Renewable Hydrogen: A Key Driver for Europe’s Energy Transition

By Kadri Simson, European Commissioner for Energy

The European Green Deal and achieving carbon-neutrality by 2050 has been the main priority of the von der Leyen Commission since taking office at the end of 2019. Despite the challenges of the Covid-19 pandemic, 2020 was the year of laying down the path towards our 2050 target.

Perhaps the most significant step was the agreement by EU leaders that the EU should reduce greenhouse gas emissions 55% by 2030 (relative to 1990 levels) – as proposed by the Commission. This is a political commitment, which ties the EU into raising our ambitions for the coming decade. Our services in the Commission are now preparing a range of proposals for this summer, so that the EU can be “fit for 55%”.

At the same time, the Commission provided a number of other key building blocks in 2020 aimed at achieving our medium and long- term goals. Within the remit of energy policy, these include strategies on energy system integration, renovation, offshore renewable energy, and methane emissions. In legislative terms, we also proposed a revision of the rules for the trans-European networks for energy and produced a detailed assessment of how Member States intend to meet their targets in the coming decade through their respective national energy & climate plans (NECPs).

While all of these initiatives combine to set us on the decarbonisation pathway, the most exciting element for many is the Hydrogen Strategy, published last July.

Its aim – to kickstart investments to scale up the production and use of clean hydrogen and fulfil its potential as one of the key drivers in the green energy transition.

Although hydrogen is already used in the EU, it is for the moment primarily used as a feedstock and less in the energy sector– accounting for only 2% of Europe’s present energy consumption – 96% of this hydrogen is produced with natural gas, emitting significant amounts of CO2 in the process. This form of hydrogen is not sustainable for the long-term. But if we can scale up renewable hydrogen, there is every chance it can make a significant contribution to the clean energy transition and strengthen European industrial competitiveness at the same time.

To decarbonise our energy system, we need more energy efficiency, more renewables and more electrification. However, we also need more renewable fuels and gases. In many sectors of industry and transport, electrification has the potential to respond to the challenge. However, there will be areas, such as long-distance and maritime transport as well as aviation – or certain industrial pro- cesses (such as steel production) – where electrification is simply not an option as it is not available or not cost effective. This is where renewable fuels and gases are needed. And this is why renewable hydrogen can potentially hold the key to eliminate emissions in these hard-to-decarbonise sectors. Furthermore, hydrogen will be important to help balance a renewables-based electricity system by providing long-term storage and buffering of renewable energy.

I am frequently asked if I think Europe can emerge as a leader in a global shift towards clean hydrogen. I have no doubt that we can.

Already today, the EU is leading in the development of electrolysers, a key technology needed to convert renewable electricity into hydrogen.

At the same time, the EU has the right policy framework in place to accelerate the large amount of low-cost renewables needed to produce hydrogen. The EU is also the first region with the objective of climate neutrality, which gives our industry the market and investment certainty.

So where do we stand at present? Today, around 60 MW of electrolysers have been tested and demonstrated in the EU. By the end of 2024, we aim to have 6 GW of electrolysers – a hundred-fold increase, and 40 GW of electrolysers by 2030 with the aim to produce 10 million tonnes of renewable hydrogen. To achieve these objectives, we not only need to scale up individual plants, but to develop the associated hydrogen ecosystem and supply chains for storing, transport, and delivering hydrogen to the end-consumers. Investments will be needed to transform our industrial processes, to build larger electrolysers and to develop the hydrogen trucks, boats and planes of the future. This creates an enormous industrial opportunity for the EU.

Our Member States are already responding to this challenge. National strategies have been launched by France, Germany, Netherlands, Portugal and Spain, with draft strategies in preparation by Austria, Italy, Poland and others.

Furthermore, 22 Member States have signed a collaboration agreement to jointly develop and support innovative cross-border hydrogen projects. A recent agreement signed by Portugal and the Netherlands to transport renewable hydrogen from Portugal to the Netherlands shows the commitment towards a common approach.

At the same time, clean hydrogen offers new opportunities to re-design our energy partnerships with our neighbouring countries and regions, and as a way to contribute to their clean energy transition. In particular, North Africa has great potential to supply cost-competitive renewable hydrogen to the EU if the renewable power generation in these countries accelerates. I am therefore pleased that the European Commission and Morocco are jointly facilitating a new collaborative platform on renewable hydrogen under the International Renewable Energy Agency.

The European Green Deal provides us with a holistic approach to tackle the climate challenge. We are applying the same principles to our hydrogen strategy. Hydrogen is part of our growth strategy, it fits within a holistic vision of an integrated energy system, it is based on a collaborative and joint approach among our Member States, and it provides an opportunity to shape the global energy transition.

For more information, see Commission webpage on hydrogen.