The Hydrogen Stream: 2.7 GW of operational electrolyzer capacity expected for Europe by 2025
According to two new pieces of research, Europe is on track to reach 2.7 GW of operational hydrogen electrolyzer capacity by 2025 and most of this capacity is expected to be located in Germany. Furthermore, three European gas associations have assessed the competitiveness of the different transportation options for hydrogen and have found it depends on the distance over which hydrogen is transported, as well as on scale and end-use.
Edinburgh-based energy market research consultancy Delta-EE has written that Europe is on track to reach 2.7 GW of operational hydrogen electrolyzer capacity by 2025. This is mostly because of EU public support coming from the EU green deal and the IPCEI Hydrogen initiative. “However, time is running out to establish the many projects on the hundreds of megawatts scale required to achieve an EU target of 6 GW by 2024,” the company stated.
According to the Scottish consultancy’s new Global Hydrogen Intelligence Service, nearly half of all European electrolyzer capacity is in Germany while no other country has more than 10 MW installed. “The sector is expanding fast; the first major projects in several countries (e.g. Spain, Netherlands, Denmark) will be at the tens of megawatts scale in 2021/22 and will soar towards the hundreds [of] megawatts by 2025. A key factor in this growth will be the increase in manufacturing capacity of electrolyzer manufacturers,” the company explained, mentioning Nel Hydrogen, ITM Power, Cummins and McPhy, which “are all building factories capable of producing hundreds of megawatts, if not gigawatts of electrolyzers a year.”
The competitiveness of the different transportation options for hydrogen depends on the distance over which hydrogen is transported, as well as on scale and end-use, according to the European Network of Transmission System Operators for Gas, ENTSOG; the European association of gas infrastructure operators, GIE; and Hydrogen Europe, a European association representing the interest of the hydrogen and fuel cell industry. “If hydrogen needs to be shipped overseas, it generally has to be liquefied or transported as ammonia or in liquid organic hydrogen carriers (LOHCs). For distances below 1,500km, transporting hydrogen as a gas by pipeline is generally the cheapest delivery option; above 1,500km, shipping hydrogen as ammonia or a LOHC may be more cost-effective,” wrote the three European associations last month in a report. They see, in blending, “an easy entry point into the hydrogen economy,” defining it as a cost-effective transitional option, despite the modifications and related investments needed, especially for compressors. “Different compressor models react in different ways to hydrogen blends,” reads the report, explaining that the needed investments will also depend on the share of hydrogen.