This recommendation comes from the latest government-funded Ariadne report, Strengthening Germany’s Competitiveness Through the Import of Green Feedstocks. Currently, the country plans to import up to 70% of hydrogen to meet its 95-130TWh by 2030 demand.
Read more: Berlin approves import strategy to meet up to 70% of 2030 hydrogen demand
The report argued that Germany’s competitiveness is under scrutiny amid stagnant growth and the need for industrial transformation. High costs for green energy carriers pose a long-term “disadvantage”, and fully replacing fossil fuel imports with green alternatives is deemed unrealistic “because they are far harder to transport.”
Ariadne Researcher Philipp Verpoort explained, “For fundamental physical and economic reasons, it is unrealistic to carry out all energy-intensive production steps for green basic materials in Germany in the future. A subsidised ‘business-as-usual’ approach risks leading to a dead end.”
Instead, Ariadne suggested shifting to green feedstocks for its key industries, which could retain jobs and competitiveness while outsourcing the most energy-intensive production step abroad.
“If Germany’s basic materials industry imports more feedstocks in the future, the nation’s hydrogen demand will likely be lower than often assumed,” the report added. “However, substantial hydrogen demand will persist in certain industrial sectors, requiring continued support for the transition to hydrogen.”
“Energy-intensive companies must assess to what extent importing feedstocks is necessary for a viable transformation. Cementing high-cost structures reliant on permanent subsidies would be economically inefficient and politically unsustainable.
“Focusing on high value-added downstream industries could provide an opportunity for some production sectors to maintain competitiveness in basic materials while preserving value creation and associated jobs in Germany.”
Furthermore, a “friendshoring” approach – partnering with allied European countries that have better access to renewable electricity – could “lower costs and ensure supply security.”
One such example of this is the €34-49bn REPowerEU Plan launched by the European Commission in 2022, in reaction to Russia’s invasion of Ukraine.
Read more: REPowerEU: €34-49bn needed for hydrogen infrastructure
The plan was introduced as part of the EU’s desire to cut dependency on Russian fossil fuels and reach its climate targets. The aim is to facilitate imports of renewable hydrogen through three import corridors in the Mediterranean, North Sea and Ukraine.
Germany’s 9,000km hydrogen gamble: Will the Wasserstoff-Kernnetz pay off?
“We are creating security for everyone involved – from hydrogen producers at home and abroad to the operators of power plants and storage facilities and future industrial users.”
That was the message from German Vice-Chancellor and Minister for Economic Affairs and Climate Protection, Robert Habeck, when his government’s plans for a 9,040km ‘Wasserstoff-Kernnetz’ or hydrogen core network (HCN) were approved by the Federal Network Agency (BNetZA).
The HCN will cover the width of the country, resulting in a feed-in capacity of 101GW of hydrogen and a feed-out capacity of 87GW. Expected to complement the nation’s ambitious hydrogen production and import strategy, the network will connect import terminals to industrial hubs located throughout the country.
It’s a mammoth ambition. In many ways, enabled not only by the aspirations of the German Government, but also by EU regulations. The European Council which adopted the Hydrogen and Decarbonised Gas Markets Decarbonisation Package last May.
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