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List of top priority hydrogen infrastructure considered in Europe’s “common interest” includes projects worth at least €50bn

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Climate

Food & Water Action Europe analyzed the Union List of Projects of Common and Mutual Interest (PCI and PMI list), the EU Commission published on 28 November. Our focus is on the hydrogen transmission infrastructure – a total of 68 investment items for hydrogen pipelines, storage facilities and ammonia reception facilities.

Compared to these projects, the number of 17 electrolysers included in the Union List is considerably low.

Our findings:

  • All of the 68 hydrogen transmission projects included in the Union list have been proposed by the fossil fuel industry. That means 100% of the projects proposed for priority status and eligibility for EU tax money would be built and operated by the fossil gas transport industry and fossil fuel majors such as RWE, Shell and BP. Three quarters of the projects included on the Union list have been brought forward by members of the European Network of Gas Transmission System Operators (ENTSO-G), the very same network which has a central role in the process of assessing and selecting Union list priority projects.
  • Only the costs of two thirds of the 68 projects are being disclosed. The projects that do provide CAPEX (capital expenses) figures have a combined cost of over €50bn. On top of that, operating costs for these projects amount to over €1bn annually. That means that using the proposed hydrogen infrastructure for just 20 years would add another €22bn in operating costs. If these projects go ahead, consumers will have to pick up much of the bill; on top of that, some of the projects will receive EU tax money from the Connecting Europe Facility and other pots.

    The capital expenses and operational expenses for over one third  of the projects on the list are not disclosed. Assuming that those costs are on average the same as the other 44 projects , building and operating all 68 projects for 20 years could cost more than €100bn€.

    There is large uncertainty around the costs of hydrogen projects, which could result in even higher total costs.  Most project promoters provide an estimate of the cost variations. The average range of these capital expenses amounts to over 30%. This means that the hydrogen infrastructure project costs might increase considerably, and that consumers and taxpayers might be forced to pick up a bill far higher than €100bn for the hydrogen projects included on the Union list.

  • These Union list hydrogen transmission projects have been selected without any official priority-use assessment. The requirement to limit the scarce amounts of all hydrogen available to those sectors where no alternatives exist is being ignored. This risks channeling billions of euros into projects owned by the fossil fuel sector and building an inefficient system that is not aligned with efficiency and priority-only-use infrastructure needs.
  • The promise of climate-friendly hydrogen seems to have turned into a multi-billion jackpot for the fossil gas industry. But only a small fraction of the projects proposed for top priority label are credibly green hydrogen projects, i.e. are linked to concretely defined sources of green hydrogen/electrolyzers, explicitly planning the use of renewable hydrogen only in the PCI/PMI submission. More than half of the projects that had been submitted to the Union list process explicitly included a mention of aiming to transport fossil based hydrogen.

The inclusion of this many huge, costly hydrogen projects on a list for EU top priority infrastructure is worrying, particularly given the profound involvement of the fossil fuel industry in the process and the lack of appropriate assessment of the projects. The climate crisis requires a swift, decisive  move towards truly clean energy; people and our planet cannot afford a multi-billion, multi-year detour via an unneeded super-sized hydrogen economy.

***

Methodology:

While the Union List does not include projects’ numbers and often summarizes several projects/investment items into clusters, all projects applying for PCI status have a unique project number and have been submitted with a set of further details. Hydrogen projects on the Union List are represented in the Ten Year Network Development Plan (TYDNP) drafted by ENTSO–G, which also provides projects’ costs. To analyze the projects included on the Union List relating to costs (CAPEX and OPEX), cost range and project promoters, and providing the projects’ concrete project numbers, FWAE identified for each of the projects on the list its equivalent in a) the TYNDP and b) the list of submissions for inclusion in the Union list. The latter had been made available during the public consultation for the 1st Union List including hydrogen infrastructure (the project list itself is no longer online).

Here is the list of concrete investment items included on the Union List identified through Food & Water Action Europe’s analysis. 

Some projects have been included on the Union List only partially (HYD-N-1205, HYD-N-443, HYD-N-1171, HYD-N-1172, HYD-N-1036, HYD-N-1350, HYD-N-468, HYD-N-788, HYD-N-1239), four projects (only one of which disclosed costs) have a different name on the Union List and thus the assignment with an investment item number is not fully clear (HYD-N-1149, HYD-N-767, HYD-N-772, HYD-N-986).

Some projects have been submitted by different promoters by splitting both CAPEX and OPEX, and each investment item therefore only representing a part of the total project cluster cost. Others have submitted the total project cluster cost for each investment item, requiring the avoidance of double counting for PCI/PMI list project costs. 

The Next Union List for Hydrogen Projects – The Fossil Fuel Industry Wish List Coming true?

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LNGFossil Fuels

Leaked list of top priority hydrogen infrastructure considered in Europe’s “common interest” includes projects worth at least €50bn. 

Food & Water Action Europe analyzed a leak of the Union List of Projects of Common and Mutual Interest (PCI and PMI list), which is expected to be published in November. Our focus is on the hydrogen transmission infrastructure – a total of 68 investment items for hydrogen pipelines, storage facilities and ammonia reception facilities. 

Compared to these projects, the number of 17 electrolysers included in the Union List is considerably low.

