Hydrogen is considered an attractive alternative to natural gas for many processes in the metallurgy, heating technology and casting industries. However, enormous quantities are needed. To meet demand, Germany relies on imports. An announcement made over the weekend sounds promising: the hydrogen pipeline "H2Med" between Barcelona and Marseille is to be extended to Germany. What can the industry now hope for? Details and background information.
On Sunday, January 22, French President Emmanuel Macron and a German delegation led by German Chancellor Olaf Scholz celebrated the 60th anniversary of the 1963 Élysée Treaty in Paris. The festivities also included talks on the future of energy supply in Europe.
Two million tons of hydrogen per year
In an official press release from the Élysée Palace, Macron confirmed, among other things, that the "H2Med" pipeline agreed between Spain and France in December 2022 will also supply Germany with green hydrogen from the Iberian Peninsula.
The wording states that the intention is to "take the necessary steps for a European backbone for hydrogen transport throughout Europe." This includes the "necessary national and transnational hydrogen infrastructures [...] [and] the expansion of the H2Med pipeline to Germany." In addition, he said, a joint "hydrogen working group" is to be established to develop further recommendations by the end of April. The goal is European hydrogen production on an industrial scale.
H2Med could become one of several pipelines supplying Germany with hydrogen from abroad (Source: iStock)
Estimates put the cost of building the pipeline at €2.5 billion. It should be able to transport up to two million tons of hydrogen per year by the year 2030. That would be about ten percent of Europe's estimated total demand, which Commission President Ursula von der Leyen put at 20 million tons in 2030 in December. Half of this is to be produced in the European Union, while the rest will be imported from outside Europe.
Hydrogen imports for German industry
Gas has been an issue in German energy policy at least since the publication of the National Hydrogen Strategy 2020.
The German government assumes that the national hydrogen demand will be up to 110 TWh in 2030. Electrolyzer plants are expected to produce part of it domestically; experts estimate the potential at around 14 TWh. At least 80 % of the hydrogen requirement will therefore have to be imported. Procurement is complicated regarding the prevailing desire in Germany to use primarily CO2-neutral, "green" hydrogen.
In a dossier on the subject, the BDI writes that, in addition to expanding domestic electrolysis capacities, Germany should create a transport network for hydrogen and enter international energy partnerships. In this respect, the announcement from Paris is entirely in line with the demands of the industry.
Presentation of the Cepsa electrolyser project in the presence of Prime Minister Sánchez (Source: Cepsa)
Spanish hydrogen plans
Countries around the world are planning to build large capacities to produce green hydrogen. Particularly suitable are wind-rich regions such as Scotland and Scandinavia, or sun-rich areas as existing in Australia, Africa or southern Europe.
Spain in particular has become prominent as a future major exporter of hydrogen. At the end of last year, the company Cepsa announced its intention to commission two new hydrogen plants with a total capacity of 2 GW. They are part of the "Green Hydrogen Valley" in Andalusia, which is to be Europe's largest production site for green hydrogen by 2026.
On the occasion of the announcement, Prime Minister Pedro Sánchez had said that Spain could become "an energy exporting country" thanks to hydrogen. According to estimates by the International Renewable Energy Agency (IRENA), green hydrogen will be cheaper than conventionally produced "gray" hydrogen in Spain from 2026. The reason is the low cost of renewably produced electricity. These are around one cent per kWh.
The hydrogen roadmap is therefore receiving generous investments of up to €8.9 billion from the Spanish government. By 2030, electrolysis capacity is expected to reach 4 GW.
A maritime hydrogen corridor would connect two of Europe's most important ports: Rotterdam and Algeciras (Source: Cepsa)
History of a pipeline project
The H2Med pipeline expresses the French desire to participate in the volumes of green hydrogen produced in Spain. Until recently, energy deliveries between the countries were supposed to be rather reduced, though.
In 2019, the French government had announced its intention to cancel construction of the 190-km "MidCat" ("Midi Catalogne") natural gas pipeline between Barcelona and Carcassonne. The project, which was started in 2013, seemed to be too expensive and outdated.
With the outbreak of the Ukraine war and the lack of natural gas supplies from Russia, the idea of a Spanish-French pipeline became relevant again. In October 2022, Paris and Madrid announced that they would continue the project under the name "BarMar." However, the new pipeline would not pass through the Pyrenees as originally planned but would connect Barcelona with Marseille as an undersea pipeline through the Mediterranean Sea.
VDMA sees "considerable growth opportunities" for machinery and plant manufacturers thanks to newly emerging supply chains for hydrogen (source: pixabay)
In December, Spanish President Sánchez and Macron announced that "BarMar" would be renamed "H2Med." The new name is intended to focus on the fact that mainly hydrogen will flow through the pipeline. It will be up to 476 km long. According to the French industrial magazine L'usine nouvelle, construction will begin in 2026.
From 2030, green hydrogen could then flow from the sunny regions of southern Spain via France to the energy-hungry industrial centers of Germany.
New sales opportunities for process technology
The VDMA points out that the new hydrogen pipeline will not only provide a source of raw materials, but also open up new sales opportunities for process technology.
In September, the association commissioned a study to evaluate the hydrogen economy from the perspective of plant manufacturers. The conclusion was that the market for hydrogen technologies offers "considerable business potential," with entire supply chains in the making.
Investments in hydrogen-capable plants and components could increase significantly. Sales opportunities arise from the possible sale of equipment along the entire hydrogen value chain: production, transport, storage, distribution and applications, for example in the mobility and energy sectors. The European market for electrolyzer equipment alone is expected to be worth €6-10 billion in 2030. The actual volume will depend on how costs develop and how many projects are implemented. The study is available online free of charge.
Against this background, it is a good signal for process technology if capacities for hydrogen imports to Germany are created. The more hydrogen is available, the greater the sales potential for suitable equipment is.
When the Élysée Treaty was signed in the coal and oil dominated 1960s, no one would have imagined that half a century later European industry would be relying on hydrogen as an energy carrier. But beware: Not a single cubic meter has yet arrived in Germany.