"The northern part of the Baltic Sea, and Finland in particular, shows considerable potential to produce "green" hydrogen for export to Central Europe," states a report by the certification and consultancy company DNV, prepared at the request of the gas network operator Gascade. The report says that Finland's export potential by 2050 is 70 TWh of hydrogen a year, equivalent to roughly 2.1 million tonnes of this fuel.
"Because the country's electricity grid has a high share of renewable electricity, production costs (LCOH = levelised cost of hydrogen) could be comparatively low," Gascade notes in a press release. It is important to add that hydrogen production depends heavily on national energy plans. The network operator stressed that combined onshore and offshore transport infrastructure would have to be built, which would require investment of 12 billion euros.
Germany regards "green" hydrogen (produced from renewable electricity) as a significant source of sustainable energy that will in future complement intermittent wind and solar power generation. Since Germany's own potential to produce this fuel is limited by unfavourable renewable energy conditions, it is forecast that a large share of what it needs will be imported from other countries, such as Finland.
Experts raise Germany's forecasts for hydrogen demand expected in 2030
By 2030 Germany will need more hydrogen across all sectors of the economy than previously forecast, the German hydrogen association (German Hydrogen Association, Deutsche Wasserstoff-Verband, DWV) announced as it assessed its updated projections of future demand. The association estimates that demand will range from 94 to 125 terawatt hours (TWh), with the lower bound 68% higher than experts forecast a year earlier. The new calculations included "a certain share of "grey" hydrogen" produced from fossil gas, currently used in the chemical industry, which will not be fully replaced by "green" hydrogen by 2030, the association noted. Most of the fuel will be needed by industrial sectors such as steel or chemicals manufacturing, as well as by a considerable share of heavy freight transport; initially only a very small share of hydrogen will be needed for heating or electricity generation, the assessment concluded.
"If we do not want to fall behind other industrialised countries in economic growth, we must finally make progress in developing the hydrogen economy," said the association's representative Uwe Lauber, chief executive of the combustion engine and turbine manufacturer MAN Energy Solutions.
Hydrogen produced from renewable electricity is considered essential both for decarbonising some industrial processes and for storing renewable energy on a large scale, helping the economy become climate neutral. There are, however, many unknowns, such as whether it is possible to shift a large part of the economy towards the use of "green" hydrogen. The German government has high hopes for this fuel and has launched an auction system for "green" hydrogen imports because, as mentioned above, the country will not be able to produce the necessary volume on its own. Germany is building the transport and import infrastructure it needs, while industrial sectors have called on the German government to coordinate its actions with other European and global countries.
The German hydrogen association's assessment assumes that the sectors linked to hydrogen use (and their production plants) will not be relocated abroad, because the country is strengthening its economic resilience and seeking to prevent carbon leakage. The report does not address the question of how much hydrogen will be produced in Germany and what share will be imported. The German government set up the German hydrogen association back in 2020; it brings together experts in hydrogen production, research and innovation, industry, the decarbonisation of transport and buildings, infrastructure and international partnerships. The association's task is to outline possible routes for implementing the national hydrogen strategy.
* The technology is based on producing hydrogen – a universal, light and highly reactive fuel – through electrolysis. This method uses an electric current to separate hydrogen from oxygen in water. If that electricity comes from renewable sources, the energy is produced without generating carbon dioxide emissions.
According to the International Energy Agency (IEA), this method of obtaining "green" hydrogen would save the 830 million tonnes of CO₂ emitted every year in producing this gas from fossil fuels. Likewise, replacing "grey" hydrogen worldwide would require 3,000 TWh a year from new renewable energy sources, equivalent to current European demand. There are doubts about the "viability" of "green" hydrogen because of its high production costs. Those doubts are justified, but they will fade if decarbonisation continues and renewable energy generation thereby becomes cheaper.