Australian-German business coalition produces a roadmap for large scale green hydrogen import to Germany
Jun 24, 2022
Today a leading group of German companies along with Australia's Fortescue Future Industries (FFI) has released a green hydrogen roadmap, outlining a set of recommendations for government and industry, to meet the ambitious target of importing large amounts of green hydrogen from Australia to Germany.
The Green Hydrogen Taskforce, created earlier this year, is a collaborative effort between FFI, and some of the strongest energy, industrial, and technology companies in Germany, including Covestro, E.ON, Linde, Luthardt, SAP, Schaeffler, thyssenkrupp Nucera and thyssenkrupp Uhde.
The green hydrogen roadmap developed by the Taskforce consists of a 10-point plan and a White Paper and is intended to outline a constructive pathway forward in Germany for business and government. The roadmap could potentially serve as an example for other nations looking for solutions at the upcoming G7 meeting. The G7 meeting will discuss hydrogen and has already developed a G7 Hydrogen Action Pact (G7 HAP) which will form part of the final G7 communique.
The companies in the taskforce are ready to move on green energy through serious investment and will work with Government to achieve these goals together. The recommendations to the German government include: developing subsidies and incentives to remove the "First Mover Disadvantage"; encouraging sources of low-cost capital to scale the industry, and underwriting equipment manufacturers expansion plans to meet developer's needs.
Climate change has become a dramatic reality of our times with visible impacts on all continents and all countries. The UN IPCC report has recommended reducing fossil fuel production to keep temperature increases under 1.5 degrees and halt the worst impacts of global warming. With this responsibility in mind, the industry stands ready to do its part.
The Russian war on Ukraine has in addition created a new reality. This must lead to an accelerated energy transition, especially regarding the development of a green hydrogen economy, which will help to decarbonise as well as to diversify energy supply.
Dr. Cord Landsmann, CEO of thyssenkrupp uhde, said, "The future of energy needs the right partnerships and the right technologies. We bring our expertise in industrial-scale hydrogen applications like green ammonia for enabling the worldwide export/import of clean energy".
Patrick Lammers, COO at E.ON, said, "We are determined to implement the green transformation of the economy. For this, the development of a reasonable green hydrogen environment must be given priority. In the long term, this strengthens climate protection, independence from Russian gas and the competitiveness of our industries. This deserves a high level of political support".
Juergen Nowicki, Executive Vice President Linde and CEO of Linde Engineering, said, "For an industrialized nation such as Germany it is of utmost importance to secure reliable and affordable energy. Clean hydrogen has an important role to play in the energy transition, but we need to have the right framework, incentives and infrastructure in place to make it actionable as a lever to decarbonisation. We are committed to supporting the effort to decarbonise Germany's economy by leveraging Linde's knowledge, experience and technology along the entire hydrogen value chain, from production and storage to transportation and application."
Dr. Klaus Schäfer, Chief Technology Officer and member of the Board of Management of Covestro, said, "Green hydrogen is a central building block for the transformation of the chemical industry towards climate neutrality. Covestro and other industry partners are in the starting blocks to get the hydrogen economy up and running. However, we also need the right framework conditions and political support to achieve this. Using the example of the partnership between Germany and Australia, this action plan shows which steps need to be taken in detail. It complements the ongoing HAP initiative and establishes an actionable plan which can easily be replicated amongst the G7 countries and beyond."
"This also includes the critical topic of tracking and tracing of green hydrogen and green ammonia through the complete value chain including the certificates of origin with the aim that the end customers will exactly know what they get," said Peter Koop, Global Lead for Energy Transition and Hydrogen at SAP.
Uwe Wagner, CTO of Schaeffler AG said, "the envisaged hydrogen partnership between Germany and Australia is a vital step to foster clean energy in Germany. To turn this goal into reality, quick industrialization of electrolysis and other hydrogen technologies will be crucial. We stand ready to speed up the energy transition with the supply of high-quality components for the large-scale production of electrolysers."
Dr. Andrew Forrest Chairman of FFI, said, "Germany and the European continent are facing stagflation for the first time in years. If structured appropriately, an accelerated uptake of green hydrogen also by means of green ammonia can be a powerful economic growth driver for Germany. Our White Paper estimates that for every €1 spent as a support mechanism by Government for green hydrogen, €10 is unlocked in private investment."
Global green energy company FFI and one of Europe's largest energy companies with focus on energy infrastructure and customer solutions, E.ON, recently announced a partnership with the goal to supply 5 million tonnes of green hydrogen a year by 2030 - the equivalent of one third of the calorific energy of natural gas Germany imports from Russia.
"Our message is very clear. The green energy industrial revolution is here. Do not allow the energy crisis to make the climate crisis worse. Germany can become a green energy superpower and we have outlined the pathway to make it happen, including the financial investment required by government. Business is ready."
Key findings from the reports released today:
A full copy of the White Paper and 10 point action plan was released today and can be found here.
Industrial demand centers in Germany and the EU are ready to offtake up to 5 Mtpa of green hydrogen in the short-term, with a total addressable market of up to 27 Mtpa in the long-term.
By 2030, carbon price will likely reach a sufficient threshold for imported green hydrogen to be competitive with fossil fuels, negating the need for any further subsidies (Source: RMI analysis)
The required near-term market- and first-mover support of €20-30 billion will achieve more than 10x leverage on capital deployed into industrial assets. (Source: RMI analysis)
Clear and timely government support is needed to signal confidence in a burgeoning green hydrogen market and remove barriers to investment.
Once common standards and robust financial mechanisms are in place, stakeholders across the green hydrogen value chain are ready to agree on contracts and ensure production, transport, storage, and conversion facilities are ramped up at the scale required to meet deployment targets.
Green ammonia is a key route for green hydrogen to be supplied to EU markets as existing infrastructure can be leveraged and expanded, and safe handling of ammonia is well established
Moving quickly and strategically to build up a green hydrogen trade will enable Germany and the EU to capitalize on short-term opportunities across volatile global energy markets, and to safeguard energy security while achieving critical decarbonization objectives.