Green hydrogen: from concept to center stage solution

Energy has become the central issue on the political, economic, and social agenda in the European Union. Never before have our present and future been so closely linked to the functioning of the #energy system and the need to find new sources of clean energy and greater energy autonomy.

The social concern about the cost and availability of energy is keenly felt by all and demands sound and long-term responses from the public and private sectors. The challenge is enormous: ensuring energy security and independence while continuing to accelerate the fight against climate change.?

But with great hardships come great opportunities. Green hydrogen, as discussed last month at the Euro-Mediterranean summit in Alicante , is both a solution and an opportunity for Europe. As European Commission President Ursula von der Leyen said at the summit, #greenhydrogen is a new energy vector that will change this continent’s history by becoming a crucial part of our energy system.

The challenge may be enormous, but it comes with the opportunity of turning Spain into an energy-exporting powerhouse and a global leader in the energy transition

#Spain has a fundamental role to play in this new energy system. Thanks to its abundant sun, wind, and space, it has the critical elements for producing green hydrogen, the best clean solution to decarbonize industry and heavy transport.

Spain is the fifth greatest producer of wind energy and eighth of renewable generation worldwide, and 20% of all green hydrogen projects worldwide are Spanish. I dare say that Spain could become the new Gulf of green hydrogen, with the capacity to export to the rest of the continent and also attract new industries searching for clean and cheap energy. This would transform its traditional balance of energy payments.

But developing a new #hydrogen market requires rapidly moving from commitments to action. In Spain, more than 80% of hydrogen projects are in very early stages (either in feasibility studies or in the permitting phase). We must be swift because others are moving quickly in this global race, where many countries’ geostrategic interests are at stake. In the case of the U.S., the recently-passed U.S. Inflation Reduction Act and the Bipartisan Infrastructure Act will provide more than $20 billion in support for the green hydrogen industry, with a significant “Made in America” component.

Here are some of the key actions needed to develop a new renewable hydrogen market:

1.????Hydrogenise demand, replacing in the short term the use of grey hydrogen with green hydrogen in refining and fertilizer production activities, and stimulating demand in industry and heavy and maritime transport. This requires making green hydrogen competitive, through measures that reduce the cost of renewable electricity, which comprises 80% of the production cost. Financing schemes under the Recovery Funds and other EU mechanisms such as the Important Projects of Common European Interest (IPCEI ) are a step in the right direction, but risk falling short when compared to steps taken on the other side of the Atlantic. Other measures could include trade policies that address carbon leakage in certain industries (such as the border carbon fee currently under discussion), quotas and mandates for green hydrogen used specifically in transportation, alignment with industrial R&D funding, and, finally, public procurement or eco-labeling of green materials produced with #renewable hydrogen.

2.????Promote robust, specific, and long-term policies and regulations to help hydrogen producers carry out projects. This can be achieved by providing producers access to sufficient and competitive renewable electricity and streamlining the permitting for such access. Another step would be to facilitate administrative processes for hydrogen production facilities and, as a matter of urgency, for solar and wind renewable generation schemes. A series of regulations must also be adopted to certify that green hydrogen is indeed #green . The recently passed guarantee of origin legislation is a step in the right direction.

3.????Strengthen interconnections. The timely commissioning of infrastructure, including power transmission facilities, must be ensured. It is necessary to continue to work with all stakeholders on grid planning and on the governance of future hydrogen networks. In this regard, the announcement of the construction of a new pipeline between Barcelona and Marseille is great news for the long term. In the short term, sea corridors must be promoted. In this sense, we will see more so-called hydrogen diplomacy in the coming years, intensifying collaboration between the countries around us.?

4.????Favor volume to create economies of scale. The more projects there are, and the bigger they are, the better. To this end, collaboration and investment attraction must be strengthened. We need large conglomerates, SMEs, component manufacturers, engineering firms, universities, researchers, entrepreneurs, and service providers. Above all, Spanish entrepreneurs must step up to lead this industry. Their input will be vital in developing the entire value chain, thereby generating a new integrated market.

5.????Facilitate project financing and supporting investment and RD&I efforts. Aid should be directed to subsidise, not so much the purchase of equipment, but the costs of hydrogen production and fiscal aid. If we want to win this hydrogen race, we must encourage all players – companies and administrations – to collaborate at the local, national, and European levels.

These are far-reaching, complex measures that require a tremendous collective effort, but this is something that can transform the #European economy and society in the coming decades. We are talking about attracting and developing a new industry, promoting sustainable transport by land, sea, and air, and creating quality jobs. In short, we are talking about turning Spain into an energy-exporting powerhouse and a global leader in the #energytransition .

Original source Diario EL PAíS : https://elpais.com/economia/2023-01-09/hidrogeno-verde-pasemos-de-las-musas-al-teatro.html