A gaggle that assesses the effectiveness of actions by the European Union (EU), together with how power initiatives impression the economies of EU member states, mentioned the present targets for EU hydrogen manufacturing are “overly bold” and never real looking.
The European Courtroom of Auditors (ECA) in a report revealed July 16 mentioned targets to supply as a lot as 10 million tonnes of renewable hydrogen by 2030, and import one other 10 million tonnes, are seemingly based mostly extra on “political will” reasonably than an precise market evaluation.
The EU established its present targets as a part of the group’s plan to supply extra of its personal gas for the power sector, and finally finish a reliance on imports of gas from Russia.
“The EU’s industrial coverage on renewable hydrogen wants a actuality examine,” mentioned Stef Blok, the ECA Member in command of the audit. “The EU ought to resolve on the strategic means ahead in the direction of decarbonization with out impairing the aggressive scenario of key EU industries or creating new strategic dependencies.”
Implications for European Industries
The report mentioned that renewable hydrogen, also called “inexperienced” hydrogen and produced utilizing renewable power sources, “carries important implications for the way forward for key EU industries, as it may possibly assist to decarbonize particularly hard-to-electrify sectors akin to metal manufacturing, petrochemicals, cement, and fertilizers. It might additionally assist the EU to fulfill its 2050 local weather targets of zero carbon emissions and additional cut back the EU’s reliance on Russian fossil fuels.”
The auditors mentioned that funding in hydrogen manufacturing needs to be extra focused, reasonably than unfold amongst a number of packages. The group additionally mentioned the EU “doesn’t have a full overview of wants or of the general public funding obtainable.”
Funding for hydrogen manufacturing from the EU is estimated by the auditors at 18.8 billion euros ($20.5 billion) for the 2021-2027 interval. The report famous, although, that funds are “scattered between a number of packages, thus making it troublesome for firms to find out the kind of funding finest suited to a given venture. The majority of EU funding is utilized by these member states with a excessive share of hard-to-decarbonize trade, and that are additionally extra superior by way of deliberate tasks, i.e. Germany, Spain, France, and the Netherlands. Nevertheless, there may be nonetheless no assure that the EU’s hydrogen manufacturing potential might be absolutely harnessed, or that public funding will permit the EU to move inexperienced hydrogen throughout the bloc from nations with good manufacturing potential to these with excessive industrial demand.”
Skeptical About Targets
The auditors additionally mentioned they discovered that one other goal set by EU members, calling for set up of at the very least 40 GW of renewable hydrogen electrolyzers by 2030, was truly an thought prompt by a lobbying group for the hydrogen trade.
The ECA mentioned it discovered that regardless of the cash spent up to now, tasks including lower than 5 GW of manufacturing capability by 2030 are in a complicated stage. It famous, although, that tasks that would present about 50 GW of capability are at the moment being assessed.
“The auditors name on the [European] Fee to replace its hydrogen technique, based mostly on a cautious evaluation of three vital areas: the way to calibrate market incentives for renewable hydrogen manufacturing and use; the way to prioritize scarce EU funding and which components of the worth chain to give attention to; and which industries the EU needs to maintain and at what worth, given the geopolitical implications of EU manufacturing in comparison with imports from non-EU nations,” the report mentioned.
The report mentioned hydrogen accounted for lower than 2% of European power consumption in 2022, with most of that demand from refinery operations. The ECA mentioned it doesn’t anticipate demand will attain even 10 million tonnes by 2030, or lower than half of what the European Fee has prompt.
—Darrell Proctor is a senior affiliate editor for POWER (@POWERmagazine).
