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Home Home - Europe
hydrogen Germany

Aligning Germany’s Hydrogen Network with Industry Standards

Anela DoksoBy Anela Dokso23/07/20242 Mins Read
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The ambitious proposal for Germany’s hydrogen core network has recently taken a significant step forward with the submission of the draft application by FNB Gas e.V. This network aims to connect key hydrogen sources with main consumption centers and storage facilities across the country.

The draft application outlines an optimized core network spanning approximately 9,700 km, with an estimated investment cost of €19.8 billion​ (FNB Gas)​. This figure includes the conversion of existing natural gas pipelines, which comprise about 60% of the proposed network. While leveraging existing infrastructure is economically advantageous, the extent of required modifications and the associated costs need careful scrutiny. Comparatively, similar projects in other regions have shown varied success rates, often hinging on the technological and economic feasibility of such conversions.

The projected feed-in and feed-out capacities of around 100 GW and 87 GW respectively highlight a robust initial framework​ (FNB Gas)​. However, the real challenge lies in the scalability and flexibility of this infrastructure to adapt to future demands and technological advancements. The German government’s hydrogen strategy emphasizes a rapid and efficient ramp-up, yet the integration of new technologies and the management of capacity fluctuations will be crucial in meeting these goals​ (FNB Gas)​.

A significant aspect of the proposal is the establishment of a financing model that is both market-compatible and capable of addressing interim revenue shortfalls. The draft bill includes mechanisms such as a capped ramp-up fee and the creation of an amortization account​ (FNB Gas)​. However, the interplay between statutory regulations, Federal Network Agency determinations, and contractual agreements remains complex and potentially contentious. Ensuring a seamless and transparent process will be vital for investor confidence and the overall success of the project.

The amendment to the Energy Industry Act (EnWG) and the consultation processes underscore the importance of stakeholder involvement. The opportunity for states, associations, and other stakeholders to comment on the core network development reflects a collaborative approach​ (FNB Gas)​. Nonetheless, the effectiveness of this involvement will largely depend on the responsiveness and adaptability of the regulatory frameworks to incorporate diverse viewpoints and address emerging challenges.

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