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    E.ON says Germany needs legal framework to hit hydrogen goal

Summary

Germany will not meet its goal on developing a green hydrogen market by the end of the decade without a legal framework to reassure investors, one of the country's biggest utilities E.ON said on Wednesday.

by: Reuters

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E.ON says Germany needs legal framework to hit hydrogen goal

BERLIN, Nov 9 (Reuters) - Germany will not meet its goal on developing a green hydrogen market by the end of the decade without a legal framework to reassure investors, one of the country's biggest utilities E.ON said on Wednesday.

With participation from the Green Party, the German government last year updated plans to achieve 10 gigawatts of green hydrogen capacity by 2030.

Since then, economic turmoil and the disruption of gas supplies following Russia's invasion of Ukraine has forced Germany to resort to polluting forms of energy in the short term, while pursuing renewable fuel as a longer term goal.

Patrick Lammers, chief operating officer and board member at E.ON, said the company had signed outline agreements with providers and customers, but could not "focus investments" without a clear legal framework.

"It is not clear whether or not the creation of a new hydrogen market, away from a niche, is possible by 2030," Lammers told a web-cast press conference.

Produced using solar and wind power, green hydrogen has been embraced by industry as a way to replace millions of tonnes of "grey" hydrogen made with gas.

But an E.ON-sponsored study from Cologne energy research institute EWI found plans to build German electrolysis plants would achieve green hydrogen capacity of 5,607 megawatts (MW) by 2030, just over half the 10,000 MW (10 GW) the government wants.

For Germany, scarred by its over-reliance on Russian gas, an advantage of hydrogen is that it can be domestically produced, but the study implies the country would not be self-sufficient.

Another problem is a lack of infrastructure to import hydrogen.

Lammers said Germany needed to provide financial help for creating infrastructure, as well as a legal framework.

Legal challenges include addressing rules on unbundling that, applied to gas transport networks under European Commission proposals, would block joint operations of hydrogen and gas grids by the same company.

Lammers said this was preventing investment and acting as a disincentive to converting gas infrastructure to hydrogen. Climate campaigners, however, say the separation is a way to ensure new forms of energy are developed outside the influence of the fossil fuel incumbents.

(Reporting by Vera Eckert in Frankfurt, editing by Barbara Lewis)