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EU aims to produce 10 million tons of green hydrogen by 2030
2023/7/5
It is widely believed that Europe's goal is to make Africa a "hydrogen recharge station", and it is questioned that Europe may use it to plunder Africa's resources.
Recently, Germany, Egypt, the United Arab Emirates and Mauritania signed a $34 billion memorandum of understanding on hydrogen energy cooperation to build a 10 GW installed electrolyzer in Mauritania's capital, Nouakchott, with the aim of producing 8 million tons of green hydrogen per year for export.
In fact, this is just a microcosm of Europe's green hydrogen supply chain in Africa. Such cooperation has been increasing in recent years. It is widely believed that Europe's goal is to make Africa a "hydrogen resupply station", and it is questioned that Europe may be using it to plunder Africa's resources.
European-African green hydrogen cooperation has received mixed reviews
According to the Financial Times, the EU aims to produce 10 million tons of green hydrogen and import 10 million tons of green hydrogen by 2030. The EU believes that by forming a "green alliance" with Africa, which has vast untapped scenic resources, it can provide more facilities to achieve its own green hydrogen goals.
Last year, the EU signed agreements with Morocco, Egypt and Namibia to help these countries develop green hydrogen and seek to supply it to the EU where possible. The EU has also provided budget and technical support to Kenya, Mauritania and South Africa to promote the exploration of hydrogen development opportunities in these countries.
Donal Cannon, a non-EU adviser to the European Investment Bank, said the use of renewable electricity such as photovoltaics and wind power to electrolyze water for hydrogen could replace fossil fuels in the steel, chemical and shipping sectors. "For these hard-to-decarbonize industries, green hydrogen is an effective way to achieve sustainable development." According to him, "Green hydrogen production requires large amounts of cheap renewable electricity, so sunny Africa is an excellent clean energy location for hydrogen production, and Africa is well positioned to be a region where green hydrogen can be produced on a large scale at the lowest cost."
Rajiv Pandey, clean technology analyst at industry analyst firm Rexceed Energy, said, "Africa's unparalleled mineral reserves are critical for electrolyzer production, and the region's incredible renewable energy potential promises to not only transform energy flows, but create new ones."
EU Climate Commissioner Frans Timmermans even stated outright that Africa promises to be the powerhouse of the energy future.
However, the industry has mixed feelings about Europe's green hydrogen cooperation with Africa, and questions persist about Europe's "ill-intentioned" approach. The African Union notes that Africa has "extraordinary green hydrogen potential," but that any proposed project must be implemented carefully if it is to avoid being colonized again and to ensure that the African population benefits from a hydrogen economy.
It is understood that energy use in sub-Saharan Africa is currently very low, with more than 50% of the population living without electricity. In response, the European Commission said that Europe's goal is to build an equal partnership with Africa, that mutual benefits are a priority, and that establishing green hydrogen projects in local economies will contribute to "economic growth, social and political stability, job creation and industrialization.
The advantages of green hydrogen production in Africa are clear
According to data compiled by Rexceed Energy, Africa currently has a total of 114 GW of announced electrolyzer installations, 61% of which are related to sub-Saharan African countries, and most of which are targeted for export to Europe.
In the EU's view, Africa can be a cost effective and sustainable source of energy for Europe. The continent's low labor costs and renewable energy potential have always attracted Europe, with Egypt of particular interest.
It is reported that Egypt currently has 21 green hydrogen projects in the pipeline and is a leader among African green hydrogen producing countries. In addition, Mauritania's green hydrogen projects are also widely viewed by the industry due to its deep-water port location close to Europe and its vast export market.
The European Investment Bank states that Africa has the capacity to achieve an annual green hydrogen output of 1 trillion euros. The study found that the continent could produce 50 million tons of green hydrogen per year by 2035 at a production cost of less than €2/kg, a price that is considered economically viable.
