Clear regulation at national and EU level is vital to the development of cost-effective hydrogen networks, according to Han Fennema, CEO of Dutch gas network operator Gasunie.

Government support has enabled Gasunie to develop a €1.5bn ($1.8bn) national hydrogen pipeline network in the Netherlands.

The network should be in place by 2027 and will consist of 85pc repurposed natural gas lines, supplemented by new connections built specifically to carry hydrogen. The network will have a capacity of 10GW, equal to 25pc of the energy consumption of Dutch industry.

Last September, the Dutch government put aside €750mn from its budget for a hydrogen infrastructure backbone to connect five industrial clusters.

“Supply and demand needs open access to transport and storage infrastructure in a non-discriminatory way” Fenema, Gasunie

“This will give a kickstart to the hydrogen grid,” Fennema said at the World Hydrogen Summit in Rotterdam. “Supply and demand needs open access to transport and storage infrastructure in a non-discriminatory way.”

The majority of this backbone (85pc) will use the existing natural gas grid, after it is retrofitted, with just 15pc of the infrastructure consisting of new pipelines. The final infrastructure will also include cross-border connections.

It is vital for the EU to help set a clear strategy at a federal level to pave the way for these connections, according to Fenema.

“It is important that we have the European Commission to make these statements to give certainty to market players,” he says.

Gasunie is a member of the European Hydrogen Backbone (EHB), a group of 23 European natural gas grid operators lobbying for extensive use of existing pipelines to transport hydrogen across the continent. The EHB puts the cost of developing a Europe-wide hydrogen network by 2040 at €43-81bn, with repurposed gas lines accounting for 69pc of the capacity.

Networks down under

Support at both state and federal level has similarly been vital in helping Australian hydrogen projects develop rapidly, according to Edit Musci, director for minerals and energy for the state government of South Australia.

“It is about industry, academia and government working together,” she says. “The regulatory environment must provide flexibility, certainty and trust for developers over a long-term perspective.”

Australia has set aside A$850mn ($590mn) to invest in hydrogen technologies as part of its 2022-23 budget as the nation looks to become a major exporter of the fuel.

€750mn – Amount provided in Dutch budget for hydrogen technologies

The money will come through the government’s clean hydrogen industrial hubs scheme, which aims to develop regional hydrogen hubs in Gladstone, Darwin, Tasmania, the Eyre Peninsula, Pilbara, the Latrobe Valley and the Hunter Valley.

In addition, many Australian regions—including South Australia—have their own hydrogen strategies and provide support finance.

The places in-between

And there may be regulation required beyond even local and central government level if the industry is to flourish, according to Tarek Helmi, a partner in Deloitte's strategy & operations practice with a focus on energy, resources and industrials.

“Regulatory framework is still at the start,” he says. “Shipping is still looking at what is the future—ammonia or methanol. It is not an easy decision. The main message is you need to understand all of your factors, and these factors are different by sector.”

Shipping and aviation will require separate regulation from UN agencies the International Maritime Organization (IMO) and the International Civil Aviation Organization (Icao) respectively.

Ammonia, hydrogen fuel cells, methanol and liquid hydrogen are all hydrogen-derived fuels that can be used to power vessels. The IMO has agreed rules on methanol and fuel cells but work on the others is in development. 

Aviation is most likely to be powered by liquid hydrogen. Icao has looked into the technology but not yet issued any guidelines or regulation given the nascent state of the technology.

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Author: Tom Young