The war in Ukraine has highlighted the need for Europe to accelerate the diversification of energy sources in order to ensure greater independence and security in this area. On 17 May, the European Commission detailed the objectives of the RePowerEU plan that aims to rapidly reduce dependence on Russian fossil fuels and accelerate the energy transition. Among the objectives indicated is an increase of renewable energy generation to 45% of overall energy needs by 2030 compared to the 40% already envisaged under the Fit 55 Plan approved last year.
The acceleration in the development of renewable energy goes hand in hand with the potential incremental production of green hydrogen generated through an electrolysis process powered by renewable sources to separate the oxygen from the hydrogen contained in the water.
The development of green hydrogen production was already envisaged in the European Green Deal the plan that aims to achieve net zero greenhouse gas emissions by 2050 according to which hydrogen should reach 80% of our combustable gases by 2050.
On this front, RePowerEU aims to double the green hydrogen production target set for 2030 to 10 million tons per year, while importing an additional 10 million tons from abroad, thus replacing up to 50 billion cubic meters per year of Russian gas currently imported. This represents enormous growth potential if we consider that today green hydrogen makes up only 1% of total hydrogen production.
The development of green hydrogen production though debated for the last two decades, has been stymied by excessive costs. These costs have progressively fallen, especially in the last decade 60%) and it’s estimated that they should further halve by 2030 ( International Energy Agency).
The President of the European Commission, Ursula von der Leyen, has stated that “Because of the current rise in gas prices that we see, green hydrogen today can even be cheaper than grey hydrogen. Our goal is to bring the cost below €1.80/kilo by 2030“.
At Plenisfer we believe that the political will to support this energy source combined with ongoing technological developments and the reduction of production costs have, after decades, created the conditions for an effective deployment of green hydrogen.