This week European Commission President Ursula von der Leyen gave the opening keynote at European Hydrogen Week. The Commission President opened her speech with the powerful lines “we all know the world is still not on track to keep global warming below 1.5 degrees Celsius. So we have to speed up significantly. Yet, I think progress was achieved in Glasgow on a number of key files. For example, from an understanding that global emissions must be cut by 45% by 2030 globally, to the fact that by now 90% of the countries have committed themselves to climate-neutrality. And clean hydrogen was among the hottest topics on the agenda of Glasgow, without any doubt.”
She briefly referred to green hydrogen: “Our target should be to bring the cost below EUR 1.8 per kilo by 2030. And this goal is within reach.” Excellent, this seems like a reasonable target. Mukesh Ambani, Chair of Reliance Industries, has gone further and said the cost of green hydrogen in India could fall to $1 per 1kg of green hydrogen within 1 decade (1-1-1). Both of them reflect the growing body of evidence suggesting that green hydrogen will soon be – if it already isn’t - cost competitive with fossil-fuel based hydrogen.
President von der Leyen went on to say that “…we have set the ambitious target to increase Europe's annual production of green hydrogen to 10 million tonnes already by 2030. This is a big step forward.”
But is this really a big step forward? The International Energy Agency predicts that the global production of green hydrogen will need to reach 150 million tonnes per annum by 2030 and the Energy Transition Commission, chaired by Lord Adair Turner, who is also a board member of GH2, predicts that global production of green hydrogen will need to reach 500-800 million tonnes per annum by 2050.
The European Commission’s forecast of 10 million tonnes for a major economic block like the EU is in fact a fraction of what is needed. 10 million tonnes of green hydrogen will not have a significant impact on global warming and our efforts to reach carbon neutrality.
It appears as if a significant shortfall will be made up of what the European President’s speech referred to as “clean hydrogen”. The inevitable conclusion is that the Commission predicts that a vast majority of the EU’s “clean hydrogen” will not be green or renewable, but derived from various forms of fossil fuel. Clean hydrogen is referred to 16 times. Clean hydrogen is not defined and there is no common definition of this term. The speech does not refer to any methane leakage or challenges with carbon capture and storage, which is inevitable in the production of fossil-fuel based hydrogen and which has a significant climate impact. This is disappointing given the Commission’s ambition to reduce methane emissions in the energy sector.
President von der Leyen’s speech came only three weeks after a group of NGOs wrote to her stating that hydrogen needs to come from truly additional renewable electricity. The NGOs wrote: “Only if hydrogen is used in hard-to-abate sectors and produced from additional renewable electricity, can it play a genuine role in limiting temperature increase to 1.5°C, and only as such it can be avoided that increasing renewable electricity demand for renewable hydrogen production will compete with renewable electricity that should go into direct electrification processes across the economy.”
The UN High-Level Champions for Climate Action have also launched a set of guiding principles for climate aligned hydrogen, with principle three being “Renewable hydrogen is the only option strictly aligned with a reliably 1.5-degree energy sector pathway.” It would seem as if the EU is suggesting
otherwise, and that undefined forms of clean hydrogen which is not green (renewable) is aligned with a 1.5 degree pathway.
I draw three conclusions that are different to those of the European Commission:
- So called clean hydrogen which is not green (renewable) brings significant carbon emissions. Such clean hydrogen will not take us closer to 1.5°C, but rather avert much needed resources from greener technologies and slow down decarbonisation.
- The EU is widely underestimating the likely increase in the production and use of green (renewable) hydrogen. With targets so low, the EU will need to import vast amounts of green hydrogen, which brings added complexities and challenges.
- The supply chain of green (renewable) hydrogen is largely different to that of fossil fuel-based hydrogen. It is unlikely that extensive use of hydrogen derived from gas or other fossil fuels will help us prepare for a supply of green (renewable) hydrogen. It is more likely that a dual pathway will result in stranded assets.
We face an existential crisis. We have proven and cost-effective alternatives to oil, gas and coal. It is renewable energy and green hydrogen. Let us not delay this green hydrogen revolution by extending the use of fossil fuels.
Jonas Moberg is the CEO of the Green Hydrogen Organisation (GH2)