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A historic day for the EU’s hydrogen industry: An electrolysis boom is on the way

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Business and the EC have declared a commitment to a tenfold increase in production capacity in Europe

Manufacturers of electrolytic cells in Europe have committed to increase their production capacity tenfold – to 17.5 GW per year by 2025. This is part of a joint declaration with the European Commission, which was presented in Brussels recently.

The joint declaration was agreed at a summit on electrolysis issues in Brussels and was signed on May 5th by 20 chief executives of the industry along with EU Internal Market Commissioner Thierry Breton, Euractiv reported.

“Today, the industry has agreed to a tenfold increase in the capacity of electrolytic cells in Europe. The Commission will support this important industrial boost for industrial leadership in clean energy technologies of the future,” Breton said. The increase in capacity will allow the annual production of 10 million tonnes of renewable hydrogen in Europe by 2030, the Commission said in a statement.

The goal is in line with plans presented in March by the EU executive to end the EU’s dependence on Russian gas “long before 2030”. and accelerating the transition to clean energy sources.

To support the rapid growth of the industry, the joint declaration includes a commitment from the EU executive to put in place a supportive regulatory framework, facilitate access to finance and promote efficient supply chains.

The joint statement said this included “a legislative proposal to speed up the issuance of permits for renewable energy projects” and a faster review of state aid notifications sent to Brussels. Manufacturers of electrolytic cells, for their part, are committed to applying only for high-quality project proposals that are fully in line with the EU’s climate goals.

Jon Andre Locke, CEO of Nel Hydrogen and President of Hydrogen Europe, called it a “historic day” for the EU electrolysis industry. “It is time to bring the talks to action,” he added on Twitter, warning that there would be no “acceleration of electrolysis production in Europe without adequate regulatory and financial support.”

The EU is a world leader in the production of electrolyzers. Although China-made electrolyzers are cheaper, they are also considered less efficient and reliable than Chinese manufacturers themselves, according to Recharge.

“German and European companies are in an excellent position to produce key components for the value chains of the hydrogen economy – vehicles, transport solutions, cells, fuel cells,” said Veronica Grimm, an economist who is a member of the Hydrogen Council in Germany.

Bosch, the German industrial giant, is among the companies in the best position to compete in the global electrolysis market. Earlier this week, the engineering and technology company announced a 500m-euro investment in research into hydrogen cell components.

Hydrogen will be essential for Europe’s future economy, especially for storing and transporting green energy. This was stated recently before the European Parliament by the Executive Vice President of the European Commission for Climate Affairs Frans Timmermans. “I strongly believe in green hydrogen as the driving force of our energy system of the future,” Timmermans said at a meeting with the European Parliament’s environment committee, Euractiv reported.

“Hydrogen will be a key element in our economy of the future,” he added in a discussion on the impact of the war in Ukraine, the state of new European climate legislation and food security.

The European Commission is proposing long-term partnerships that will start with the supply of LNG and “end in the hydrogen economy”, Timmermans said. “Does this link our long-term to LNG supplies? Not if we offer long-term cooperation projects that switch to hydrogen,” he explained.

Timmermans envisions a hydrogen economy around the Mediterranean, where each country is dependent on the other and each has a “share in this production, distribution and use of green hydrogen”. “This is the future,” Timmermans said. “In this way, you also create more stability in the geopolitical system. This is how you offer a huge opportunity for the development of Africa.”

Europe “will never be able to produce enough hydrogen of its own,” Timmermans said. He added that green hydrogen produced from renewable energy is the European Commission’s preferred option, but blue hydrogen produced from fossil gas with carbon capture and storage to tackle emissions would also be a temporary option.

The EU is already looking beyond its borders when it comes to future supplies of renewable hydrogen.

The ideal case would be to transport renewable electricity by cable from European partners in the EU, but when this is not possible, energy can be stored in hydrogen or ammonia and transported to Europe. It would also provide more green hydrogen for the EU to help decarbonise difficult electrification sectors, including aviation and heavy industry.

But others are less convinced of the hydrogen future. During the meeting, centrist MEP Nils Torvalds warned of the “hydrogen boom” being talked about in Europe, citing reports of its leaks into the atmosphere and its impact as a greenhouse gas.

A study by the UK’s Department of Business, Energy and Industry warns that hydrogen is estimated to be at best six times worse than CO2 for a climate over a 100-year period.

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