HYDROGEN TOO EXPENSIVE EVEN FOR EUROPE, SAY COMMODITY TRADERS

“Green” hydrogen is extremely expensive, but “green” energy production in Europe is quite competitive.

Producing hydrogen in Europe and even importing it is too expensive, Gunvor trader chief Torbjorn Tornqvist said at the international ADIPEC conference.

In particular, according to Gunvor, producing “green” hydrogen (obtained by electrolysis of water using renewable energy sources) in Germany is “extremely expensive,” Törnqvist quoted Interfax as saying. The supply of hydrogen is also not a cheap undertaking, as logistics costs are high.

Answering journalists' questions, Törnqvist also cited the following estimate made by Saudi Aramco: “green” hydrogen produced in Saudi Arabia in oil equivalent terms will cost $300-400 per barrel, “blue” hydrogen (produced from natural gas with captured emissions) – $250. -300 barrels. And this is very expensive, no one will pay such a price in Europe (and, we add, even more so outside of it). So hydrogen energy is a possible future (and, it seems, hardly the present) of Europe.

The director of the trading company sees a way out in “green” energy – solar, for example – which in Europe is “very competitive”.

His colleague, Vitol trader Russell Hardy, in turn said that hydrogen projects are not only unprofitable, but also carry regulatory risks. He does not hide the fact that companies are counting on government support when calculating hydrogen projects. But what if the investment is made and regulation is relaxed? The economics of all projects, including competitive ones, are changing, but the money has already been spent. In general, Hardy said, governments and companies need to work more closely together in this segment.