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Europe Hydrogen Forum

An IHS Markit initiative considering the potential role of hydrogen in a net-zero carbon world

In 2018, the European Commission announced the objective of reaching a “net zero-carbon world” for its revised 2050 energy roadmap. If the European Union agrees to adopt this target, there will be no role by midcentury for the combustion of unabated natural gas in EU countries.

Hydrogen is one option that is receiving increased attention. Hydrogen and other green gases can address the short-term need for rapid greenhouse gas abatement while providing a long-term storage solution. It can be used for power generation, heat, industrial uses and transport – while using Europe’s gas infrastructure already in place.

IHS Markit has built structured, sectoral insight and a unique cross-industry space with a community of 150+ representatives from 30+ organizations to monitor change in Europe’s markets.

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Europe Hydrogen Forum Structure

  • Two meetings during the year – Spring and autumn
  • Location: A ‘hydrogen-interesting’ location
    • Suggestions: Leeds, U.K., to include a presentation by H21, Northern Gas Networks, an area with hydrogen infrastructure in the Netherlands; a hydrogen plant in southern France or Brussels, to include policymakers in the process
  • A two-day session for each meeting:
    • Day one – Visit and dinner
    • Day two – Presentation on specific topics, including:
      • Supply – Hydrogen production options from biomass/waste, options for hydrogen imports, costs of biomethane, synthetic gases and more
      • Infrastructure – Is synthetic methane or are other synthetic fuels a better option than hydrogen?
      • Policy – Current/prospective European policies on hydrogen
      • Scenarios – A net-zero carbon scenario using hydrogen
      • Renewable partnerships – Analysis of the interaction between hydrogen and renewable deployment in the power sector
      • Investment – Estimated capital and operating expenditures by segment to help identify investment challenges

Available Deliverables

Technology Status

  • Technologies for the manufacture of hydrogen, comparing the capital expenditure requirements, operating and maintenance costs, and efficiency
  • Comparison of manufacture by electrolysis using zero-carbon renewable electricity (“green hydrogen”) and by steam-reforming of methane (“blue hydrogen”) with carbon capture and storage

Practicality

  • Practical issues surround the rollout of hydrogen into the energy mix:
    • Suitability of existing gas distribution for injection of hydrogen or conversion to pure hydrogen
    • Need for hydrogen storage and suitability of various solutions
    • Safety aspects of hydrogen use in different circumstances
    • Conversion of equipment and consumer appliances to use hydrogen
    • Refueling network requirements for transportation sector
    • Appropriate regulatory frameworks will be needed to encourage development of hydrogen
    • Market competition (e.g., battery electric vehicles in the mobility sector, and heat pumps for space heating)

Tipping Points

Tipping points that could trigger hydrogen’s launch from a niche fuel to a significant part of a zero- or ultra-low carbon future, as costs fall with increasing volume, by application:

  • HGV transport for fleet vehicles
  • Blending of hydrogen into existing gas infrastructure
  • Methane grid conversion to pure hydrogen
  • Industrial use in refineries and ammonia production
  • Curtailment management
  • Provision of long-term or high volumes storage

Business Models for Integrating Hydrogen

  • A review of existing structures by which companies are integrating hydrogen into their businesses
  • Description of models that may be adapted by utilities, gas supply and infrastructure companies, integrated energy companies, and new entrants to the fuel supply business

Key questions will include:

  • For “green hydrogen” in the electricity sector – Whether to accept curtailment or pursue a curtailment-based strategy or dedicated facility approach for hydrogen
  • For infrastructure owner-operators – Whether to pursue a geographically pure hydrogen strategy or a strategy of carbon reduction by blending, or to combine both
  • What scale of production to aim for, over what time frame, with different answers likely for “blue hydrogen” and “green hydrogen”
  • Some companies may have an interest in development of very large-scale operations – This could this have a significant effect on the competitive environment
  • Some companies may be constrained, for commercial or regulatory reasons, to a specific sector focus, others may prefer a broader approach, incorporating for example mobility, industrial uses, and supply/distribution to heating markets

Decarbonizing the Gas Grid

Gas grid owners and operators are looking at ways to decarbonize gas and ensure the future of their assets
  • Gas is a low carbon fossil fuel, but not low enough for 80-95% decarbonization by 2050 
  • Grid operators are turning to green gas as a possible replacement for natural gas beyond 2030 — so far biogas has been only used for small-scale Combined Heat and Power (CHP)
  • Biogas and biomethane are constrained by feedstock availability
  • Power to hydrogen, or power to gas, may become a much more important source of green gas
  • Clean gas from steam reforming of natural gas plus carbon capture and storage could work synergistically with green gas
  • A choice may be needed between blending gases in the grid or converting parts of grid to hydrogen

Methodology: Quantitative Analysis

We assess potential scale and volume of hydrogen for 2030, 2040 and 2050. The hydrogen outlook will be consistent with IHS Markit energy scenarios:

  • For the power sector, we ensure consistency with existing outlooks for renewable deployment, interconnection and alternative forms of storage. Sensitivity cases based on approach to net-zero carbon emissions will be developed.
  • For the residential/commercial, industrial and transport sectors, an assessment of the scope of hydrogen is presented along with a discussion of infrastructure needs

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