Policy instruments for supporting renewable hydrogen

Policy support for those applications that really need renewable hydrogen to become climate-neutral.

  • Project Duration: 12/2020 - 07/2021

All relevant climate neutrality scenarios entail a long-term need for renewable hydrogen. The study “Towards a Climate-neutral Germany by 2045” shows that in light of the more ambitious climate targets for 2030, significant amounts of renewable H₂ may already be needed by the end of this decade. According to the study, Germany will need around 60 TWh of CO₂-free hydrogen by 2030, partly to run power stations and combined heat and power (CHP) plants, and partly to supply the basic materials industry.

However, renewable hydrogen is not cost-competitive today. For successful market uptake, policy instruments are required to reduce and ultimately close the cost gap between renewable hydrogen and its fossil-based alternatives.

With the help of this analysis, we aim to identify the building blocks of a regulatory architecture for encouraging a renewable hydrogen economy in Germany and the EU. The objective is to to facilitate the rapid, predictable, and efficient growth of hydrogen supply and demand in a manner that contributes to the goal of climate neutrality.

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