Policy & Socio-Economics

Purpose: The policy module of the FCHO presents an overview of EU and national policies across various hydrogen and fuel cell related sectors. It provides a snapshot of the current state of hydrogen legislation and policy. https://www.fchobservatory.eu/observatory/policy-and-rcs/eu-policies https://www.fchobservatory.eu/index.php/observatory/policy-and-rcs/nationalpolicies Scope: While FCHO covers 38 entities around the world due to the unavailability of some data at the time of writing this report covers 34 entities. The report reflects data collected January 2021 – May 2021. Key Findings: Hydrogen policies are relatively commonplace among European countries but with large differences between Member States. EU hydrogen leaders do not lag behind global outliers such as South Korea or Japan.

Purpose: The standards module of the FCHO (https://www.fchobservatory.eu/observatory/Policyand-RCS/Standards) presents a large number of standards relevant for the deployment of hydrogen and fuel cells. The standards are categorized per application enhancing ease of access and findability. The development of sector-relevant standards facilitate and enhance economies of scale interoperability comparability safety and many other issues. Scope: This report presents the developments in European and international standards for the year 2021 and the start of 2022. Standards from the following standards developing organizations are included: CEN CENELEC ISO IEC OIML. Key Findings: The development of sector relevant standards on an international level continued to grow in 2022; on a European level many standards are still in the process of being drafted. In 2021 & 2022 11 new standards have been published on the subject of fuel cell technologies and safety and measurement protocols of hydrogen technologies. The recently established committee CEN-CLC JTC 6 (Hydrogen in energy systems) has not published standards yet but is working on drafting standards on for example Guarantees of Origin. In the upcoming years multiple standards will be replaced such as the ISO 12619 1-12 set of standards affecting 40% of all collected standards. Previous Reports: The first report was published in September 2020 followed up by a second report in 2021. This report is the 3 rd Annual report.

This paper analyses which sources of low-carbon hydrogen for the Northwest European market are most competitive taking into account costs of local production conversion and transport. Production costs of electrolysis are strongly affected by local renewable electricity costs and capacity factors. Transport costs are the lowest by pipelines for distances under 10000 km with costs linearly increasing with distance. For larger distances transport as ammonia is more efficient with less relation to distance despite higher conversion costs. The most competitive low-carbon hydrogen supply to the Northwest European market appears to be local Steam Methane Reforming with Carbon Capture and Storage when international gas prices return back to historical levels. When gas prices however remain high then import from Morocco with electrolysis directly connected to offshore wind generation is found to be the most competitive source of low-carbon hydrogen. These conclusions are robust for various assumptions on costs and capacity factors.

With its ability to store and transport energy without releasing greenhouse gases hydrogen is considered an important driver for the decarbonisation of energy systems. As future hydrogen import prices from global markets are subject to large uncertainties it is unclear what impact different hydrogen and derivative import prices will have on the future German energy system. To answer that research question this paper explores the impact of three different import price scenarios for hydrogen and its derivatives on the German energy system in a climate-neutral setting for Europe in 2045 using three different energy system models. The analysis shows that the quantities of electricity generated as well as the installed capacities for electricity generation and electrolysis increase as the hydrogen import price rises. However the resulting differences between the import price scenarios vary across the models. The results further indicate that domestic German (and European) hydrogen production is often cost-efficient.

While Afghanistan’s power sector is almost completely dependent on fossil fuels it still cannot meet the rising power demand of this country. Deploying a combination of renewable energy systems with hydrogen production as the excess energy storage mechanism could be a sustainable long-term approach for addressing some of the energy problems of Afghanistan. Since Badakhshan is known to have a higher average wind speed than any other Afghan province in this study a technical economic and carbon footprint assessment was performed to investigate the potential for wind power and hydrogen production in this province. Wind data of four stations in Badakhshan were used for technical assessment for three heights of 10 30 and 40 m using the Weibull probability distribution function. This technical assessment was expanded by estimating the energy pattern factor probability of wind speeds greater than 5 m/s wind power density annual power output and annual hydrogen output. This was followed by an economic assessment which involved computing the Leveled Cost Of Energy (LCOE) the Leveled Cost Of Hydrogen (LCOH) and the payback period and finally an carbon footprint assessment which involved estimating the consequent CO2 reduction in two scenarios. The assessments were performed for 22 turbines manufactured by reputable companies with capacities ranging from 600 kW to 2.3 MW. The results showed that the entire Badakhshan province and especially Qal’eh-ye Panjeh and Fayazabad have excellent potentials in terms of wind energy that can be harvested for wind power and hydrogen production. Also wind power generation in this province will be highly cost-effective as the produced electricity will cost about one-third of the price of electricity supplied by the government. For better evaluation the GIS maps of wind power and hydrogen outputs were prepared using the IDW method. These maps showed that the eastern and northeastern parts of Badakhshan province have higher wind power-hydrogen production potentials. The results of ranking the stations with SWARA-EDAS hybrid MCDM methods showed that Qal’eh-ye Panjeh station was the best location to produce hydrogen from wind energy.

