Imported hydrogen to undercut EU production costs by 2030, study says

The cost of imported clean hydrogen, a future energy source intended to replace fossil fuels, into the European Union will be competitive by 2030, Aurora Energy report says.

By the end of the decade, according to RePowerEU strategy, the EU would consume 20 million tonnes of hydrogen annually, half of which will come from imports of hydrogen from carbon-free sources like wind and solar power, according to Aurora.

The region’s focus on energy security has been intensified by the conflict in Ukraine, and the usage of green hydrogen produced from renewable electricity is consistent with the region’s climate goals.

In a case study, Aurora estimated that by 2030, the cost of producing clean hydrogen in Germany will range between 3.9 and 5 euros ($4.23-5.43) per kilogram.

According to recent studies, the price of hydrogen produced using green power currently ranges between 6 and 8 euros in Northern Europe.

According to the business, at this price, Australia, Chile, and Spain could produce it for 3.1 euros per kilogram, Morocco for 3.2 euros per kilogram, and the United Arab Emirates for 3.6 euros per kilogram.

Aurora analyzed the presumptive costs associated with production, conversion to alternative energy sources, and transit via ship, pipeline, or vehicle.

The cheapest form of transportation, pipeline, favors sunny Spain and Morocco as suppliers to businesses further north, according to Aurora’s conclusions on modes of transportation.

Germany said last weekend that it would join the H2Med hydrogen pipeline that Spain laid out in full last month. H2Med would link eastern Spain and southern France. According to Aurora, Morocco would ideally be reached by the pipeline as well.

Using liquid organic carriers (LOHC) or ammonia to bind hydrogen for reconversion at the destination would be much more expensive, according to Aurora, and would be 20% more expensive than transit via the pipeline.

However, by 2030, the range of estimated domestic production prices might be reached by ammonia imports by sea, delivering hydrogen from Chile and Australia to Germany.