EU | Hydrogen and E Fuels

EU | Hydrogen and E Fuels

The Russia invasion of Ukraine has brought into focus some of the risks of a global energy market, with gas supply constraints and the resulting price volatility placing great strain on Europe’s industries and citizens. A reduction in Europe’s reliance on natural gas will be a natural consequence of decarbonisation. However, by seeking to import a significant proportion of its future energy in the form of hydrogen and derivatives, there is a potential supply risk of continued reliance on foreign energy supply. Many of the countries likely to export hydrogen to Europe are in the Global South, leading to concerns about resource exploitation, environmental impacts and delaying local decarbonisation. This report finds that this is a complex situation without simple right or wrong answers.

There are benefits and risks associated with the EU importing hydrogen, both to the exporting countries and to the EU itself. This report for Transport & Environment seeks to understand the situation, by performing case studies on six countries likely to export hydrogen to the EU.

The study includes the state of the electricity system in each country, environmental, social and economic factors, a review of announced projects and a counterfactual consideration of the situation should each country not export hydrogen. The study also considers the benefits and risks and the EU focussing on domestic hydrogen production rather than import. Demand targets In European policies, numerous hydrogen demand scenarios are presented.

Different hydrogen targets for different hydrogen-based energy vectors are found in policies including Renewable Energy Directive (RED), RePowerEU, ReFuelEU and Fuel EU regulations. From these policies only RED and SAF are legally binding, and rest of the documents are non-binding in nature.

Global Hydrogen Insight