Germany to give hydrogen infrastructure priority to drive market ramp-up

Germany's cabinet has agreed to give hydrogen infrastructure planning and approval priority to drive the rapid development and expansion of its production, storage and supply. The draft Hydrogen Acceleration Act is set to ensure that electrolysers and import terminals can go into operation "as quickly as possible," economy minister Robert Habeck said, calling the agreement a milestone on the road to a hydrogen economy. "An efficient hydrogen infrastructure is of crucial importance for the decarbonisation of industry. Hydrogen pipelines will be the lifelines of industrial centres," Habeck said. "Time is of the essence."

Under the act, procedures for planning, approval and tendering of hydrogen projects will be accelerated, simplified and digitalised. "The law incentivises the production of green hydrogen, in that only those electrolysers that produce hydrogen using electricity from renewable energies, so green hydrogen, are in the overriding public interest and receive this speed boost," Daniel Greve, a spokesperson from the economy ministry (BMWK), said during a press conference.

The local utilities association VKU and the energy industry lobby group BDEW have both largely welcomed the draft law. However, the VKU pointed out that the expansion and conversion of gas distribution networks should have also been given overriding public interest status, while BDEW called for the government to quickly present its awaited hydrogen import strategy. The draft law now has to be debated and decided in parliament.

Hydrogen made from renewable electricity is seen as crucial to decarbonise certain industry processes and for large-scale renewable power storage, thus helping to make the economy climate-neutral. However, there are many unknowns about the feasibility of switching large parts of the economy to run on green hydrogen. The German government is betting heavily on the fuel and has launched an auction scheme for green hydrogen imports, as the country will not be able to cover demand with domestic production. The country is building up the necessary transport and import infrastructure, and industries have urged Germany to coordinate with other countries across Europe and the world.