Rahman, S. R. S. (2022). To what extent can the European Union’s vision of electrolyser deployment as communicated in ‘A hydrogen strategy for a climate neutral Europe’ be realised? [Master Thesis, Technische Universität Wien]. reposiTUm. https://doi.org/10.34726/hss.2022.101888
Hydrogen; Electrolyser; European Union; Strategy; Deployment
The European Commission published its hydrogen strategy in July 2020, in which it articulated its priority to establish a value chain to produce green hydrogen using and electrolytic process using renewable electricity. Green hydrogen is seen as being an essential element in meeting the Commission climate neutrality goals, and the energy vector necessary to decarbonise the hard to abate areas such as industry and transport. The strategy outlined three phases of implementation. The first phase,between 2020 and 2024, sets a production of 1 million tonnes of hydrogen from an electrolyser capacity of 1 GW, to de-fossilise existing hydrogen applications. A production target of 10 million tonnes from 40 GW of electrolysers is fore seen by the second phase between 2025 to 2030. Here, demand is seen to diversify into new areas of application. Beyond 2030, green hydrogen is seen to available at scale and utilised in all areas where feasible. By 2050, hydrogen is expected to make up between 13%-14% of the final energy mix, consuming up to 25% of the available renewable electricity.The objective of this work is to examine to what extent the European Union’s electrolyser deployments targets published in its hydrogen strategy can be met by analysing green hydrogen demand, the availability of renewable electricity and electrolyser supply factors. An extensive literature search of up-to-date peer reviewed journals, industry and commercial reports, databases, white papers and articles was undertaken to collect data, examine trends and make inferences. The results were summarized and modelled to generate two levels of scenarios, a ‘High’ scenario conveying an optimistic view and a ‘Low’ scenario with a minimal development viewpoint. An analysis of hydrogen demand including sectoral requirements for industry and transport led to the development of the green hydrogen demand scenarios. The Low green scenario sees a demand of 220 TWh in 2030, rising to 950 TWh in 2050. While in the High green scenario demands of 280 TWh and 2,600 TWhare seen respectively. Using these, renewable electricity requirements for electrolysis was calculated. The Electrolyser RE Low scenario showed a requirement of 314 TWhin 2030, rising to 1,188 TWh in 2050. While the Electrolyser RE High required 400TWh and 3,250TWh respectively. An analysis of renewable electricity projections was used create scenarios for the availability of renewable electricity for electrolysis. The Low RE for electrolysis scenario showed 208TWh in 2030 which rose to 1,568TWh in2050, while the the High RE for electrolysis scenario required 612 TWh and 2,451TWh respectively. A comparison of the electrolyser requirements and the availability of renewable electricity for electrolysis revealed that in the Low green scenario there is a shortfall in requirements until 2034. In the High green scenario, a deficit was seen to grow from 2034 onwards. A deep dive into the status of electrolyser technology revealed that technology costs are rapidly declining and learning rates for the sector have possibly been underestimated. Manufacturing is being scaled up with capacity growing from 1 GWto a projected 18 GW by 2024. This has meant that the outlook for the levelised cost of hydrogen is falling fast. Some industry expects that parity with other low carbon alternatives can be achieved as early as 2025, in some areas, with a sub $1/kg cost expectation by 2050. With this as a backdrop the pipeline of hydrogen production projects has grown rapidly reflecting a growing confidence in the sector. It is expected that the quantum of projects that will finally be implemented will exceed the electrolyser capacity deployment targets set out in the hydrogen strategy. Furthermore, electrolyser supply in unlikely to be a limiting factor going forward and the availability of renewable electricity emerges as the key barrier in the development of the hydrogen economy. With competing needs of renewable electricity for direct electrification, the additional renewable electricity required for electrolysis must be sufficiently made available to support the ambition laid out in the hydrogen strategy. While there is ample potential for renewable energy in Europe, its deficiencies in its permitting and procedural processes have in the past slowed down build-out, and must be addressed, if Europe wants to achieve carbon neutrality goals by 2050.