The study by Aurora Energy Consulting in the UK found that imported green hydrogen would be the best option for sourcing clean fuel in Europe at a lower cost than producing it on the continent. Even after accounting for additional transportation and regulation costs, the price of green hydrogen imports would still be competitive. Transporting hydrogen in liquid form from Morocco to Germany is expected to be the most competitive option by 2030, at a cost of just $4.99/kg.
European resource plundering doubts hard to dispel
However, the European Business Observatory, an NGO, points out that the hydrogen cooperation agreed between Europe and Africa is more like a neo-colonial resource grab, and that it is unrealistic for Europe to set green hydrogen targets for Africa, both in terms of cost, and energy supply, and that renewable energy in Africa should be used to meet local energy needs and climate goals.
"Water, financing, cost, and transportation ...... are all issues that need to be considered." Godrej Rutomji, an energy transition analyst at the African Climate Foundation, a South African think tank, warned that "many of the proposed projects are in areas of severe water scarcity, and electrolysis of water for hydrogen would further increase the pressure on infrastructure and water supply security."
Data from the African Climate Foundation show that the European Investment Bank has provided only 5.3 billion euros ($5.7 billion) of investment in green infrastructure in Africa over the past 10 years, which is far from the scale of funding needed to achieve a massive transition, with Africa needing $32 billion a year for universal access to electricity alone.
Earlier this year, the European Commission signed an agreement with Africa committing millions of dollars to invest in green hydrogen production, but only 13 megawatts of the 114 gigawatts of total electrolyzer installations announced in Africa have made a final investment decision, according to a survey by RuiZiDe Energy.
The African Green Hydrogen Alliance states that creating a hydrogen economy will require investments of between $450 billion and $900 billion by 2050 in the six members of the Alliance, South Africa, Namibia, Egypt, Morocco, Kenya and Mauritania.
In addition, transporting green hydrogen from Africa to Europe is even more difficult. Rather than transporting hydrogen as a stand-alone product, it makes more sense to use a carrier fuel in the form of ammonia or methanol, but the cost and safety issues cannot be ignored, according to Godrej Rutomji.
Recently, Germany, Egypt, the United Arab Emirates and Mauritania signed a $34 billion memorandum of understanding on hydrogen energy cooperation to build a 10 GW installed electrolyzer in Mauritania's capital, Nouakchott, with the aim of producing 8 million tons of green hydrogen per year for export.
In fact, this is just a microcosm of Europe's green hydrogen supply chain in Africa. Such cooperation has been increasing in recent years. It is widely believed that Europe's goal is to make Africa a "hydrogen resupply station", and it is questioned that Europe may be using it to plunder Africa's resources.
European-African green hydrogen cooperation has received mixed reviews
According to the Financial Times, the EU aims to produce 10 million tons of green hydrogen and import 10 million tons of green hydrogen by 2030. The EU believes that by forming a "green alliance" with Africa, which has vast untapped scenic resources, it can provide more facilities to achieve its own green hydrogen goals.
Last year, the EU signed agreements with Morocco, Egypt and Namibia to help these countries develop green hydrogen and seek to supply it to the EU where possible. The EU has also provided budget and technical support to Kenya, Mauritania and South Africa to promote the exploration of hydrogen development opportunities in these countries.
Donal Cannon, a non-EU adviser to the European Investment Bank, said the use of renewable electricity such as photovoltaics and wind power to electrolyze water for hydrogen could replace fossil fuels in the steel, chemical and shipping sectors. "For these hard-to-decarbonize industries, green hydrogen is an effective way to achieve sustainable development." According to him, "Green hydrogen production requires large amounts of cheap renewable electricity, so sunny Africa is an excellent clean energy location for hydrogen production, and Africa is well positioned to be a region where green hydrogen can be produced on a large scale at the lowest cost."
Rajiv Pandey, clean technology analyst at industry analyst firm Rexceed Energy, said, "Africa's unparalleled mineral reserves are critical for electrolyzer production, and the region's incredible renewable energy potential promises to not only transform energy flows, but create new ones."
EU Climate Commissioner Frans Timmermans even stated outright that Africa promises to be the powerhouse of the energy future.
