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  • Dusan Mijailovic

Obstacles for the European Green Hydrogen Acceleration Centre

Green hydrogen, full of hope, but equally full of obstacles, is a rare example of a clean energy source that has not been fully realized yet. A recent European initiative aims to create half a million jobs and set up green hydrogen as a €100 billion industry by 2050, posing the question of whether the problems facing green hydrogen will be resolved for a generation?

So-called 'green' hydrogen has arisen as a possible source of alternative fuel for the future alongside conventional green energy sources, such as solar and wind power. This applies to electrolysis-produced hydrogen, the mechanism by which water is separated into hydrogen and oxygen, where green power sources provide the electrical force.

While this hydrogen gas supply is almost completely emission-free, the requirement to construct expensive electrolysers and introduce green hydrogen installations into the current renewable energy infrastructure has rendered the method unsustainably costly and, to the point of redundancy, logistically complicated. Numbers from the International Energy Agency (IEA) showed that the cost of generating green hydrogen could be $3 to $7.50 per kilogram more than three times the price of producing 'grey' hydrogen using natural gas. Furthermore, Wood Mackenzie study found that the production of green hydrogen is only 0.1% of the total world's annual production of hydrogen.

A recent European initiative, in view of these obstacles, could help green hydrogen achieve its enormous energy potential. Renewable energy investment centre EIT InnoEnergy introduced last year the European Green Hydrogen Acceleration Centre (EGHAC) which seeks to boost the growth of green hydrogen technologies and logistics by generating half a million new jobs in an industry worth €100bn by 2025.

However, can financial strength and lofty goals alone be enough to solve the green hydrogen industry's multiple challenges? It remains to be seen if the EGHAC will overcome the problems that have troubled green hydrogen for decades, with challenges ranging from a lack of technological advancement to an unwillingness to invest.

The scaling-up process is one of the biggest obstacles to all emerging technologies, not only green hydrogen. A transition from solely scientific and technological problems to logistical, economic, and, in some cases, political ones entails going from small-scale demonstrations of viability to large-scale industrial processing.

Similar to the prohibitive start-up costs of creating green hydrogen solutions, the alleged loss of financial returns from investing in technology has discouraged investors from funding projects based on this technology.

Although green hydrogen and other clean energy sources are both striving for the same end goal, there is a notion that large-scale implementation of green hydrogen is an inherently flawed idea because it will divert other renewable energy products from producing electricity.

On a continent-wide scale, there is a question of efficiency: why invest in renewables to fuel green hydrogen, when one could invest directly in renewables?

To address this obstacle, the EGHAC is aiming to take advantage of a mixture of rising demand for renewable energy and declining prices of green hydrogen. IEA numbers indicate that the existing European wind and solar capacity is just over 300 GW, an ambitious amount, but well below the 700 GW total capacity needed to meet the EU's 2030 energy mix goal of two-thirds based on renewable energy.

The need for quick transition in the continent's energy systems could fuel investment in and foster promising but unproven solutions, such as green hydrogen, as Europe is running out of time to achieve its objectives.

In addition, Wood Mackenzie estimates suggest that by 2040, the cost of generating green hydrogen could drop by as much as 64 percent, a drastic decrease that would reduce the high start-up costs of green hydrogen, a barrier not shared by other renewable energy sources.


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