(Berlin) - The federal government has updated the National Hydrogen Strategy (NWS) from 2020. The evaluation and further development after three years had already been determined at the time, and an update was also explicitly part of the coalition agreement.
The “Update of the National Hydrogen Strategy (NWS 2023)” is available free of charge as a PDF (34 pages, click on the image)
The current update sees as reported, proposes an increased pace in the development of the German hydrogen economy. Green hydrogen is the focus, but other hydrogen variants are also conceivable in the interim.
Numerous associations and institutions have commented on the update. Basic tenor: The revision is an important building block in achieving the climate goals, but in some cases it comes too late and implementation needs to be accelerated. The main criticism is that the potential of the green hydrogen that can be produced in Germany is not being exploited and that fossil sources and imports are receiving too much acceptance. We summarize a selection of opinions, concerns and desires. The complete wording of the statements is stored and can be accessed with a click.
VDMA: Don’t look at the hydrogen economy in isolation
The Association of German Mechanical and Plant Engineering eV (VDMA) calls for the development of the hydrogen economy to be accelerated. The revision also offers medium-sized mechanical and plant engineering companies “good opportunities to contribute their knowledge and skills, for example in the construction and operation of electrolyzers,” says Peter Müller-Baum, head of VDMA Power-to-X for Applications. However, the adjustment “must now be implemented at high speed”.
The hydrogen economy should not be viewed in isolation, but should be “sensibly merged with other elements of the energy transition”. It is “with concern” that the Federal Ministry of Economics is pursuing “a policy of small-scale regulation” instead of relying on free market freedoms and openness to technology. “This will not work in practice and will also hinder the development of the hydrogen economy.”
DUH: Missed opportunity for green hydrogen
The Deutsche Umwelthilfe (DUH) criticizes it as a failure to rely more on hydrogen from sustainable sources in the energy transition. With the strategy, the traffic light government is “missing the opportunity to clearly prioritize green technologies when restructuring energy systems”. The inclusion of fossil blue hydrogen in the paper is “a massive step backwards in climate policy”.
The federal government should have provided clear guidelines to switch solely to green hydrogen as a clean green technology option. “Instead, investments and even funding are now being channeled into blue hydrogen from fossil sources, which are missing for investment in green hydrogen,” complains the DUH. This enables the gas industry to produce additional fossil natural gas. “The phase-out of fossil natural gas is being postponed at the expense of climate protection.”
FZ Jülich: Sensible pragmatism
The Research center Julich (FZ Jülich) assesses the innovations in the NWS positively. It is interesting that “domestic production of hydrogen should be strengthened,” says Peter Wasserscheid, founding director of the Institute for Sustainable Hydrogen Economy (INW). The planned increase in hydrogen availability by increasing domestic electrolysis capacity and imports is “a strong signal”.
A hydrogen starting network with pipelines several thousand kilometers long is “important because it creates a hydrogen sales market and the producers and import ports can be connected to the large consumers in the country.” Accepting gray or blue hydrogen in addition to green is “sensible pragmatism”. This enables “a hydrogen economy to ramp up more quickly with acceptable side effects as long as there is not enough green hydrogen.”
PtX Alliance: Important building blocks are missing
The Power-to-X Alliance expressly welcomes the adjustment, but believes that “important building blocks are missing and the strategy must now urgently be followed by action.” A “pragmatic funding system supported by additional financial resources” must enable the production and use of green hydrogen and PtX products “across a wide range of applications”. What is needed is “a clear import strategy as quickly as possible” that opens import channels and promotes the expansion of infrastructure. It should be noted that “a perspective for hydrogen and PtX applications is secured in all sectors” and that no new dependencies arise.
The increase in the target for domestic electrolysis capacity is welcome. The accelerated expansion of the hydrogen network sends a signal to decisively tackle the development of climate-neutral business models. “Green hydrogen is a central building block for a climate-neutral economy. But hydrogen derivatives made from it, such as ammonia, methanol or eSAF, are just as important,” says association spokeswoman Melanie Form. In order for these products to be used, they would have to “become a widely available, affordable and globally traded commodity as quickly as possible.” However, the measures outlined were “missing central building blocks”.
Hydrogen Council: Don’t just rely on lighthouse projects
The National Hydrogen Council (NWR) sees the update as an “important milestone that the Federal Government is continuing to pursue the National Hydrogen Strategy with ambition”. Hydrogen has “immense importance in terms of industrial and technology policy,” says NWR chairwoman Katherina Reiche. “Only with hydrogen can we maintain value chains and ensure that key industries remain in Germany.” The transformation towards climate-neutral production and international competitiveness of German industry and small and medium-sized industrial companies depends “on the sufficient availability of hydrogen and its derivatives at competitive conditions “. Companies only invest if they have long-term planning security.
The US Inflation Reduction Act and similar regulations around the world would accelerate the development of comprehensive value chains on an industrial scale. “In view of the rapid progress made by other countries, the federal government should move away from relying exclusively on lighthouse projects.” What is more important is “creating effective incentives for the rapid scaling of the hydrogen economy and the development of new business models.” From the NWR's perspective, all technology options, heat pumps, heating networks, renewable heat and hydrogen are needed for a successful heat transition. “All technologies should therefore be anchored in the Building Energy Act as an equal fulfillment option and taken into account when expanding the infrastructure.”
