Germany's hydrogen import bill estimated at EUR1.2-7bn by 2030: study

Germany will not be able to meet all of its hydrogen demand from piped gas, the cheapest way of transporting hydrogen, forcing the country to rely on costlier shipping options instead, according to a new study by influential think-tank Agora Energiewende.

By 2030, Germany looks to import 45 Terawatt-hours worth of hydrogen – or 1.3 million tonnes.

According to the new study by Agora Energiewende, “pipelines are the cheapest way to import renewable hydrogen to Germany,” with estimated costs sitting below EUR1 per kilogramme.

Assuming all 45 TWh of Germany’s hydrogen imports are transported that way, this would translate into a EUR1.2 billion bill by 2030, just to cover transportation costs.

By contrast, if hydrogen is carried over longer distances by ship, similarly to liquified natural gas (LNG), “the costs rise to about EUR2 to EUR5 per kilogram of hydrogen due to the conversion back to hydrogen,” the research found.

As a result, Germany’s import bill could rise to anything between EUR2.5bn and EUR7bn by 2030 – just to cover the transportation costs, according to Agora’s figures.

Moreover, the think tank cautions that technologies to carry hydrogen by ship – like transforming it into synthetic natural gas – are currently far from being mature and therefore unlikely to be competitive in the short term.

This matters because one of Germany’s many new LNG terminals in Wilhelmshaven should be turned into a synthetic hydrogen import terminal as early as 2027, according to an agreement stuck with its operator, TES.

Importing products derived from hydrogen is expected to come much more cheaply, though.

“Derivatives such as green ammonia or briquetted sponge iron (HBI) represent a particularly favourable solution at less than EUR1.5 per kilogramme of hydrogen,” the report said.

“But only if these materials can be processed directly without expensive conversion, for example for fertiliser or steel production.”

Similar findings are increasingly being made by German government advisers and think tanks, who caution against being too married to the idea of keeping all energy-intensive industrial production inside the country, no matter the cost.

Pipelines into Germany

German authorities currently envisage three hydrogen pipelines to supply the country’s energy-intensive industries.

First, there is the land-based pipeline that aims to transport some share of the 20 TWh of targetted hydrogen production from Denmark into Germany, although construction has yet to begin.

“From my part, I can say the bigger, the better,” Germany’s Vice-Chancellor Robert Habeck said at the signing of the joint agreement in March.

Norway aims to be a hydrogen supplier as well. A feasibility study exploring the politically envisaged pipeline is currently underway – and already delayed by half a year. In July, the two countries set up a joint task force, too.

The goal remained “the large-scale supply of hydrogen from Norway to Germany from 2030,” Habeck said in the statement. His counterpart Jan Christian Vestre was “thrilled to see the progress.” The Germans did not release the statement, crafted at Oslo’s behest.

And then there’s H2Med, the result of a multi-year row between Spain and France over a pipeline project connecting the two countries. The final agreement envisages the construction of a hydrogen pipeline instead of one transporting natural gas, which could be connected to Germany as well.

[Edited by Zoran Radosavljevic and Fr?d?ric Simon]