Hydrogen+. Where is the deployment of “green” hydrogen in France?
Jan-Erik Starlander. The production and use of low-carbon and renewable hydrogen are still at very low levels today, whether in France or elsewhere in the world. In France, the production of low-carbon hydrogen is of the order of 100,000 tonnes, essentially based on steam reforming of natural gas with capture and industrial reuse of CO2, to which are added around 50,000 tonnes of co-produced hydrogen, c that is to say from another production (chlorine industry in particular), and which can be reused. The volumes of low-carbon and renewable hydrogen produced by water electrolysis are still very low. Here too, it is difficult to precisely assess the volume of production. Today there is around 10 MW of hydrogen production capacity by electrolysis, which allows the production of around 1,200 tonnes of low-carbon or renewable electrolytic hydrogen.
According to estimates from the International Energy Agency (IEA), in 2050, hydrogen could cover 14 to 20% of final energy consumption. This supports our vision of saying that hydrogen alone will not make the energy transition, but that the energy transition will not happen without hydrogen.
In 2021, in our white paper on the trajectory of hydrogen deployment in 2030, we defined two scenarios: “Ambition” which aims to achieve the objective of 6.5 GW of production capacity by electrolysis, with production 680,000 tonnes of renewable or low-carbon hydrogen; “Ambition+” which plans, with 10 GW of production capacity, to produce 1 million tonnes of renewable or low-carbon hydrogen, in order to comply with the proposals for European obligations for the use of renewable hydrogen contained in the legislative package “Fit for 55”. This implies significant low-carbon and renewable electricity production in a context of growing electricity demand. This development, which is entirely possible, would be based in particular on deployments in large basins centered around urban and industrial-port hubs, which can generate significant quantities of hydrogen consumption, and therefore massive centralized production in the medium term. . But we are also banking on a multitude of territorial projects, with a more decentralized production/consumption model.
What actions has been implemented by France Hydrogène to encourage the emergence of these territorial projects?
In 2021, France Hydrogène established regional delegations whose representatives work in consultation with regional councils to encourage the emergence of deployment projects. At the request of the National Hydrogen Council, we are also continuing our work to identify projects and potential in the region in detail. In December, we will unveil a study on this regional network, with more than 200 projects identified and objectives for 2030 region by region. The identification of potential will also be accompanied by recommendations for action.
The deployment of low-carbon and renewable hydrogen production depends in particular on electricity production capacities. We are also studying the potential for production by thermolysis of biomass, and we regret that this is a blind spot in the national strategy. The objective of the study is to allow fluidity in deployment, and to ensure that there is no blockage linked to the resources necessary for production or on uses. Our study shows that we can reach 6.5 GW of production capacity by electrolysis, and even much more.
What is your view on hydrogen mobility for light vehicles/heavy transport?
For us, mobility can be deployed in heavy transport of course, but also in light vehicles and particularly utility vehicles. Mobility is very important for the sector and hydrogen must contribute to reindustrializing France. The State should provide more support for the purchase and rental of utility vehicles, with Renault (via Hyvia, its joint venture with Plug Power) and Stellantis having developed a whole range of hydrogen-powered utility vehicles.
On the distribution side, the sector is proposing the commissioning of 1,000 stations (“Ambition” scenario) or 1,700 stations (our “Ambition+” scenario) by 2030, but, on the ground, we are still far from that, with around 250 station projects identified. In addition to having a sufficient network of stations, the price of fuel must be competitive and vehicles must be produced in large series to lower their price. We will really have to move up a gear in terms of mobility and distribution. Accompanying and supporting uses must be a priority.
Does the surge in electricity prices have an impact on deployment?
The price of electricity has a strong impact on the cost of hydrogen, with the cost of electricity representing approximately 70% of the price of electrolytic hydrogen. As for the entire industry and economy, it is therefore essential that the State and Europe find solutions so that the price of electricity returns to acceptable levels, uncorrelated with the price of natural gas. . The sharp increase in the latter can have a positive impact for low-carbon and renewable hydrogen, by raising the price of gray hydrogen produced from the steam reforming of natural gas. The sharp increase in the price of natural gas can also act as a trigger for industrial players, who can consider substituting low-carbon hydrogen for natural gas in certain processes. Guaranteeing the supply of renewable electricity for the production of hydrogen through renewable energy purchase agreements (power purchase agreements – PPAs) can help guarantee a stable price of electricity.
Furthermore, local models can also be developed, such as that of the Delta Green office building in Nantes which has a photovoltaic electricity production system coupled with an electrolyser and a hydrogen fuel cell, to provide load-shedding during consumption peaks (peak shaving) and deferred energy production. This model, implemented out of conviction by the building’s owners, was not particularly profitable before the current crisis, but today it is an asset allowing lower energy costs.
Are the regulations up to the challenges?
In terms of legislation, an incentive framework is being put in place in France. We are impatiently awaiting a support system for the massive production of hydrogen, which will cover both CAPEX and OPEX, which the State has announced for the end of the year. But if more than 9 billion euros in support for the sector have been announced by the State, the sector wants ADEME to maintain its support for territorial ecosystems. These smaller territorial ecosystems remain necessary and complementary to massive production projects which will take several more years to multiply.
On the European Union side, the Important Project of Common European Interest (PIIEC – IPCEI in English) is a good mechanism. With ten French projects out of 41 selected, France demonstrates that it has an efficient value chain. We would like the EU to fully recognize and support low-carbon electrolytic hydrogen produced from nuclear electricity, in addition to hydrogen produced from renewable energy. State aid rules must also allow Member States to subsidize up to 100% of the additional cost of hydrogen vehicles. Ursula von der Leyen’s announcement of the creation of a European Hydrogen Bank is very positive.
What were France Hydrogène’s actions in 2022?
In addition to its joint work with the Ministry of Ecological Transition on a regulatory package on hydrogen, France Hydrogène published a white paper on hydrogen trucks in early 2022. In July, we published a practical guide on the hydrogen specificities to be integrated into training offers. We have also published an educational booklet “Let’s talk about hydrogen” aimed at the general public.
Finally, in December 2022, in addition to the updated study on the 2030 trajectory and regional potentials, a study on modeling the deployment of stations in 2030 will be made public. France Hydrogène has developed with the Automotive Platform (PFA) and the IRT SystemX institute a configurable tool, making it possible to define, region by region, the optimum network and the locations of station deployment. In 2023, we want to model different hydrogen production and distribution schemes, in order to offer public decision-makers and developers recommendations for planning deployment. We will support requesting regions engaged in this deployment. France Hydrogène has doubled its number of members in two years and welcomes around ten additional members each month, proof of the strong progress of the sector.
