Policy Brief - Does Hydrogen Have a Place in the Energy Transition?

Germany, as part of its Energiewende, is counting on hydrogen to store massive quantities of intermittent energy from renewable sources (RES). The question has been raised whether this approach to energy transition is applicable in France.

This policy brief provides a particularly cautious response. Today, hydrogen is only produced for industrial purposes using a process that emits CO2. Carbon-free generation of hydrogen is technically possible by electrolysing water, but the efficiency is poor and the costs are high. Using this approach to enhance the value of excess renewable energy risks increasing the price of electricity. There is ample enthusiasm in Germany for hydrogen powered vehicles, but it does not appear that they will be able to compete with combustion or electric powered vehicles for a long time because fuel cell technology is not yet mature. Additionally, the deployment of a distribution infrastructure would be quite
costly.

We therefore recommend conducting further R&D work on electrolysers and fuel cells before considering their substantive or experimental deployment. An impact assessment of hydrogen solutions must take into account, among other things, the economic consequences on other energy sectors (gas, electricity, fuels) and the safety issues.

Costs of Hydrogen Production

Summary:

• Production cost remains high for carbon-free hydrogen energy
• Industrial uses of hydrogen
• Hydrogen energy: storing electricity
• Niche applications for hydrogen
• Medium and long term prospects
• Authors: Etienne Beeker, Sustainable Development Department