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GREEN HYDROGEN COST REDUCTION are hydrogen’s potential contribution towards GHG neutrality and the need for action in hard- to-abate sectors, along with economic growth and the competitiveness of the domestic industry. Emphasis is given to the industrial and transport sectors. The need for potential hydrogen imports to complement domestic potential is also recognised. The German government will only support hydrogen produced from renewables, hence, it seeks the production and use of green hydrogen by promoting its rapid market rollout and establishing the necessary value chain within the country. Germany has been a key proponent of hydrogen, having already invested around EUR 700 million (about USD 890billion) between 2006 and 2016 under the National Innovation Programme in Hydrogen, with a total of EUR 1.4 billion (USD 1.7 billion) in funding set to be provided within its Hydrogen National Strategy, up to 2026. The German government expects that from 90 terawatt hours (TWh) up to 110TWh of hydrogen will be needed by 2030. In order to cover part of this demand, Germany plans to deploy up to 5 GW of hydrogen generation capacity using water electrolysers coupled to onshore and offshorewindfarmsby2030,withthisrisingto 10 GW in total by 2035-2040. This corresponds to 14 TWh of green hydrogen production and would require 20 TWh of renewables. German industry is highly dependent on hydrogen supplies, with more than 80 TWh of green hydrogen expected to be needed for GHG-neutral steel production by 2050. In addition, 22 TWh of demand is expected from German refinery and ammonia production. The EUR 130 billion (about USD 165 billion) economic recovery package proposed as a response to the COVID-19 crisis includes EUR 9 billion (USD 11.4 billion) for hydrogen, out of which, specifically, EUR 2 billion (USD 2.5 billion) will be targeted for international partnerships. Germany already collaborates with countries in North Africa and countries as far away as Australia, in view of the potential global market that can be developed in future. Japan: This was the first country to adopt a “basic hydrogen strategy” and with specific plans to become a “hydrogen society”. The Japanese strategy primarily aims to achieve cost parity with competing fuels, such as gasoline in the transportation sector or liquefied natural gas (LNG) in power generation. The strategy also covers the entire supply chain, from production to downstream market applications. Given limited natural resources and limited land availability, hydrogen import plays a key role in the Japanese strategy. The approach has been to pursue parallel demonstration projects with multiple sources, hydrogen carriers and enduse sectors to derisk future imports and increase the flexibility of supply. There are projects with Australia (coal with CCS and liquid hydrogen5), Saudi Arabia (oil and ammonia), Brunei (gas and liquid organic carriers) and Norway (hydropower and liquid hydrogen). Japan’s strategy could have a positive global impact and contribute to the creation of new synergies regarding international energy trading and business cooperation. These will be crucial in driving development and making technologies more affordable. According to the roadmap of the Japanese Ministry of Economy, Trade and Industry (METI), Japan expects hydrogen technologies to become profitable by 2030. METI has set specific targets6 for green hydrogen in terms of electrolyser cost (USD 475/kW), efficiency (70%, or 4.3kWh per normal cubic metre [Nm3]) and finally production cost (USD 3.3/kg) by 2030. Morocco: In June 2020, Morocco signed a partnership agreement with Germany that aims to develop the production of green hydrogen and to set up related research and investment projects. The agreement represents the strong will of both countries to move forward in the development of renewable energies and their commitment to sustainable economic development, while making environmental protection a priority. 5 First item is the hydrogen production pathway and second item refers to the form of transporting hydrogen. 6 www.meti.go.jp/english/press/2019/pdf/0312_002a.pdf 24PDF Image | GREEN HYDROGEN SCALING UP ELECTROLYSERS
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