This week, Michael invites Jorgo Chatzimarkakis, CEO of Hydrogen Europe, to debate the importance of hydrogen in powering Europe and the world towards a decarbonized economy. Chatzimarkakis holds hydrogen to be the miracle molecule of the transition, while Michael’s Hydrogen Ladder has a far narrower view of its likely uses on the path to net zero.
What follows is a comprehensive, robust – and at moments, fierce - discussion of hydrogen in the transition, covering electrolyzers, fertilizers, freight, transportation and heating, as well as following the “pots of money” behind hydrogen infrastructure and lobbying in Europe.
Michael Liebreich Jorgo, you are the CEO of Hydrogen Europe. In your own words, what is Hydrogen Europe?
Jorgo Chatzimarkakis Hydrogen Europe is an association created to cover innovation in hydrogen. Industry needed to put their strategies together when it came to innovative hydrogen projects, that's why it was created. In 2016, they discovered it's not enough, we need to do advocacy. I entered Hydrogen Europe right then, so after my time in politics. And well, we created something like an association to shape a sector that does not exist, in industry terms. It existed only in B2B and in research. And today we are an association with corporate members - 80% of our members are corporate members - ranging from Airbus to Vattenfall, so users of hydrogen, but also transmitters and producers. And then we have national associations, and we have regions, so we have politicians in our membership, governors, policymakers. Overall, we are now 440 members, still growing.
ML Currently, Europe is using something of the order of 12 to 15 million tonnes of hydrogen. The overwhelming majority is grey from natural gas, or even black. A cynic would say, why are you working on anything other than greening the existing use of hydrogen?
JC We are spending more than 50% of our time on that. You're absolutely right, that's the low hanging fruit, to convert the existing grey hydrogen. In RePowerEU, the commission has come up with a proposal that 50% needs to be green by 2030; that's roughly four and a half million tonnes. That's cool, because if you oblige the industry to replace that, you have a level playing field for everybody, and that then creates demand. We want green hydrogen to be produced - ten million tonnes inside Europe, ten million tonnes outside, but you ask, how on earth can that be done without additional renewable infrastructure? We are teaming up with our friends from wind and solar, and geothermal, and we urge them to ramp up the infrastructure. Additionality - nothing against it. What we argue is, why the discrimination? Why should we discriminate hydrogen only? The scarcity is there for everybody. The Germans curtail on average €1 billion of renewable electricity. So, the grid is not big enough to consume all the renewable energy. At the same time, at peak times, they have not enough.
ML But Jorgo, this is a fantastic argument for grid investment, right? It's not a fantastic argument to choose a technology - hydrogen - which is three times less efficient in it use.
JC I understand you need to invest into electricity grids. However, if you calculate what's more expensive - the electricity grid, or the pipelines that you need to move molecules - it is eight times cheaper to produce this pipeline system. It doesn't make sense to wait until we have all the licenses and permitting for the grid: we have a climate issue. So, even if the efficiency that you put forward here is less, the overall system efficiency, due to the much lesser cost of this grid upgrade, is absolutely doable. That's the reason why hydrogen is so attractive, because it’s not just a carrier of energy, it's also a vector. It can store the energy, and that makes it so good.
ML This is a fantastic exposition of systems thinking which is categorically wrong. If the homework question is, you have electricity in one place, and you need electricity in the other place, then it's absolutely clear that electrical transmission is cheaper.
JC In in a scenario where we have 100% electric vehicles - 100% - it would cost the grid in Europe three to five trillion Euros. A combined system of electricity and hydrogen brings down the overall costs of the whole system to €1.1 to €1.2 trillion. So, to have two grids is cheaper than one grid. Also, you need 40 times less CRM in the hydrogen world. At a time where we have interruption of supply chains, with governments seeking urgently to have access to the CRM, that's a big argument. That's why governments look into hydrogen. If I put myself in the shoes of, let's say a European or German politician; I have the leading companies in producing trucks for hydrogen. If European Industries have a competitive advantage, why should I tell them, the hydrogen ladder of Michael says, you're not good, go to the US or go to South Africa? The other constraint that these guys have is they don't see the power grid being built up that fast, they don't see the storage capacities being built up that fast if it's not hydrogen. That's why they say, okay, we are in a hurry, we need to take this very bold decision to support hydrogen.
ML So, I totally understand that somebody making trucks would like to continue making trucks in Europe, but it doesn't matter what you want: if you get those calculations wrong, then you simply waste hundreds of billions. Let's talk about mobility. Why would you go to a system for that sector which requires enormously more build-out of electrolysis?
JC Did you see the amounts of electricity that we need for fast-charging trucks? Who on earth has that electricity? We instead would have pipelines to help us bring the hydrogen, not to the final fueling station, but to transport it over long distances. Second, you’re just considering green hydrogen. What about turquoise? Turquoise hydrogen will be a very important source. Don’t underestimate the pyrolysis hydrogen that will be in the system. So, it's not that we are cannibalizing; we are building up a new infrastructure, we are building up a redundant system also to cover one of the other big crises of humankind, which is plastic waste.
ML I want to come back to heating. You gave a talk at the Hydrogen Europe week, where you called me out from the stage for a piece that I wrote called "How Many Grifters Does It Take to Sell a Hydrogen Boiler?"
JC I personally have no hydrogen boiler at home, but I drive a hydrogen car for four and a half years now. 70,000 kilometers, no problem at all. So, I put question marks whenever these threats and Hindenburg things come up. No! Hydrogen technologies are super mature. You will have several ways of heating your home; you will have several ways of driving, but you should be technology-neutral. And if a technology is promising, don't exclude it; you don't know how the price will develop. 20 years ago, we were arguing about solar, everybody was saying, ah, too expensive. We need to see which technologies have access to abundancy to the abundant things on earth. Hydrogen is one. And obviously, the technologies that have not are dangerous and risky.