We have the ambition to become the first climate-neutral continent by 2050 and reduce emission by at least 55% by 2030. This will not be possible without a deep decarbonisation of our industry, our mobility ecosystem and our energy system.
Renewable and low-carbon hydrogen can help us to decarbonise the most polluting industries like steel, chemicals and heavy transport e.g. trucks or aircrafts, where reducing carbon emissions is both urgent and hard to achieve. For instance, when conditions are right, clean hydrogen could help to reduce emissions in the steel sector by almost 95%.
Today, the amount of hydrogen used in the EU remains limited, and is largely produced from fossil fuels. The aim of the EU action is to deploy mature clean hydrogen across all of the most emitting sectors of our economy by the middle of this century, and to become the first fully fledged clean hydrogen market in the world. That is the main message sent by the Hydrogen Strategy for a climate neutral Europe, which the Commission published last year.
What is needed however is to create scale to bring down the costs, especially by building a competitive clean hydrogen value chain in Europe. This of course requires big investments for the scaling up the production of renewable and low-carbon hydrogen, boosting its applications in industry and mobility as well as in the necessary infrastructure.
Cumulative investments in renewable hydrogen in Europe could be up to €180-470 billion by 2030, and in the range of €3-18 billion for low-carbon fossil-based hydrogen.
Combined with EU’s leadership in renewables technologies, the emergence of a hydrogen value chain serving a multitude of industrial sectors and other end uses could employ up to 1 million people, directly and indirectly.
Analysts estimate that clean hydrogen could meet 24% of world energy demand by 2050, with annual sales in the range of €630 billion. And as investment cycles in many of the concerned industries and in the energy sector are around 20-30 years, and as the interest in clean hydrogen is growing globally, we have no time to lose.
But most of all, we need to strengthen partnerships and collaboration among industry, EU, Member States and the relevant stakeholders.
Europe has leading players at each segment of the clean hydrogen value chain, but the challenges of scaling up production and boosting demand require a systemic approach along the whole value chain. That is why in July last year the Commission launched the European Clean Hydrogen Alliance, which brings together industry, national and local public authorities, civil society and other stakeholders. The Alliance has already attracted a lot of interest, with more than 1000 organisations – majority of them companies, joining since its launch. Together with the few thousand participants of the European Hydrogen Forum organised in November, this points to a very big interest from the hydrogen ecosystem. In my discussions with CEOs at the European Hydrogen Forum, leading EU companies confirmed solid commitment to objectives of the Alliance.
Industrial alliances are built to transform this type of commitment into real action. The European Clean Hydrogen Alliance will establish an investment agenda and support the scaling up of the hydrogen value chain across Europe.
It will play a crucial role in facilitating and implementing the European Hydrogen Strategy. It is also a political signal of EU’s commitment to invest in technologies enabling climate neutrality.
The work of the European Clean Hydrogen Alliance is entering a new phase. Following an open call for applications, we are now kicking-off the work of the six thematic roundtables responsible for the alliance’s operational work. They are in charge of building a project pipeline and an investment agenda in their area, while ensuring coherent implementation along the clean hydrogen value chain. When relevant to their mission, they may also flag obstacles and bottlenecks for the upscaling of clean hydrogen, provide input to the work on regulations, standardisation, and research and innovation priorities.
At the same time, it is clear that public support is necessary for large-scale investments to kick-start the clean hydrogen value chain. The Commission has already identified clean hydrogen and renewables as a flagship for the recovery, due to their huge potential for energy transition, job creation and cross-border investment. We are encouraging Member States to do the necessary investments and reforms as part of their national Recovery and Resilience Plans.
We also hope to see concrete projects resulting from the manifesto on Important Projects of Common European Interest on hydrogen, prepared by the German Presidency and signed in December by 23 European countries, which makes clean hydrogen a truly European endeavour.
The EU has supported research and innovation on hydrogen for many years, giving it a head start on the development of clean hydrogen and establishing EU leadership for technologies such as electrolysers, hydrogen refuelling stations and large fuel cells.
By supporting the development of clean hydrogen, we have shown that we are serious about decarbonising our industry and attaining our climate neutrality ambitions. Now we need to consolidate this EU leadership to ensure this technology benefits our economy and society at large.