EnBW Invests €1 Billion in National Hydrogen Network

EnBW, a major player in the German energy sector, is investing €1 billion in the development of the national hydrogen transport network. This network, designed to transport both locally produced and imported hydrogen, is crucial for reducing Germany’s reliance on fossil fuels.

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EnBW Planning and Approval Process

The industrial association FNB Gas, representing gas network operators, has submitted a national planning request to the Bundesnetzagentur (Federal Network Agency). This project plans to construct 9,666 kilometers of pipelines by 2032, with a total estimated cost of €19.7 billion. These pipelines will transport 278 terawatt-hours (TWh) of hydrogen annually, approximately one-third of Germany’s gas consumption in 2021.

EnBW Hydrogen Network Objectives and Planning

The German energy regulator, Bundesnetzagentur, has received FNB Gas’s detailed plans, which include converting existing natural gas pipelines to hydrogen pipelines and building new infrastructure. Regulatory approval is expected in September 2024, with construction slated to begin in 2025. Germany aims to position itself as a leader in the hydrogen economy in Europe.

Limited wind and solar energy resources in Germany compel the country to import around 70% of its future hydrogen from regions capable of producing it abundantly and at low cost. Thus, this national hydrogen network project fits into a broader energy transition strategy to decarbonize the economy.

Funding and Outlook

The funding for this infrastructure will be managed through amortization accounts, spreading costs across multiple generations. Network operators will invest from their own balance sheets and recoup expenses mainly through network fees, with the potential to attract investment from financial markets. About 60% of the infrastructure projects involve converting existing natural gas pipelines to transport hydrogen, while new pipelines will also be constructed.

EnBW, along with its subsidiaries VNG and terranets, plans initial investments to connect regional transport lines in eastern and southwestern Germany. These investments will then extend beyond these regions to create an integrated and efficient network for hydrogen transport.

Economic and Environmental Impact of Hydrogen Network

Hydrogen, when produced by electrolysis using renewable electricity, represents a clean alternative to fossil fuels. Given Germany’s limited wind and solar resources, the country plans to import around 70% of its future hydrogen from regions where it can be produced in abundance and at low cost.

The hydrogen network project is integral to Germany’s efforts to meet its climate goals and reduce its dependence on fossil fuels, while promoting the transition to a low-carbon economy. The initiative also offers new market opportunities for investors and businesses in the energy sector.

EnBW and its subsidiaries play a key role in this project, with plans to convert existing pipelines and build new infrastructure to create an efficient and integrated hydrogen transport network. Berlin Gasag’s involvement, including the conversion of 60 kilometers of city gas pipelines to hydrogen, underscores the national commitment to this transition.

This ambitious project marks a significant step toward decarbonizing the German economy. The construction of the hydrogen network, expected to start in 2025, is a crucial phase in this transition. EnBW’s investment in this national project highlights the strategic importance of hydrogen for Germany’s energy future.

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(Featured image by Wolfgang Weiser via Unsplash)

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First published in energynews. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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