Germany’s recent approval to invest around three billion euros in hydrogen infrastructure is a significant step towards a greener future. The EU Commission’s decision to support this investment aims to enhance the use of climate-friendly hydrogen in industry and transport.
The EU Commission has given Germany the green light to invest in long-distance pipelines for hydrogen, with the first major line expected to be operational by 2025 and a core network by 2032. This move is aimed at replacing fossil fuels with green hydrogen, produced using renewable energy sources like wind and solar. While the potential benefits of this investment are substantial, the risks and challenges involved cannot be overlooked.
One of the primary concerns with state support in the EU is ensuring that it does not distort competition. The EU’s stringent rules aim to maintain a level playing field, but the hydrogen sector’s nascent stage necessitates state intervention to mitigate initial losses and secure cheap loans for companies. This delicate balance between state aid and market competition will be crucial in determining the project’s success and its impact on the broader market.
The National Hydrogen Council has voiced concerns about the slow progress in Germany’s hydrogen economy. Four years after the National Hydrogen Strategy (NWS) was formulated, the hydrogen ramp-up appears stalled. The Council’s statement highlights the gap between political ambitions and practical implementation, which threatens Germany’s position in the international hydrogen race.
The difference between planned hydrogen projects and final investment decisions underscores the challenges in translating policy into practice. Energy-intensive industries are particularly anxious about the availability and affordability of hydrogen, which is essential for maintaining competitiveness and achieving climate goals. The Hydrogen Council’s call for reliable framework conditions and public funding measures is a critical step in addressing these concerns.
The uncertainty surrounding hydrogen supply and costs poses a significant risk to deindustrialization. Katherina Reiche, chair of the Hydrogen Council, emphasizes that only with robust hydrogen strategies can Germany strengthen its value chains and keep key industries operational. The Council’s demand for immediate publication of the Federal Government’s import strategy reflects the urgency of establishing a secure hydrogen supply chain.
