German industry is enthusiastic about hydrogen

Economy Minister Peter Altmaier (center) presents Germany's hydrogen strategy on June 10 in Berlin.

It was one of the most significant announcements of the post-Covid-19 recovery plan adopted by Berlin in June: the hydrogen strategy, which aims to make Germany the “World number one in this technology,” in the words of economics minister Peter Altmaier. After years of hesitation, the German project has benefited from the boost allowed by the lifting of budget restrictions due to the health crisis. The result is ambitious: 7 billion euros will be spent to make the technology suitable for commercialization; 2 billion are intended for partnerships abroad.

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The aim is to develop so-called “green” hydrogen technology – made from renewable sources – on an industrial scale and thus become a pillar of the energy transition underway in Germany. It should enable Germany to finally achieve its greenhouse gas emission reduction targets, thanks to the possibilities of storing and transporting hydrogen, but also of direct use as fuel or raw material. The idea is also to acquire technological know-how. By 2030, the country wants to have electrolytic hydrogen production plants with a total capacity of 5,000 megawatts. By 2040, this capacity should reach 10,000 megawatts.

Growth prospects

There is currently a lot of enthusiasm in the industry for the project. The chemicals and steel sectors, two major German specialties with high CO emissions2, could find their salvation in the H molecule, in the face of the pressure to decarbonise their production imposed by the European Union (EU). Some groups have already taken the lead: the steel group Salzgitter (Lower Saxony) was thus equipped in August with a “high temperature electrolysis”, which makes it possible to manufacture green hydrogen from water vapor and electricity. The group aims to eventually replace the coal in its blast furnaces with hydrogen within the next decade.

Traditional energy groups, forced to move away from coal and nuclear power, also see attractive growth prospects. Uniper (formerly E.ON) has been operating for several years two pilot plants for transforming electricity from wind power into hydrogen which is then stored in the gas network, in Falkenhagen, in Brandenburg, and in Hamburg.

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But economic maturity is still far away. A central problem is the availability of “raw material.” “Germany does not produce enough renewable energy on its soil to fuel a large production of hydrogen. And its electricity is already one of the most expensive in Europe. With the loss induced by the transformation process, hydrogen is currently a luxury energy. The ambition is therefore to equip partner countries with electrolyses, powered by renewable energy production on site, for example from solar panels. Several countries in West and South Africa could thus become exporters of green hydrogen, which would meet the bulk of Germany’s future needs. This component, overseen by the Ministry of Development, is still in its infancy.

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