Why North Africa should not export green hydrogen to Europe [rapport]

Why North Africa should not export green hydrogen to Europe [rapport]

Morocco, Algeria and Egypt have no interest in exporting green hydrogen to Europe. At least that is what a report published by the Dutch think tank Transnational Institute (TNI) and the Brussels-based Industrial Europe Observatory (CEO) suggests. Entitled “Assessing EU plans to import hydrogen from North Africa”, the report takes stock of European demand for green hydrogen and the climate needs and objectives of North African countries.

For several years, North Africa has positioned itself as a partner of choice for the European Union, in search of carbon-free energy. The many projects developed in Morocco around green hydrogen have also hoisted the country into the top 5 of the “future world player in hydrogen” according to the Financial Times.

However, this study published on May 17 considers that the export of hydrogen from North African countries to Europe is not economically viable. For the TNI and the CEO, the development of green hydrogen for export is “expensive, untested and potentially not economically viable”. This race to export green hydrogen to Europe would be harmful to North African economies, add the authors.

So Morocco, Algeria and Egypt would have more interest in “using renewable electricity, solar and wind, at the local level and sharing it with neighboring countries in Africa and possibly the Middle East through of interconnections. This would be a much more effective option than trying to create an export market for very expensive chemicals”.

Green hydrogen, an expensive and inefficient energy

The study indeed shows that the production of green hydrogen is very expensive today and is likely to remain so. For green hydrogen to compete with gray hydrogen, which costs 50 euro cents less to produce per kilo, the price of the energy needed to create it should drop drastically. Also, the cost of producing green hydrogen depends greatly on the cost of electrolysis and the production of green energy, its conversion, transport and storage, which are currently too expensive to compete with the production of gray hydrogen.

In concrete terms, producing green hydrogen can cost up to 11 times more than using natural gas, the authors of the report estimate. “If Europe is not prepared to pay the difference between green hydrogen and natural gas, North African governments should be wary of promises of large export markets,” it adds.

Furthermore, producing green hydrogen is “relatively energy inefficient, and using it as a power source is also inefficient,” the report adds. It is estimated that almost 60% of renewable energy is “wasted” in the production of green hydrogen. Using this hydrogen as a heat source is relatively more efficient, it adds.

Who should benefit from Moroccan green energies?

In Morocco, the production of green hydrogen “does not offer much viable potential”. However, Morocco could, as it envisages, use green hydrogen to eliminate the high emissions caused by ammonia by replacing it for the production of fertilizers. However, the technologies involved in this production of green ammonia using hydrogen are “unproven” in this case and no independent verification has been carried out as to their feasibility, which makes this bet risky, believe the authors.

Also, for the latter, the various projects under development with Germany (power to X) involve high production costs, due to the great need for electricity which could not be covered by the solar and wind installations currently in place.

The export of Moroccan hydrogen to Europe is also energy-intensive and very expensive. Indeed, it takes three times more energy to liquefy hydrogen than natural gas. Additionally, the energy density of hydrogen is smaller than that of liquefied natural gas, so a ship of the same volume could only carry 27% of the energy in hydrogen that it could carry in gas. natural.

For the authors of the study, Morocco would therefore do better to use its renewable energy to reduce the CO2 emissions caused by its consumption of coal to produce electricity. This transition would avoid the emission of more than 27 million tons of CO2 per year, it is estimated.

“It doesn’t make sense for Morocco to use its renewable electricity to make hydrogen and hydrogen products, since it ships them to Europe wasting a lot of energy, so the EU can achieve higher climate emission reductions,” concludes the Morocco case report.