In their study on the European energy transition, researchers from the Jülich System Analysis have for the first time also included the decarbonization needs of air and sea transport in order to achieve greenhouse gas neutrality in Europe by 2050 in line with the Green Deal. Accordingly, the demand for green hydrogen for the production of synthetic fuels (Power to Liquid, PtL) is half higher than in previous studies.
The Jülich research team estimates that in 2050, Germany alone will need 700 terawatt hours (TWh) of hydrogen annually to produce PtL. This estimate takes into account the high efficiency losses in PtL production. The basic demand for hydrogen, which is needed for the decarbonization of industry, to cover periods of dark and cloudy weather, and for other applications, is in line with earlier studies in 2050 at around 400 TWh per year. Overall, it is expected that green hydrogen production in Europe in 2050 will require about 44 percent of electricity generation (4600 TWh).
However, institute director Detlef Stolten expects that from 2050 onwards, the direct, more efficient use of hydrogen via fuel cells will also increasingly come into play – at least in shipping – and that the high proportion of hydrogen for PtL production can thus be reduced again.
Strong together
To meet the high demand for green hydrogen and the correspondingly higher demand for renewable electricity, the Jülich research team is counting on the expansion of the European energy network. This could make Spain, Norway, Italy and Greece important hydrogen exporters for other European countries in the future. According to the study, the main customer is Germany, with an import quota of 77 percent (550 TWh, 2050), followed by the Netherlands.
Also see: Spain - DH2 Energy receives environmental permit for green hydrogen plant
However, a central prerequisite for such a European hydrogen market, with an estimated volume of 100 billion euros, is an even more massive expansion of renewable electricity generation in Europe. The study calculates that the expansion rates for renewables in Europe would have to be increased by a factor of five. The Jülich research team also emphasizes the advantages of a European network for renewable electricity, both for reasons of security of supply and economic efficiency. For Germany, a domestic electricity supply of 66 percent is forecast for 2050 (430 TWh of imports).
European hydrogen production competitive
The study concludes that Europe could cover its own demand for electricity and hydrogen at low cost. This would give Europe the option of securing its own supply without relying on imports from other countries.
European hydrogen production would be competitive up to an import price of 3.20 euros per kilogram in 2030. However, this would only apply if renewable energies were expanded more. Otherwise, the import of green hydrogen or its products would be necessary, which would increase the total costs by six percent compared to a European solution.
More transport networks and H2 storage
In estimating the costs, the Jülich researchers also take into account the need to expand the infrastructure, especially the transport networks and the interconnection capacities (between countries). For Germany alone, additional interconnection capacities of 90 gigawatts (GW) for electricity and 200 GW for hydrogen are estimated by 2050. Stolten emphasized that the implementation of existing grid expansion plans is now crucial as a first step.
Also see: IEA calls for more investment in grids and energy storage
In addition, hydrogen could be stored in salt caverns to bridge dark and cloudy periods and seasonal fluctuations in wind and solar power. According to the study, existing underground storage facilities for natural gas could be converted for hydrogen storage. Nevertheless, the construction of more than 50 TWh of additional storage capacity in Europe would be necessary, which would correspond to the construction of around 200 salt caverns, 80 of which would be in Germany.
Nuclear power too expensive
According to the analysis by the Jülich researchers, nuclear energy does not play a significant role in a secure, climate-neutral and cost-effective European energy supply. It is not competitive compared to photovoltaics and wind power, even when storage and increased transport costs are taken into account. This applies at least as long as the real investment costs for nuclear power plants do not fall below 6,600 euros per kilowatt (kW).
Subscribe to our montly investors newsletter
Even the newest Finnish nuclear power plant, Olkiluoto 3, is above this threshold at €6,875/kW. The French reactor Flamanville-3 is at €10,875/kW, and Hinkley Point C (Great Britain) is at €17,500/kW. Stolten emphasized that this calculation does not include the costs for disposal, which has not yet been clarified.
At a panel discussion held in Berlin to present the study “European Energy Transition - Germany at the Heart of Europe” of Jülich Research Center (Forschungszentrum Jülich), Stolten also recently expressed skepticism about the much-hyped Small Modular Reactors (SMRs). According to the Jülich institute director, it is not to be expected that these could be operated economically in Europe by 2050 with the appropriate safety standards. (hcn)
