German energy industry weighs benefits of new U.S. fossil fuel policy for blue hydrogen approach

Representatives of the German energy industry say that the policy announcements by the new U.S. administration could benefit their country’s competitiveness if the next government takes a “pragmatic” approach regarding president Donald Trump’s fossil-friendly stance, newspaper Die Welt reported. However, they also cautioned that differences in other policy areas could still pose grave challenges. The head of Germany’s largest gas supplier and energy importer Uniper, Michael Lewis, said it was “positive” that Trump plans to sell more natural gas from the U.S. and suggested that Germany allows for more “blue hydrogen” made with the fossil fuel in its energy transition plans, rather than solely relying on “green hydrogen” produced with renewable power sources.

Economist and government advisor Monika Grimm seconded this view, arguing that more blue hydrogen would make it easier for German companies to keep producing in Germany. Trump’s energy plans “funnily enough solve a problem for us,” Grimm argued, pointing to difficulties in bringing green hydrogen production to scale in order to satisfy German industry’s hunger for new gas after the loss of Russian pipeline supplies. Efforts to boost domestic green hydrogen production so far have remained behind schedule and the 10 gigawatt of production capacity envisaged for 2030 currently appear out of reach, according to Die Welt.

Blue hydrogen has thus far been rejected especially by the Green Party, but the launch of Germany’s carbon management strategy opened a path to making the fossil fuel-derived synthetic fuel’s production climate neutral, the newspaper reported. A surge in global availability of natural gas would then make this approach even cheaper, but blue hydrogen so far remains off limits in the federal government’s energy plans. Egert Laege, head of the government-owned gas importer SEFE, said that companies would welcome such a step. “Many of them would benefit from this,” Laege told the newspaper.

Germany’s Green Party economy minister Robert Habeck recently rejected an expansion of liquefied natural gas (LNG) imports from the U.S., arguing that the North American country already supplied the largest share of LNG and that Germany should not make itself more dependent on these.