A pilot plant for producing green hydrogen energy for low-emission production of chemicals and fuel has opened in the German state of Saxony-Anhalt, the Fraunhofer Centre for Chemical-Biotechnological Processes (CBP) says.

The plant, in the town of Leuna, should provide clean hydrogen energy for firms operating in Germany’s “chemical triangle.” The plant works by using photovoltaic or wind power sources to generate hydrogen from water through electrolysis, resulting in a climate-neutral product, Fraunhofer CBP said in a statement.

Markus Wolperdinger, head of the Fraunhofer Institute for Interfacial and Biotechnology (IGB) said that the platform should show the technical and economic possibilities of using green hydrogen as a raw material in the sustainable chemical industry “and prepare the way on a large industrial scale for green hydrogen to become marketable.

Green hydrogen, made with water and renewable power, has increasingly been presented as a silver bullet technology to clean up CO2-intensive sectors such as steel and chemicals production.

Germany has set out to become a global leader in the associated technologies, penning a National Hydrogen Strategy.

Over two dozen projects in northern Germany have also been promoted to show how hydrogen can play a key role in the energy transition. But high costs have so far stood in the way of a major deployment of the technology, and uncertainty still surrounds much of the industry framework.