. Germany foresees terminals currently processing liquid natural gas, a prime cause of heat-trapping methane, being converted for this purpose.

Pipelines are also a possible route. The NHS is looking to a “hydrogen start-up network” by 2028. That would include 4,500 kilometers (2,796 miles) of existing and new pipe across Europe. The goal is that “all major generation, import and storage centers will be connected to the relevant customers” by 2030.

Jobs in Germany
To make this plan politically salient, policymakers have to show that it will benefit German workers. Many of the parts and technology to construct a global hydrogen network, which is also considered climate neutral, could come from major German suppliers. Bosch, for example, expects that about 20% of heavy commercial vehicles will need a hydrogen fuel cell by 2030. That is something the German industrial giant could provide.

That promise, however, comes at a time when clean technologies could threaten jobs. Electric vehicles, for example, require only one-tenth of the workforce that traditional combustion engines need.

Sabine Kinkartz reports for DW on politics and economic affairs. This article is published This courtesy of Deutsche Welle (DW).