Green hydrogen produced in Europe would be cheaper than any imported from outside the continent by 2050, according to a new European Commission (EC) report.

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Yet making green hydrogen in Germany and Belgium would be uneconomical by mid-century, adds the study, entitled The impact of industry transition on a CO2-neutral European energy system, which has been published by the Directorate-General for Energy (DG-ENER).

The 58-page paper, commissioned by the EC but written by the Fraunhofer Institute for Systems and Innovation Research (ISI), examines two scenarios to decarbonise heavy industry by 2050, one called “H2+” in which hydrogen “is the major decarbonisation for feedstocks and process heat”, and the other, “Elec+”, where direct electrification plays a greater role in decarbonising process heat.

In both scenarios, the demand for hydrogen is high, amounting to 3,000TWh in Elec+ and 3,400TWh in H2+.

“In the cost-optimal energy system, the entire demand for hydrogen is covered by domestic production in Europe, with a total of 810GW and 915GW of electrolysis capacity installed in the Elec+ and H2+ scenarios, respectively,” the report says.

“The marginal costs of the domestic production of hydrogen in this cost-optimal system are about 10% below the assumed lowest import potential of €65/MWh H2.”

That figure — which amounts to about €2.17 ($2.38) per kg — is for gaseous hydrogen imported by pipeline from the Middle East or North Africa.

“With less optimal deployment of RES [renewable energy sources] and electrolysers, some hydrogen imports via pipeline could become part of the cost-optimal solution,” the report adds.

The study also looks at which European nations will be able to produce green hydrogen at the lowest cost, and concludes that “central European countries including Germany, Belgium, the Netherlands and others have minimal or no hydrogen production via electrolysis, despite their substantial demand for hydrogen”.

“Given the lower cost of hydrogen transportation compared to local production and the geographic proximity of these countries to others with more favourable hydrogen production conditions, they benefit more from importing hydrogen at a lower cost than producing it locally,” the report explains.

“As a result, France (130 GW), Spain (120 GW), the United Kingdom (70GW), and Norway (70GW) install significant electrolysis capacities, generating higher electricity demand for electrolysis than for conventional applications.”

A chart, pictured above, then shows that in both the Elec+ and H2+ scenarios, Germany and Belgium will produce zero green hydrogen in 2050, with minimal electrolysis capacity in the Netherlands (14GW), Switzerland (12GW), Austria (11GW), Czech Republic (5GW), Slovakia (4GW), Hungary (10GW), Slovenia (1GW) and Croatia (8GW).

“The model results show that, from a cost-optimal perspective, it is preferable to produce hydrogen in countries with high renewable potentials and deploy the necessary hydrogen transport infrastructure,” the report explains.

“It has to be emphasised that these are the results of a cost-optimisation approach that considers only a few restrictions and is by no means intended to be a blueprint for implementation.

“However, it does send the clear message that cooperation among countries is beneficial from the perspective of system costs.”