opinion |  Low-carbon hydrogen: a demand that is not taking off!

opinion | Low-carbon hydrogen: a demand that is not taking off!

By Bruno Alomar (CEO of New Horizon)CEDRIC PERRIN (Vice Chairman of the Senate Foreign Affairs, Defense and Armed Forces Committee)

Posted Apr 13, 2023, 11:00 AM

Hydrogen, one of the solutions to the energy and environmental equation, is not new. It is already widely used in many industrial processes (steelworks, cement works, refineries, textiles, fertilizers, etc.). Its production, however, is carbonaceous, as it is mainly produced from methane.

Worldwide, hydrogen needs are around 94 million tonnes per year, or 2.5% of CO2 emissions.2 of the planet. In this context, the development of clean hydrogen, obtained by electrolysis, ie by fracturing the water molecule, is a priority.

Disappointing record

But where are we really? The results to date, if we are serious about the intentions, are disappointing: low-carbon hydrogen has not started to decarbonize the economy! France, proactive and technologically at the forefront in the EU, has an installed capacity in operation, able to generate low-carbon hydrogen, and therefore to participate in the reduction of greenhouse gas emissions, less than 20 MW, i.e. less than 0.3% of the 6.5 GW target set for 2030! In Europe, the installed base is less than 200 MW.

However, time is running out: there are still around 6 to 7 years to create and operate a complete hydrogen sector. It is not for lack, for the public authorities, to have mobilized.

The European Union, with the RePowerUE plan, has increased its objectives to more than 100 GW in 2030 (50% of projected global capacity). The Commission authorized the disbursement of 5.2 billion euros in aid under the PIIEC Hydrogen (important project of common European interest) and designed other funding formats, such as the Innovation Fund and the hydrogen.

French hydrogen sector

In France, a National Hydrogen Council was set up on January 11, 2021 with a strong objective, reaffirmed by Emmanuel Macron in Belfort: to structure a French hydrogen sector, sixty years after the creation of the nuclear sector. The major French energy players have also set themselves ambitious targets (3 GW respectively for Total, Engie and EDF by 2030).

Why, then, are the results so limited? The main difficulty is the slow acceleration of demand, ie the transition by industrial consumers from carbon hydrogen to low carbon hydrogen. The authorities have focused on production, freeing up significant resources.

But the development of the sector requires that demand be structured and “pull” uses. It is because demand will grow that electrolyser manufacturers will be able to scale up, perfect know-how, develop skills, make technologies more reliable which, as they stand, have not yet been tested. on a large scale, fueling buyer mistrust.

Crucial role of principals

Breaking this vicious circle of mistrust is a priority, and it is on the side of the major contractors that the efforts must be directed. The United States have understood this, which, through the IRA, emphasizes consumption. The EU has focused on production, forgetting moreover that it is a whole ecosystem that must be built.

In this context, the major energy players have a crucial role to play. Yesterday, the nuclear sector was structured around EDF, Framatome, Cogema. The major energy players have the financial means, and, at least as important, the technical means and the skills.

Unsubsidized private application

Without their mobilization, the producers of electrolysers, generally of small size, will not reach the critical size. For, in the end, it is the existence of unsubsidized private demand that is the sign of the viability of an industry.

The EU and France wished not to reproduce with hydrogen the past mistakes which led to leaving to others, in particular China, the leadership in terms of solar energy or batteries. There is an urgent need to accelerate in order to structure a European sector which today, due to a lack of projects carried out by volunteer leaders, is unable to really get off the ground.

Bruno Alomar is an economist.

Cedric Perrin is a senator for the Territoire de Belfort, a member of the Republicans.

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