The European Commission’s Clean Hydrogen Alliance, promoted by Poland and Germany, could be one of the ways to preserve European unity in the face of the looming economic crisis caused by the coronavirus pandemic, writes Wojciech Jakóbik.
Wojciech Jakóbik is chief editor at BiznesAlert.pl, an online business newspaper based in Warsaw.
The European Commission is struggling to give a coherent European response to counter the economic impact of the coronavirus pandemic. It has proposed various measures including state aid, fiscal flexibility and solidarity on the single market, all undermined by the actions of various member states.
Two examples of this are different countries’ decision to close borders despite the freedom of movement guaranteed by the Schengen Agreement, and initial reluctance to share medical equipment with other nations.
This is an alarming sign of isolationism, which should be countered across the EU.
The crisis of unity can also be seen in the context of the new, ambitious European project called the European Green Deal. It is a multi-sector set of regulatory and political measures with an aim of achieving climate neutrality of the European Union by 2050. The plan is questioned by different actors, including Polish officials mulling over freezing the EU emission trading scheme for the duration of the pandemic, to give some breathing room to the European economy hit hard by the coronavirus outbreak.
The truth is that the green turn postulated by the European Commission could bring economic benefits and make the coronavirus aftermath less painful. However, the EC’s proposal to increase the EU climate goal by reducing CO2 emissions not by 40%, but by 50-55%, would be hard to defend in times of crisis.
There are other solutions and plenty of room for constructive cooperation within the EU that could contribute to achieving climate neutrality. And the European Commission’s proposal for a Clean Hydrogen Alliance is one of them.
First of all, it should be stressed that green hydrogen is the most sustainable long-term solution. The blue hydrogen technology that requires natural gas in the production process creates risks already well-known by the European Commission. Blue hydrogen could cause dependence on external suppliers with Russia being one of the biggest sellers. It could also entice Moscow to transmit blue hydrogen, manufactured by its high-emission natural gas sector, via the Nord Stream 2 pipeline. Such a scenario would be counterproductive to achieving the goals set by the European Green Deal.
Business circles across the continent are already talking about launching a hydrogen alliance in Europe. Poland and Germany have both announced they were working on hydrogen strategies. The Fraunhofer Institute for Solar Energy Systems’ Hydrogen Roadmap for Germany assumes that it would be possible to produce 1 GW’s-worth of green hydrogen annually as of 2020.
If Germany is able to promote electrolysers that produce hydrogen from water with renewable energy sources at a global capacity of 3,000 GW in 2050, it would bring around €32 billion of added value for the German economy. A similar effect could be achieved at the European level, especially with the help of pan-European cooperation.
Such a development would create an entirely new industry and jobs. This would help overcome the possible coronavirus economic crisis and make the climate neutrality goal more achievable. Green hydrogen produced with renewable electricity could fuel the heavy industry that currently relies strongly on coal.
This transformation is being discussed by the biggest players in Europe’s industry, energy and gas sectors. It is a way to overcome the existing differences between member states by offering constructive cooperation in an innovative economic sector.
We are currently in the midst of a huge discussion on how to use various subsidies to support the EU economy in times of crisis. Maybe one of the answers is to promote green hydrogen coming from Poland, Germany and other parts of the continent?