Renewable Energy Community (REC) is a new paradigm in European Union to produce transform share and sell renewables at a local consumer level also via e-fuel (i.e. hydrogen). This work investigates the economic feasibility of a hydrogen Power-to-Gas (PtG) system realized inside a REC using only excess renewable electricity not consumed by REC itself. A single centralized photovoltaic (PV) plant is directly connected to an electrolyser; a hydrogen compressor and two hydrogen storages at low and high pressure complete the PtG system. A scenario of a REC composed by 450 residential electric users (around 1000 people) has been analysed coupled with described PtG considering eight different sizes of PV plant. In the study Italian subsidies to REC shared energy are evaluated as incentives to hydrogen production. An optimal size of PtG components for each PV size is investigated at the limit of economical sustainability evaluating net present value (NPV) positive and near zero. Results show that for the considered REC it is possible to produce and sell up to around 3 tons per year of green hydrogen at most to the same lowest selling price declared currently in the Italian market (5 €/kg).

This net zero investment roadmap summarises government’s hydrogen policies and available investment opportunities.

In this episode Tony Green Hydrogen Director at National Grid and John Williams Head of Hydrogen Expertise Cluster at AFRYManagement Consulting join us to discuss the challenges in implementing hydrogen. Tony is involved in two exciting hydrogen projects: FutureGrid andProject Union. FutureGrid involves building a facility to create a representative whole-network to trial hydrogen. Project Union will develop a UK hydrogen ‘backbone’ joining together clusters around the country potentially creating a 2000km hydrogen network.

In addition to discussing these projects this episode will explore the following issues:

♦ Managing the transition and challenges in repurposing natural gas pipelines to hydrogen

♦ The potential for blending and de-blending hydrogen

♦ The impact of hydrogen on National Grid’s regulatory approach

♦ How to take the first steps towards a hydrogen wholesale market"

The podcast can be found on their website.

If Europe is to meet its 2050 decarbonisation objectives a change of paradigm needs to materialise. The energy sector cannot be understood any more as the sum of independent silos consisting of different energy vectors. Indeed a large number of technologies that are essential to meeting our decarbonisation targets are linking systems and markets currently being planned and operated without fully considering the potential benefits of adopting a holistic approach. If this situation is to persist large-scale sub-optimalities are likely to emerge if the planning and operations of the different components of the energy system will not be able to capture synergies and interdependencies between energy vectors and markets. Interlinkages between systems are appearing between all vectors both at the planning and operation levels. In the case of hydrogen these links are especially important as hydrogen technologies are linking the electricity methane and heat sectors (via electrolysis and hydrogen turbines repurposing of gas assets and hydrogen boilers respectively). Sector integration can allow to capture benefits both in terms of planning and operations:- The production of electrolytic hydrogen poses important challenges in terms of planning the deployment of renewable energy (RES) and electrolyser capacities in a way that ensures that the overall carbon emissions decrease in an effective and cost-efficient manner. Furthermore key questions related to the benefits of co-locating renewable capacities electrolysers and hydrogen demand centres can only be explored if a holistic perspective is adopted. Finally synergies can also appear if planning decisions are taken jointly between the electricity hydrogen and methane sectors as the optimal set of hydrogen infrastructure projects strongly depends on the ability to source electrolysers (link with the electricity sector) and on the possibility to repurpose part of the current infrastructure (link with the methane sector)- Similarly operational considerations also advocate for an integrated approach as electrolysers can provide important flexibility services to the electricity sector if provided with appropriate price signals. These considerations provide the motivation for this study which aims at performing a detailed examination of planning decisions and operational management of a 2050 power system with a focus on comparing different decarbonisation options for the provision of heat of different temperature levels.

The European Commission published its hydrogen strategy for a climate-neutral Europe on the 8th July 2020. This strategy brings different strands of policy action together covering the entire value chain as well as the industrial market and infrastructure angles together with the research and innovation perspective and the international dimension in order to create an enabling environment to scale up hydrogen supply and demand for a climate-neutral economy. The strategy also highlights clean hydrogen and its value chain as one of the essential areas to unlock investment to foster sustainable growth and jobs which will be critical in the context of recovery from the COVID-19 crisis. It sets strategic objectives to install at least 6 GW of renewable hydrogen electrolysers by 2024 and at least 40 GW of renewable hydrogen electrolysers by 2030 and foresees industrial applications and mobility as the two main lead markets. This report provides the evidence base established on the latest publicly available data for identifying investment opportunities in the hydrogen value chain over the period from 2020 to 2050 and the associated benefits in terms of jobs. Considering the dynamics and significant scale-up expected over a very short period of time multiple sources have been used to estimate the different values consistently and transparently. The report covers the full value chain from the production of renewable electricity as the energy source for renewable hydrogen production to the investment needs in industrial applications and hydrogen trucks and buses. Although the values range significantly across the different sources the overall trend is clear. Driving hydrogen development past the tipping point needs critical mass in investment an enabling regulatory framework new lead markets sustained research and innovation into breakthrough technologies and for bringing new solutions to the market a large-scale infrastructure network that only the EU and the single market can offer and cooperation with our third country partners. All actors public and private at European national and regional level must work together across the entire value chain to build a dynamic hydrogen ecosystem in Europe.