For once, the problem is not the funds, nor what is perceived around the theme. «That the hydrogen revolution will happen is now a certainty, it remains to be defined how, where and when», begins Mario Paterlini, president of the Hydrogen energy vector group, one of the three product groups of Assogastecnici – the Federchimica association that brings together companies in the field of production and distribution of technical, special and medicinal gases and represents 95% of the national market – and CEO of the Sapio group. «Today 40 countries have a structured hydrogen plan and in the last two, three years, investments have reached 100 billion dollars. This is because hydrogen (which is not an energy source, but a vector, capable of storing and supplying energy without producing CO₂ emissions, ed) reconciles energy independence, the nearshoring of industry (the relocation of business activities to a neighboring country) and the decarbonisation of sectors ranging from mobility, to industry, up to infrastructure», explains Paterlini. It’s Italy? “We are witnessing a large fragmentation of initiatives, but a national strategy has not yet been decided that clearly directs producers and investors”. In fact, the Pnrr contains eight measures, two of which are regulatory and six infrastructural, to encourage the production of green hydrogen and favor its penetration in the industrial and transport sectors, for around 3.6 billion in investments. Paterlini continues: «The first requirement for developing a competitive supply chain with fossil fuels is to have a large availability of low-cost renewable energy (and Italy is at a standstill on its photovoltaic installation targets, see page seven for details), and then have incentives, not only linked to the initial investment but also to the operating costs of the production plants, as the USA has done, with the Clean Hydrogen Production Tax Credit. We have decided to develop a proposal, which we will present to the government, to introduce direct support for opex of hydrogen projects’.
The critical points of the Italian plan
“The strongest critical issue is the coupling between the production capacity from renewables and the need to make further investments related to electrolysers”, adds Davide Chiaroni, deputy director of Energy & Strategy of the School of Management of the Milan Polytechnic. The Energy&Strategy Hydrogen Innovation Report 2023 puts Italy’s modus operandi into perspective: 24 projects out of a European total of 631; 1.97 GW (gigawatt) of electrolysis capacity, against 93.55 for the EU. This is compared to the five GW foreseen in the guidelines for green hydrogen.
The report highlights how, in contrast with other areas, 63% of the planned Pnrr funds have already been allocated. now, it’s a matter of putting strategy into focus. «In this period of review of the Pnrr we are talking about, to identify the largest and most strategic investments – continues Chiaroni -. Hydrogen could very well play this game. For example, if it were decided to build two, three large-scale production hubs, on the US and Australian model, even in addition to the hydrogen valleys (see box above), which cannot meet the needs of the entire territory. Although the Italian plan is for five GW of electrolysers by 2030, 15 are estimated to be necessary, with a view to contributing to the country’s carbonization strategy. To reach them, about 180 projects similar to the valleys currently financed would be needed».
Storage and transport
The Energy & Strategy report outlines a picture of the technologies available for the transport and storage of hydrogen, which present a good degree of technological maturity. Also in this case – continues Chiaroni – it is essential to focus on the Italian strategy to understand which one would be better to focus on. «If the focus is on the transition to hydrogen of the old fossil fuel railways or industrial sectors hard to abbot, those that use fossil fuels as an energy source and are difficult to electrify, it makes sense to create a concentration of production in those areas by road transport or, better, by pipeline”. It’s the most complex route, because it involves a conversion of gas pipes, but it’s the one that best enables Italy’s role as a potential hydrogen transport hub towards Europe. In other cases, one could think about local networks. If you have an area dense with production activities, already reached by a gas distribution network, you could only act on that in a localized and intelligent manner.
With regard to storage, the conversion of hydrogen into ammonia and its subsequent re-hydrogenization greatly reduces the complexity of the operation and optimizes its management.