LEE NRW: Hydrogen imports too one-sided
The North Rhine-Westphalia Renewable Energy Association (LEE NRW) finds the draft “disappointing”. He relies too “unilaterally on hydrogen imports instead of on domestic potential based on renewable energies”. An increase in electrolysis capacity is planned. The “problem of excessive dependence on energy imports” is also recognized, but the NWS draft draws the wrong conclusion: “Instead of focusing on domestic hydrogen production, the federal government continues to focus on expensive imports by ship,” says Managing Director Christian Mildenberger. In doing so, the NWS remains true to “the false assumption that there is little domestic potential for hydrogen production.”
LEE NRW also assumes that imports of hydrogen quantities will be necessary in the future. “But in the short term, domestic potential should be developed as a priority.” With regard to the expansion goals in the wind and solar energy sector, “there will always be situations before 2030 in which electricity generation significantly exceeds demand.” For this purpose, it is important to build up the appropriate electrolysis capacity. The production costs of hydrogen in Germany are below the costs of importing it by ship. In addition, the focus should be on the production of green hydrogen instead of promoting blue hydrogen, which is more harmful to the climate.
FNB Gas: Core network to start this year
The Association of Gas Transmission System Operators (FNB Gas) calls for “more speed” in the hydrogen core network. “We have to start construction this year,” demands Thomas Gößmann, CEO of FNB Gas. It is hoped that the investment framework will be clarified and “the changes to the Energy Industry Act will come into force in a timely manner in the autumn as a necessary legal basis”.
The further expansion stages of the hydrogen network, which take future hydrogen needs into account, must be “launched as quickly as possible” as part of a legally anchored integrated network development plan for hydrogen and gas. Overall, the strategy sets important guidelines for a “rapid development of the national hydrogen infrastructure and for its integration into a European network”.
MEW: Not ambitious enough
According to the Association of medium-sized energy companies in Germany (MEW), the update of the National Hydrogen Strategy is an “important building block for the ramp-up of the German hydrogen economy”. However, in many places the paper remains “not very specific and not ambitious enough”. Existing tank farms would also have to be included in the expansion of the infrastructure, “because they have enormous advantages, especially for storing liquid hydrogen derivatives, and can therefore reduce the need for investment in infrastructure projects.” Independent and medium-sized gas stations also play a “central role,” especially for commercial vehicles.
The increase in domestic electrolysis capacity is welcomed, but the time frame for the increased forecast for the demand for hydrogen and its derivatives is too short: “Companies need investment security beyond 2030 until the middle of the century, otherwise necessary investments will not be made,” says the association.
The announced import strategy is “of enormous importance”, must be “developed quickly” and strive for “a geographically broad import”. The MEW supports the technology-open approach. The focus remains on green hydrogen, but blue, turquoise and orange hydrogen are also being promoted. In addition, new funding instruments should stimulate the development of a hydrogen economy “significantly more than previously planned”, but should be usable “much faster and less bureaucratically”.
Wuppertal Institute: Timid and incomplete
The Wuppertal Institute for Climate, Environment, Energy gGmbH sees green hydrogen and its derivatives as “essential building blocks for the climate-neutral transformation of the economy and society”. The federal government should “raise the level of ambition for domestic hydrogen production” and examine to what extent the electrolysis expansion targets can be further increased. This is all the more true since the targeted domestic hydrogen production of 30 to 50 percent of the requirement can hardly be achieved with the planned electrolysis output. This requires system utilization levels that cannot be achieved in Germany using electricity from renewable energies; at least if the electrolyzers are to perform their system-serving function as planned.
Based on lessons learned regarding supply chain vulnerabilities, well-coordinated European hydrogen production should complement increased domestic capacity building. The federal government should focus primarily on derivatives when it comes to purchases from overseas. It is welcome to link the establishment of international hydrogen partnerships with a socio-ecological social and economic transformation in the supplying countries. Exactly how the federal government wants to comply with this remains unclear, “but it is crucial for long-term social acceptance and sustainable development”.
There are also open questions in many other announced areas, from the import strategy to a hydrogen acceleration law to the storage concept. “The federal government must now deliver promptly and specifically.” It is right to permanently rely only on green hydrogen and “to limit the contribution of blue or turquoise hydrogen only to the absolutely necessary amount for the ramp-up”. The use of green hydrogen should, at least in the ramp-up phase, be focused on the applications that are really necessary, such as steel and chemical production as well as electricity generation and, if necessary, heavy goods traffic.
However, widespread use of hydrogen in buildings and road transport is “inefficient and cost-intensive” and should not be pursued due to “the foreseeable physical shortages of hydrogen based on current knowledge”.
DWV: Initiate the Hydrogen Union
The German Hydrogen and Fuel Cell Association (DWV) appeals to the federal government to create “a concrete market design for the production, use and transport of green hydrogen”. It is “indispensable to know when, from where and in what quantities hydrogen can be imported into Germany”.
Although the association welcomes the update of the National Hydrogen Strategy, the cabinet decision is criticized by the hydrogen industry as “too vague and too unambitious”. The test orders for further measures contained in the NWS were not sufficient “to meet the upcoming challenges and international competition and to make optimal use of the economic opportunities of the hydrogen ramp-up”. The DWV calls on the federal government to initiate a “European Hydrogen Union so that Europe can largely cover its own hydrogen needs in the near future.”
Photos
The update of the National Hydrogen Strategy now presented by the Federal Government is expected to be met with controversy. © EBRD
Copyright of the logos
The copyright of the logos lies with the respective associations and institutions.
