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What’s the deal with the EU hydrogen energy strategy?

28 July 2020 

Earlier this month, the European Union announced its Hydrogen Strategy. It was both welcomed and criticised the bloc over. 

Essentially, the strategy is a roadmap for the mass production and integration of hydrogen energy. It’s seen by many as a key policy cornerstone of making the region “climate neutral” by mid-century. 

But what exactly is hydrogen energy? What challenges does it face, and why did some organisations raise the alarm about the strategy in its current iteration? 

Luckily, I had Professor Barry McMullin from Dublin City University’s School of Electrical Engingeering talk me through it. 

Here we go. 

Okay – but first, I need a crash course. What is hydrogen energy? 

Technically speaking, it is a “clean fuel”, meaning it does not produce carbon dioxide when used. It does produce a small amount of air pollution, but all in all, it is much better than fossil fuels. 

However, the catch here is that its production is still predominantly dependent on fossil fuels like coal and natural gas. When produced by the latter, it’s referred to as “grey” hydrogen. 

Let’s take electrolysis hydrogen production as an example, or what’s also known as “green hydrogen”. In lay person’s terms, this is when we separate the two elemental components of water from each other, hydrogen and oxygen, and voila, there’s your hydrogen ready for some non-CO2-producing use. 

But, here’s the climate catch: something’s got to power that chemical separation, and in many cases, that power is coming from a fossil fuel source. 

According to the EU, hydrogen production from fossil fuel powered processes generates anywhere between 70 to 100 million tonnes of CO2 a year. 

In addition to its current greenhouse gas contribution, it’s also not anywhere near the scale of production policymakers want it to be. 

The challenge, therefore, for the EU is twofold: they’ve got to fully decarbonise its production and do it on a large enough scale to meet the energy needs of the bloc. 

Right, so how do we do that? 

Well, there’s a lot of different elements in this, chemistry pun not-intended. 

In terms of getting enough renewable electricity to decarbonise hydrogen and all the while keeping it cost-efficient, this picture is looking rosier by the day.  

Renewable electricity is cheaper than ever before and by 2030, it is anticipated to be cost-competitive with fossil-based hydrogen. Battery storage for renewable electricity is also now on much better footing, so we have a way to store it too. 

There’s also an argument to be made from a self-sufficiency perspective for renewable-powered green hydrogen on our own home turf. 

Hypothetically, according to Professor McMullin, if we produced our own hydrogen energy from natural gas, not only is that bad for the climate because of the subsequent fossil fuel usage, it also has us depending on gas imports. 

“Whereas if we produce hydrogen from wind and solar that’s produced indigenously, that would create a secure supply of hydrogen that we don’t need to rely on imports for,” he explains. 

And we could even use renewable green hydrogen and store it for a relatively low cost for when we have any gaps in renewable energy production, namely when the air is still or the sun isn’t shining. 

The reason being is that while battery storage for renewable energy has certainly improved, it right now only financially makes sense to use batteries to, “smooth out fluctuations over a short time period”, Prof McMullin finds, specifically 12 to 48 hours at a stretch. 

The storage and later use of hydrogen isn’t susceptible to these tight time constraints, so it’s a good fallback if we have a couple of weeks without enough wind or solar power. 

And if we followed that strategy of clean, green hydrogen production and store it to be used as an energy buffer, according to Prof McMullin, it “quickly becomes more cost effective, even on today’s cost, than battery storage”. 

So that’s all well and good for decarbonisation, but what about deploying it at scale?

So, here’s the thing with getting things up to scale in terms of energy production. The only way to do it is to fork out a lot of money upfront, which will initially be expensive but the investment will help you meet future demand and it will make things more cost efficient in the long-run. 

We’ve seen a similar problem before with wind and solar energy in their early days, according to Prof McMullin. 

“So there’s a bit of a catch 22. Until we scale up in hydrogen energy it will be expensive”, he tells us, and we can’t deploy it properly right now, because it’s expensive. 

Still with me? 

But, with mass investment, we could solve the problem of scale. And so far, the bloc is making a considerable amount of noise for widespread financing through multiple avenues, including Next Generation EU, the European Regional Development Fund, the Cohesion Fund and the ETJ Innovation Fund. 

But wasn’t there some concerns raised about this strategy when it was announced? 

Yes, there was. Environmental groups in Europe raised concerns over the strategy’s potential to lock in additional fossil fuel emissions. 

The strategy itself says that “appropriate support” will be needed for low-carbon produced hydrogen as the bloc transitions to renewable hydrogen, and the Commission estimates that fossil gas will, “still account for 15 per cent of Europe’s energy mix in 2050 – the year the EU is meant to go climate neutral,” the European Environmental Bureau said in response to the announcement. 

Any investment in fossil-based hydrogen runs the risk of making “truly clean and fossil-free hydrogen uncompetitive for the EU market and creating stranded assets,” according to EEB senior policy officer Barbara Mariani. 

CAN Europe warned that it could keep a “door open for the use of dirty fossil fuels” and notes that it fails to provide a locked-in date for a phase out of natural gas. 

So, there’s a lot in play here going forward with hydrogen energy. Will we be able to decarbonise it fully and in line with existing climate constraints? We will make the necessary investments to deploy clean hydrogen at scale? And will it open this aforementioned door to fossil fuels? 

Time will only tell. But we’ll be keeping our eye on it and will look into all the developments as they come. 

A big thank you to Professor Barry McMullin for taking the time to explain all the intricacies of hydrogen energy to me. You can find lots of helpful information on decarbonsiation and complex systems on his Twitter account, so why not give him a follow