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The Black Sea region is emerging as the next hydrogen hub

The International Renewable Energy Agency (IRENA) estimates that hydrogen will account globally for 12 per cent of final energy use by 2050. It will play an important role in hard-to-decarbonise, energy-intensive sectors like steel, chemicals, long-haul transport, shipping and aviation. Hydrogen will also help balance renewable electricity supply and demand and serve as long-term seasonal storage. Some 5,000 gigawatts (GW) of electrolyser capacity will be needed by 2050, up from 0,3 GW today. And South-Eastern Europe is particularly suited for such production.

Cristian Carraretto, hydrogen coordinator at the European Bank for Reconstruction and Development (EBRD) believes that advanced-economy areas such as the European Union, which already have ambitious hydrogen strategies in place as part of their decarbonisation push, are leading the way in promoting hydrogen. But, as Mr Carraretto noted, neighbouring countries – not least those in the EBRD regions of Central and Eastern Europe, Central Asia and the Southern and Eastern Mediterranean – could be in “an extremely good position to react very quickly.”

Indeed, the EBRD is supporting Georgia in its quest to explore the country’s potential for generating green hydrogen using its vast water resources and Turkey held a 2020 hydrogen conference, whose aim was to focus on indigenous energy sources, which includes hydrogen production from local coal mines.

Hydrogen key to decarbonise the heating sector in Turkey

Turkey’s Ministry of Energy and Natural Resources (MENR) sees hydrogen playing an important role alongside renewables and key to decarbonise the heating sector through the blending of hydrogen with methane on the gas distribution system. However, according to law firm CMS, the use of low-carbon hydrogen in industrial and heating processes requires more research in order to be a truly viable option in Turkey.

“Green hydrogen could have a potential of 5 per cent in Turkey’s energy mix as a low-carbon alternative for transport and buildings,” commented Hasan Aksoy, Acting Director and Head of Research at the SHURA Energy Transition Centre.

“Turkey’s energy dependence continues,” he said during the Black Sea Energy Week 2021, organised by UK-based Invest In Network and which took place in Bucharest on 28-29 September. “Therefore priority areas for the country include the development of a hydrogen strategy, whose applications could include transport, buildings (if blended with natural gas) and industry. Also, we must find a way to mobilise the right financing.”

According to the MENR its approach to hydrogen production has four main aims: first to create more renewable energy for Turkey; second, to ensure emission-free production in the heat sector; third, to produce hydrogen from domestic coal; and finally, to increase the use of boron and its use in hydrogen storage.

hydrogen black sea
Black Sea Energy Week, hydrogen panel

Ukraine’s hydrogen momentum

Hydrogen is also gaining increased recognition in Ukraine. The EU considers Ukraine to be a priority partner to implement the European Hydrogen Strategy as it stands out for its hydrogen output and transport capacity. In this regard, the Ukrainian Hydrogen Council was the first member of Hydrogen Europe from a non-European Union country, a historical moment for Ukraine and the development of hydrogen in the country.

“Potential areas of development of hydrogen include the exploitation of offshore and onshore wind and solar,” said Oleksandr Diachenko, vice-president of the Ukrainian Hydrogen Council.

He mentioned several ongoing projects in the country, such as the certification of the first hydrogen car in Ukraine, earlier in September.

“For the moment there are two hydrogen cars in Ukraine,” he said. “But, the basis for further development of infrastructure for hydrogen transport in Ukraine was established and now we are developing a project to create a national network of hydrogen filling stations.”

Among other mentioned projects there is the H2U, whose goal is to create an energy cluster in the region focused on the production of electricity from renewable energy sources, the production of green hydrogen and its export to the countries of the EU. The choice of the project implementation in the Southern Bessarabia is conditioned by the following factors: high potential for solar and wind activity, available freshwater resources, competitive logistics routes to the consumer and developed infrastructure.

