H2Heat March Newsletter

Welcome to the March 2025 edition of the H2Heat Project Newsletter! As we continue our mission to demonstrate the complete value chain of green hydrogen for heating commercial buildings, we are excited to share the latest developments in the European hydrogen industry. These advancements highlight the growing momentum in the sector and provide valuable insights that can inform and inspire our work within the H2Heat project.

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INDUSTRY HIGHLIGHTS

EU Approves €400m in Renewable Hydrogen Funds

The European Commission has approved a €400 million Austrian state aid scheme and a €36 million Lithuanian state aid scheme to support the production of renewable hydrogen, bolstering the EU’s commitment to green energy initiatives.

Austria’s initiative

Austria’s initiative aims to support the production of up to 112,000 tonnes of renewable hydrogen, potentially reducing CO₂ emissions by approximately 536,000 tonnes.  The financial support will be provided as direct grants per kilogram of renewable hydrogen produced, with a maximum duration of ten years. Beneficiaries are required to comply with EU criteria for the production of renewable fuels of non-biological origin (RFNBOs), ensuring that the additional renewable electricity needed for hydrogen production is deployed or financed under the scheme.

Lithuania’s scheme

Lithuania’s scheme is designed to support the production of up to 13,000 tonnes of renewable hydrogen, aiming to cut CO₂ emissions by approximately 61,000 tonnes.  Similar to Austria’s approach, the Lithuanian scheme will provide direct grants per kilogram of renewable hydrogen produced over a maximum period of ten years. Beneficiaries must adhere to the same EU RFNBO criteria, ensuring the deployment or financing of additional renewable electricity required for hydrogen production. 

Alignment with EU Objectives

Both schemes are integral to the European Union’s broader strategies, including the Clean Industrial Deal, the REPowerEU Plan, and the EU Hydrogen Strategy. These initiatives aim to accelerate the decarbonization of EU industry, reduce dependence on fossil fuels, and promote the transition to a green economy.

Thyssenkrupp’s Green Steel Project Faces Economic Uncertainty

Thyssenkrupp’s CEO, Miguel Lopez, has expressed concerns regarding the economic viability of the company’s planned €3.3 billion plant in Duisburg, aimed at producing carbon-neutral steel. The project’s success is contingent upon the availability of sufficient green hydrogen, which Germany has yet to secure. Initially, the project was based on the assumption that ample affordable green hydrogen would be accessible upon completion—a premise now deemed overly optimistic. Under the current circumstances, Lopez cautioned that the plant might not be economically sustainable, potentially leaving it without the needed green hydrogen supply. Additionally, Thyssenkrupp is planning to sell a further 30% stake in its steel division, Thyssenkrupp Steel Europe, to EP Group, which already holds a 20% stake. 

Grangemouth Refinery’s Potential Transformation into Green Fuels Hub

Scotland’s First Minister, John Swinney, has announced the potential transformation of the Grangemouth oil refinery into a leading hub for green chemicals, sustainable fuels, and plastics. The refinery’s closure by owners PetroIneos will result in the loss of 400 jobs, impacting up to 2,000 jobs in eastern Scotland. Swinney highlighted the necessity for a just transition from fossil fuels to net-zero approaches, while the UK and Scottish governments’ report by EY suggested that the site could create up to 1,200 jobs by attracting low-carbon businesses, requiring investment between £3.5bn to £7.5bn. The UK government has pledged £200m and the Scottish government £25m for green business support. Despite skepticism from analysts and campaigners about some proposed technologies, local firms like Celtic Renewables support the optimistic outlook for repurposing the facility for green manufacturing with substantial investment from agencies like Scottish Enterprise.

RWE and TotalEnergies Sign Long-Term Green Hydrogen Supply Deal

German utility RWE has entered a substantial long-term agreement with French oil major TotalEnergies to supply approximately 30,000 tonnes of green hydrogen annually starting from 2030. The hydrogen will be produced at RWE’s 300-megawatt electrolysis plant in Lingen.

Southern Hydrogen Corridor Gains Momentum with Joint Declaration

The Southern Hydrogen Corridor project has taken a significant step forward with the signing of a Joint Declaration of Intent by representatives from Germany, Algeria, Italy, Austria, and Tunisia. This agreement, formalized during a ministerial meeting in Rome on January 21, 2025, underscores a collective commitment to developing a dedicated hydrogen pipeline connecting North Africa to Europe. 

Project Overview

The Southern Hydrogen Corridor, also known as the SoutH₂ Corridor, envisions a pipeline spanning approximately 3,300 to 4,000 kilometers. This infrastructure aims to transport renewable hydrogen produced in North Africa to key European demand centers in Italy, Austria, and Germany. The project comprises five sub-projects, with the European segment planned to be about 3,250 kilometers long, utilizing 60-70% repurposed natural gas pipelines. This approach is expected to enable the transport of up to 163 terawatt-hours (TWh) of green hydrogen annually to Europe.

Strategic Significance

Dr. Philip Nimmermann, State Secretary at the German Federal Ministry for Economic Affairs and Climate Action (BMWK), highlighted the project’s importance, stating that the Southern Hydrogen Corridor will be one of the “largest and most significant” renewable energy initiatives of our time.  The corridor is designed to supply low-cost renewable hydrogen produced in North Africa to European demand clusters, contributing significantly to Europe’s energy diversification and sustainability goals.

Institutional Support

The initiative has received political endorsement from the participating countries and has been included in the European Commission’s list of Projects of Common Interest (PCI). This designation recognizes the project’s strategic importance and may facilitate access to funding and streamlined regulatory processes.

H2HEAT INSIGHT

As the H2Heat project advances, we are dedicated to integrating recent industry developments to enhance our initiatives. Our current focus encompasses:

Innovative Hydrogen Production

We are harnessing offshore wind energy from Esteyco’s 5 MW ELICAN wind turbine, located off the coast of Gran Canaria, to power a state-of-the-art 1 MW electrolyzer. This electrolyzer, supplied by Stargate Hydrogen, will produce green hydrogen specifically for heating applications within the Complejo Hospitalario Universitario Insular Materno Infantil (CHUIMI). The electrolyzer is set to be installed at the PLOCAN site on Gran Canaria.

Advanced Combustion Technologies

In collaboration with 2G, we are implementing a 100% hydrogen-powered combined heat and power (H2-CHP) system at CHUIMI. This system is designed to meet over 50% of the hospital’s heating requirements, significantly reducing reliance on conventional fuels and contributing to the Canary Islands Health Service’s Zero Net Emissions 2030 Health Strategy.

Comprehensive Energy Management

Our team is developing sophisticated control systems, including Energy Management Systems (EMS) and Demand Management Systems (DMS), to optimize hydrogen production and utilization. These systems aim to ensure efficient integration of renewable energy sources, balancing supply and demand, and maximizing the sustainability of our heating solutions.

These efforts align with our mission to demonstrate the full value chain of green hydrogen production and its application in commercial building heating, thereby contributing to the decarbonization goals of the Canary Islands’ health sector.