However, the industry has mixed feelings about Europe's green hydrogen cooperation with Africa, and questions persist about Europe's "ill-intentioned" approach. The African Union notes that Africa has "extraordinary green hydrogen potential," but that any proposed project must be implemented carefully if it is to avoid being colonized again and to ensure that the African population benefits from a hydrogen economy.
It is understood that energy use in sub-Saharan Africa is currently very low, with more than 50% of the population living without electricity. In response, the European Commission said that Europe's goal is to build an equal partnership with Africa, that mutual benefits are a priority, and that establishing green hydrogen projects in local economies will contribute to "economic growth, social and political stability, job creation and industrialization.
The advantages of green hydrogen production in Africa are clear
According to data compiled by Rexceed Energy, Africa currently has a total of 114 GW of announced electrolyzer installations, 61% of which are related to sub-Saharan African countries, and most of which are targeted for export to Europe.
In the EU's view, Africa can be a cost effective and sustainable source of energy for Europe. The continent's low labor costs and renewable energy potential have always attracted Europe, with Egypt of particular interest.
It is reported that Egypt currently has 21 green hydrogen projects in the pipeline and is a leader among African green hydrogen producing countries. In addition, Mauritania's green hydrogen projects are also widely viewed by the industry due to its deep-water port location close to Europe and its vast export market.
The European Investment Bank states that Africa has the capacity to achieve an annual green hydrogen output of 1 trillion euros. The study found that the continent could produce 50 million tons of green hydrogen per year by 2035 at a production cost of less than €2/kg, a price that is considered economically viable.
The study by Aurora Energy Consulting in the UK found that imported green hydrogen would be the best option for sourcing clean fuel in Europe at a lower cost than producing it on the continent. Even after accounting for additional transportation and regulation costs, the price of green hydrogen imports would still be competitive. Transporting hydrogen in liquid form from Morocco to Germany is expected to be the most competitive option by 2030, at a cost of just $4.99/kg.
European resource plundering doubts hard to dispel
However, the European Business Observatory, an NGO, points out that the hydrogen cooperation agreed between Europe and Africa is more like a neo-colonial resource grab, and that it is unrealistic for Europe to set green hydrogen targets for Africa, both in terms of cost, and energy supply, and that renewable energy in Africa should be used to meet local energy needs and climate goals.
"Water, financing, cost, and transportation ...... are all issues that need to be considered." Godrej Rutomji, an energy transition analyst at the African Climate Foundation, a South African think tank, warned that "many of the proposed projects are in areas of severe water scarcity, and electrolysis of water for hydrogen would further increase the pressure on infrastructure and water supply security."
Data from the African Climate Foundation show that the European Investment Bank has provided only 5.3 billion euros ($5.7 billion) of investment in green infrastructure in Africa over the past 10 years, which is far from the scale of funding needed to achieve a massive transition, with Africa needing $32 billion a year for universal access to electricity alone.
Earlier this year, the European Commission signed an agreement with Africa committing millions of dollars to invest in green hydrogen production, but only 13 megawatts of the 114 gigawatts of total electrolyzer installations announced in Africa have made a final investment decision, according to a survey by RuiZiDe Energy.
The African Green Hydrogen Alliance states that creating a hydrogen economy will require investments of between $450 billion and $900 billion by 2050 in the six members of the Alliance, South Africa, Namibia, Egypt, Morocco, Kenya and Mauritania.
In addition, transporting green hydrogen from Africa to Europe is even more difficult. Rather than transporting hydrogen as a stand-alone product, it makes more sense to use a carrier fuel in the form of ammonia or methanol, but the cost and safety issues cannot be ignored, according to Godrej Rutomji.
Given the challenges of establishing a complete green hydrogen value chain, it is hard to be optimistic about Europe's placement in Africa. "Hydrogen will definitely become the protagonist of a sustainable economy, but we remain on the fence about the placement of such investments and projects in Africa," said Edwat Sukhotanka, vice president of digitalization for smart infrastructure at Siemens.
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