Editorial: Covid-19 reinforces “Made in Europe” sentiment [GasTransitions]
For some years now frustration has been growing in Brussels and across Europe at what are regarded as “unfair” trading practices by major trading partners such as the US and China. Grudler gave the example of rail transport. “Chinese trains come to Europe, but China is closed for our trains,” he said. “That’s not fair competition. We demand reciprocity.”
The Covid-19 crisis, having painfully laid bare the vulnerabilities of international supply chains, will no doubt reinforce this “made in Europe” sentiment, as Grudler’s pronouncements suggest. Bart Biebuyck, head of the EU’s Fuel Cell and Hydrogen Joint Undertaking (FCH JU), probably the world’s largest hydrogen R&D programme, expressed similar views in an exclusive interview with Gas Transitions.
Europe “is determined to keep its three-year lead in hydrogen” and “to keep the hydrogen jobs at home,” said Biebuyck, who is one of the key hydrogen policy advisors in the EU. “We don’t want to make the same mistake we did with solar panels and batteries,” he stressed. In the past, Europe established an early lead in solar PV and battery technology, thanks in particular to generous German subsidies, only to see manufacturing jobs in these sectors move to China and other Asian countries.
Similarly, the newly established industry association UK Hydrogen Taskforcebelieves the UK has the potential to become a major producer of hydrogen and even exporter of hydrogen technology. “The main thrust of our effort is indigenous production,” said a spokesperson to Gas Transitions.
The question is how realistic these ambitions are. The promotion of renewable energy, which has always been viewed in Europe not just as a climate policy but also as a way to reduce import dependency on fossil fuels, has arguably only led to increased dependency. Europe is now not just dependent on Russia and the Middle East for its oil and gas, but also on China for the supply of critical raw materials and batteries used in solar and wind installations and electric vehicles.
A European “hydrogen economy” will lead to yet other dependencies. If the hydrogen is to be “green”, which is what European policymakers insist it should be, at least in the longer term, Europe will in particular need huge supplies of renewable energy, which it can’t possibly source domestically.
Germany for one has already accepted that, to realise its decarbonisation goals, it will need to import green hydrogen on a massive scale. Even Greenpeace in Germany has come to the conclusion that a massive expansion of renewable energy production will enable the country to produce no more than a quarter of the hydrogen it is going to need. The rest will have to be imported.
One option for Europe is to import green hydrogen from far-away Australia, but that would entail transport by ship, not the most efficient manner. An alternative is suggested in a new report from industry association Hydrogen Europe, namely to turn to Europe’s neighbouring regions: North Africa, the Middle East and Ukraine. These have huge potential supplies of renewable energy which could be converted to hydrogen on location, and then transported to Europe by pipeline. This is much cheaper than by ship and also many times cheaper than transporting the renewable power through electricity cables.
How feasible this project will turn out to be is difficult to say. What is clear, however, is that although the time of naive Europe may be over, the time of European energy imports is not, and probably never will be.