BEE sees an acute need for action

02.10.2025

Source: E & M powernews

The German Renewable Energy Federation is calling on the German government to provide new impetus for the hydrogen ramp-up. The association outlines nine specific measures in a position paper.

The German Renewable Energy Federation (BEE) is calling on the German government to provide new impetus for the hydrogen ramp-up, as green hydrogen plays a central role in the energy transition. It refers to the German government's recently published monitoring report on the energy transition. According to this report, the demand for hydrogen is rising sharply: For industry, the report forecasts demand of 16 to 26 billion kWh by 2030, while a mandatory quota for refineries could trigger investments in around 5,000 MW of electrolysis capacity.

However, the ramp-up is currently not making any progress. In a position paper, the association lists measures with which the German government should set the course for a functioning ramp-up.

The association highlights the rapid implementation of the EU RED III Directive as the first building block. These requirements would create reliable demand and trigger investments in additional electrolysis capacities.

The BEE is also calling for tenders for electrolysers that serve the system. If these are planned at suitable locations, they can relieve the electricity grid by using surplus green electricity to produce hydrogen. The Wind-on-Sea Act already provides for tenders for 500 MW of such plants. The BEE believes that the government should implement the regulation quickly.

Changes to the EnWG necessary

The principle of "use instead of curtailment" is key. According to BEE, hydrogen could be produced more cheaply if electricity volumes that would otherwise be curtailed for grid reasons could be used for electrolysis. To this end, the government must adapt the rules in the Energy Industry Act (EnWG) so that operators can use this electricity more easily and reliably.

The association also criticizes the high electricity procurement costs. Levies, surcharges and grid fees place a considerable burden on production. Companies should therefore be allowed to use redispatch electricity specifically for hydrogen production. In addition, grid fees should be abolished and the criteria for green electricity at EU level should be adjusted so that producers have significantly lower costs.

The high investment costs for electrolysers are also a problem. According to the monitoring report, they account for up to half of the total costs. The BEE is therefore calling for short-term funding programs and a reduction in construction cost subsidies. At the same time, it emphasizes the importance of research and development in order to achieve long-term cost reductions.

Stimulate demand, reduce uncertainties

Another focus is on strengthening demand. For the industry, the association proposes climate protection contracts, quotas and guaranteed purchase regulations. Public sector tenders could also create sales markets. For the energy industry, the BEE points to the development of H2-ready power plants that can be operated with hydrogen in the long term. This would ensure security of supply if controllable renewable energies are not sufficient.

In order to avoid uncertainties on the generation and demand side, the association refers to instruments such as double auctions or legally enshrined contracts for difference. These models are known from the UK, for example, but have not yet been introduced in Germany for the hydrogen market. In the BEE's view, they could create investment security and facilitate market integration.

Plea for orange hydrogen

Finally, the association advocates the greater inclusion of biogenic hydrogen from biomass or biogas (orange hydrogen). If this were used in refineries, it could be counted towards the legally prescribed greenhouse gas reduction quota. This would create incentives to use biogas instead of fossil fuels.

According to the BEE, domestic production of green hydrogen offers many advantages: more flexibility in the electricity system, less dependence on imports and additional value creation in Germany. In order for the German government to be able to exploit this potential, it must provide sufficient funds in the 2026 federal budget. Although the budget provides for more funding for hydrogen, there is a lack of funds for investment protection instruments.

The eight-page position paper "Green hydrogen in Germany: New impetus needed" can be downloaded from the BEE website.

Author: Davina Spohn