09/18/2023
Source: Energy & Management Powernews
Germany must cover most of its hydrogen needs through imports. To what extent synthetic natural gas could play a role as a hydrogen carrier, Agora has investigated.
By 2030, Germany wants to build 10,000 MW of electrolysis capacity. The hydrogen produced with it is enough to cover 30 to 50 percent of Germany's hydrogen needs. The rest will have to be covered by imports from abroad. According to the National Hydrogen Strategy, imports of at least 45 billion kWh of hydrogen per year will be needed from 2030. Imports via pipelines will not be sufficient for this, as a study by Agora Industrie indicates. Another import option is transport by ship. According to the study, which Agora prepared together with the Technical University of Hamburg, the costs and technical risks vary depending on the import route.
The study is entitled "Hydrogen import options for Germany. Analysis with an in-depth look at synthetic natural gas (SNG) with a nearly closed carbon cycle." By way of background, the possible use of SNG is increasingly being discussed as an option, according to the market researchers. SNG is produced artificially using electricity and CO2. If both come from sustainable sources - such as solar power and CO2 from the air - one can speak of a climate-neutral molecule. However, Agora adds, the climate-neutral use of SNG requires additional technology components, such as for the capture and transport of CO2 (carbon capture and storage, CCS).
Explaining the focus on SNG, Frank Peter, director of Agora Industrie, says: "With the construction of LNG terminals in Germany, a discussion has also flared up about the future use of infrastructure for importing climate-neutrally produced molecules. For some concepts, the LNG terminals have created the conditions for being considered as an import alternative for hydrogen in the first place. The competition over which route Germany will use to import the hydrogen it needs in the future has thus widened."
From their research, the study authors draw the following conclusions:
- Transport costs : Pipelines are the cheapest way to import pure hydrogen with costs below 1 Euro/kilogram hydrogen. When importing hydrogen carriers by ship, transport costs increase to about 2 to 5 euros/kilogram of hydrogen after reconversion. Hydrogen derivatives such as ammonia or briquetted sponge iron (HBI), which can be processed directly, are a cost-effective alternative - costs are less than 1.50 euros/kilogram of hydrogen. SNG as a hydrogen carrier with reconversion at the import port costs 3.50 to 4.50 euros/kilogram of hydrogen. SNG appears cheaper, according to Agora, provided that a central reconversion into gaseous hydrogen can be dispensed with.
- The SNG import option: According to Agora, the use of SNG with a nearly closed carbon cycle as a hydrogen carrier is accompanied by three challenges: First, it involves components with a comparatively low level of technology maturity and an implementation time of ten years. Second, SNG competes with other import options that can undercut SNG on price in the medium term. Third, there is regulatory uncertainty in how international carbon flows can be measured, documented, and verified.
- On SNG infrastructure : Existing natural gas networks can be used to transport SNG in the short term. However, according to Agora, its use involves a transformation risk if it delays the necessary conversion of methane networks to hydrogen. The market researchers recommend: Given the critical importance of SNG, the focus in Germany should be on converting to and building hydrogen pipelines. The creation of new CO2 infrastructure should focus on no-regret CCS applications.
The 66-page publication "Hydrogen Import Options for Germany. Analysis with an in-depth look at Synthetic Natural Gas (SNG) with a nearly closed carbon cycle" can be downloaded from the website of Agora Energiewende, under whose umbrella Agora Industrie is located.
Author: Davina Spohn
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