In particular, Mr Diachenko sees the potential of green hydrogen converted to ammonia for transportation purposes and as a standalone commodity. Indeed, the green ammonia produced can be used for cracking back into green hydrogen, or as a bunker ship fuel, as a commodity for the production of fertilisers or as a fuel for turbines and fuel cells.

“Also, liquid hydrogen could be an option, but we need to see when the technology will be ready,” he told CEENERGYNEWS.

Overall, it is estimated that approximately 505,133 million cubic metres (mcm) of green hydrogen could be produced in Ukraine annually. Also, in Ukraine 50 per cent of the electricity comes from nuclear, thus including the possibility to use pink hydrogen.

Hydrogen: one of Romania’s major industries

Nuclear is a possibility also in Romania, where hydrogen has a good chance of emerging as one of the country’s major industries, with projects with a value of over 1,6 billion euros being analysed by Romania’s top energy and industrial companies.

Romania is included in the group of countries that traditionally produce hydrogen. Ioan Iordache, from the Romanian Association for Hydrogen Energy, recalled that for the first time in the world, hydrogen was obtained by hydrolysis of water and cracking of methane in 1937 in Tărnăveni, central Romania.

Now, law firm CMS reminds that, according to the Integrated National Plan in the field of Energy and Climate Change 2021-2030, submitted to the European Commission in April 2020, Romanian authorities are considering the implementation of a number of pilot and demonstration projects to promote the use of hydrogen in the production of electricity and in the industrial sectors.

At present, hydrogen is used mainly in the chemical industry, specifically in refineries and for ammonia production. But research is underway. The National Hydrogen and Fuel Cell Centre (ICSI) is developing and implementing projects on new technologies and was a partner to the HyUnder project whose aim was to assess the potential, the actors and relevant business cases for large scale and seasonal storage of renewable electricity by hydrogen underground storage in Europe.

Romania has yet not developed hydrogen specific legislation. However, Dan Dragos Dragan, Secretary of State at the Ministry of Energy of Romania mentioned the possibility of developing a national hydrogen strategy “so to make Romania an innovative hub for new technologies.”

International investors are looking at the region

International companies investing in the region are recognising this potential.

European Energy develops, finances, constructs and operates wind and solar farms as well as large-scale Power-to-X plants. Based in Denmark, the company has a strong track record as a renewable energy operator across Europe, Brazil, the US and Australia. Thorvald Spanggaard, Project Director at European Energy, noted that the number of hydrogen-related M&A transactions in the first half of 2021 increased by over 100 per cent compared to the same period of 2020. Power-to-X is indeed the right choice for decarbonising hard-to-abate sectors like heavy transport, energy-intensive industry (including steel) as well as heating of buildings and industrial processes.

STE Energy, an Italian company operating on an international scale in the renewable energy and electricity infrastructure sectors is also investing in the region, with a presence in Albania, Armenia, Hungary and Romania. Earlier in April, the company signed a contract for Very Low Head (VLH) turbine supply in Georgia, which was the first installation of such advanced technology in the Caucasus, paving the way for other similar projects meant to harness the huge hydropower potential of the area.

When it comes to hydrogen, STE Energy integrates electrolysers with RES sources, thus ensuring that the hydrogen produced is green. However, as underlined by Lorenzo Montemezzo, Sales Director, for hydrogen to be really competitive the costs of the electrolysers must decrease by about 6 times. Speaking at the Black Sea Energy Week, he mentioned the possibility for electrolysers to cost around 150 euros/kW by 2050, while renewables prices will keep decreasing (12 euros/MWh for solar and 17 euros/MWh for onshore wind). Thus, as part of its steady effort supporting the global decarbonisation process, STE Energy has been awarded a contract for the design, supply and installation of a hydrogen system meant to store and manage energy for the Noi TechPark in Bruneck, North of Italy.

A project that should be replicable also in the Black Sea region, considering the high volatility of renewables. And, although the lack of regulations and proper infrastructure are still the major challenges for the region to overcome, the Black Sea countries could not only become a corridor for renewable energy, but also a hub for innovative technologies and hydrogen production.

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