More than half of EU hydrogen consumption will come from the industrial and transport sectors by 2030, according to modelling by the European Commission, with industrial heat accounting for 3.6mn t/yr, petrochemicals 3.2mn t/yr, transport 2.3mn t/yr, and refineries 2.3mn t/yr.

The Commission’s RepowerEU plan sets a target for the EU to produce 10mn t/yr of hydrogen domestically and import a further 10mn t/yr by 2030. This would be double the overall target from the level envisaged by the previous legislation—the ‘Fit for 55’ package.

The European Commission modelling tool, called Primes, show this doubling of the target creates economies of scale and lower prices, resulting in more opportunities for the uptake of higher volumes in the industry and transport sectors.

In industry and refining the doubling of the targets quadruples the level of hydrogen use from that envisaged under the Fit for 55 target, while in the transport sector it triples it.

“Hydrogen production based on natural gas should be replaced in ammonia production and in hydrogen use by refineries by 2030” European Commission

The share of hydrogen and other renewable fuels in the transport sector as a result of the scale-up would increase to over 5pc, the modelling shows.

“The 2.6pc doubling to 5pc in transport sector is a very big scale-up,” Felicia Mester, director of public affairs for advocacy body Hydrogen Europe, tells Hydrogen Economist. “It does not sound as if it is a huge one. But in terms of volumes of hydrogen for that sector this is huge.”

In industry, the extra supply will enable firms to start shifting technologies faster than they would have done previously, according to the Commission.

“Hydrogen production based on natural gas should be replaced in ammonia production and in hydrogen use by refineries by 2030 and the steel industry should see the start of the shift from the use of coking coal to hydrogen,” says the report. 

The new targets also show two new demand sectors emerging that were not present under the Fit for 55 modelling—gas grid blending (1.3mn t) and power generation (0.1mn t).

The Commission reiterates its position that blending hydrogen into the natural gas grid requires careful consideration as it diminishes gas quality, can increase overall system costs and is often a less efficient alternative to direct electrification. It notes that the costs for end-users and infrastructure operators to adapt to a 5pc blending level would amount to around €3.6bn ($3.8bn).

“Nevertheless, blending up to around 3pc by volume of renewable hydrogen in the gas grid may absorb about 1.3mn t of hydrogen,” says the report.

To support such an increase of renewable hydrogen use in these sectors, a progress report on the production, transportation and uptake of the fuel should be prepared regularly, starting in 2025, the Commission says.

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Author: Tom Young