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In 2020, the newly constituted government grandiosely announced that Austria will become the "number one hydrogen nation". But is this even remotely realistic just two years later?
Hydrogen is used in a wide variety of ways, for example in the chemical or food industries. Today, it is produced mostly through steam reforming, partial oxidation or similar processes. These processes create huge greenhouse gas (GHG) emissions. An alternative (almost) GHG-emission free way to produce hydrogen is to split water through electrolysis. So far, this process has not been deployed on an industrial scale due to its relatively higher cost (about four times more than via steam reforming) and technical limitations.
Nevertheless, due to the urgency of the fight against climate change, this should change significantly in the near future, according to the plans of the EU and other international players. As cost and technical limitations diminish, electrolysis should also be used to ramp up the production of hydrogen for the steel, cement and fuel industries or in the transport sector. Ultimately, since hydrogen can both be produced from electricity (and water) and be used to produce electricity (in fuel cells), it should also be used as (emission-free) electricity storage.
In short, there are vast opportunities linked to the emission-free production and use of hydrogen. Policymakers are therefore striving to facilitate its production, transport and use. In order to do so, massive subsidies will be required for the scale-up of "clean" hydrogen production and transport as well as modifications of industrial processes. Since hydrogen allows for an even closer interconnection between the gas and the electricity sectors, market regulations also require immediate attention. Finally, the permitting regimes for the production, storage and processing of hydrogen were obviously not designed for a hydrogen-based economy and likewise require several adaptations in order to facilitate the ambitious plans.
"The permitting regimes for the production, storage and processing of hydrogen were obviously not designed for a hydrogen-based economy and require several adaptations in order to facilitate the ambitious plans."
In 2021, Austria took the first steps towards promoting hydrogen-related projects in the Renewable Energy Package (Erneuerbaren-Ausbau-Paket), under which the following have been put in place:
Further legal acts – as well as the national hydrogen strategy paper – were already announced in 2019 but did not undergo a broader public participation procedure until late 2021.
The Renewable Energy Package 2021 undoubtedly was a first step towards achieving the ambitious goals set both by the EU and the Austrian Government. However, the currently low number of pilot projects in the (renewable) hydrogen sector and our experience in advising on hydrogen-related projects show that the road to becoming even a "top 10" hydrogen nation is still long. The most pressing obstacles are:
While some of the obstacles can be tackled (at least to some extent) on a national level, others such as market regulations and certain questions regarding the planning and permitting regimes must be resolved on an EU level. We are positive and will continue to do our part to ensure that 2022 will take the National and European endeavours towards a hydrogen economy even further.
author: Christoph Cudlik
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