Our findings:
  • All of the 68 hydrogen transmission projects included in the leaked Union list have been proposed by the fossil fuel industry. That means 100% of the projects proposed for priority status and eligibility for EU tax money would be built and operated by the fossil gas transport industry and fossil fuel majors such as RWE, Shell and BP. Three quarters of the projects included on the Union list have been brought forward by members of the European Network of Gas Transmission System Operators (ENTSO-G), the very same network which has a central role in the process of assessing and selecting Union list priority projects.
  • Only the costs of two thirds of the 68 projects are being disclosed. The 44 projects that do provide CAPEX (capital expenses) figures have a combined cost of over €50bn. On top of that, operating costs for these projects amount to over €1bn annually. That means that using the proposed hydrogen infrastructure for just 20 years would add another €22bn in operating costs. If these projects go ahead, consumers will have to pick up much of the bill;  on top of that, some of the projects will receive EU tax money from the Connecting Europe Facility and other pots.

    The capital expenses and operational expenses for over one third  of the projects on the list are not disclosed. Assuming that those costs are on average the same as the other 44 projects , building and operating all 68 projects for 20 years could cost more than €100bn€.

    There is large uncertainty around the costs of hydrogen projects, which could result in even higher total costs.  Most project promoters provide an estimate of the cost variations. The average range of these capital expenses amounts to over 30%. This means that the hydrogen infrastructure project costs might increase considerably, and that consumers and taxpayers might be forced to pick up a bill far higher than €100bn for the hydrogen projects included on the Union list.
  • These Union list hydrogen transmission projects have been selected without any official priority-use assessment. The requirement to limit the scarce amounts of all hydrogen available to those sectors where no alternatives exist is being ignored. This risks channeling billions of euros into projects owned by the fossil fuel sector and building an inefficient system that is not aligned with efficiency and priority-only-use infrastructure needs.
  • The promise of climate-friendly hydrogen seems to have turned into a multi-billion jackpot for the fossil gas industry. But only a small fraction of the projects proposed for top priority label are credibly green hydrogen projects, i.e. are linked to concretely defined sources of green hydrogen/electrolyzers, explicitly planning the use of renewable hydrogen only in the PCI/PMI submission. More than half of the projects that had been submitted to the Union list process explicitly included a mention of aiming to transport fossil based hydrogen.

The inclusion of this many huge, costly hydrogen projects on a list for EU top priority infrastructure is worrying, particularly given the profound involvement of the fossil fuel industry in the process and the lack of appropriate assessment of the projects. The climate crisis requires a swift, decisive  move towards truly clean energy; people and our planet cannot afford a multi-billion, multi-year detour via an unneeded super-sized hydrogen economy.

***

Methodology:

While the Union List does not include projects’ numbers and often summarizes several projects/investment items into clusters, all projects applying for PCI status have a unique project number and have been submitted with a set of further details. Hydrogen projects on the Union List are represented in the Ten Year Network Development Plan (TYDNP) drafted by ENTSO–G, which also provides projects’ costs. To analyze the projects included on the leaked Union List relating to costs (CAPEX and OPEX), cost range and project promoters, and providing the projects’ concrete project numbers, FWAE identified for each of the projects on the leaked list its equivalent in a) the TYNDP and b) the list of submissions for inclusion in the Union list. The latter had been made available during the public consultation for the 1st Union List including hydrogen infrastructure (the project list itself is no longer online).

Here is the list of concrete investment items included on the Union List leak identified through Food & Water Action Europe’s analysis. 

Some projects have been included on the Union List only partially (HYD-N-1205, HYD-N-443, HYD-N-1171, HYD-N-1172, HYD-N-1036, HYD-N-1350, HYD-N-468, HYD-N-788, HYD-N-1239), four projects (only one of which disclosed costs) have a different name on the Union List and thus the assignment with an investment item number is not fully clear (HYD-N-1149, HYD-N-767, HYD-N-772, HYD-N-986).

Some projects have been submitted by different promoters by splitting both CAPEX and OPEX, and each investment item therefore only representing a part of the total project cluster cost. Others have submitted the total project cluster cost for each investment item, requiring the avoidance of double counting for PCI/PMI list project costs. 

***

UPDATE: The EU Commission has published the final draft of the Union list on 28 November 2023. It does not differ from the Union list leak analysed above in terms of hydrogen projects.

A Devastating Dam in DR Congo – To Quench Europe’s Thirst for ‘Green’ Hydrogen

Categories

Food

The EU has grand plans for hydrogen, but the impacts on many communities and on the climate will not be so grand at all

By 2030, the EU plans to generate 10 million tons of hydrogen, and import an additional  10 million tons  from other countries. While there is a lot of talk about ‘green’ hydrogen, i.e. hydrogen made by using large amounts of renewable energy, there will also be a substantial amount of fossil fuels-based hydrogen, also called ‘gray’, ‘black’ or ‘blue’ hydrogen. 

While often hailed as clean and as a promising climate solution, ‘green’ hydrogen comes with several drawbacks, and can directly threaten the livelihoods of people in the global south.

In September, a delegation of experts and impacted community members from different African countries visited Brussels, sharing their knowledge and worries about the impacts of Europe’s hydrogen plans, particularly on the Democratic Republic of Congo (DRC).

While there are plans to export ‘green’ hydrogen from several different African countries, the example of the DRC is definitely a cautionary tale on many levels. ‘Green’ hydrogen would be generated with hydropower from a gigantic dam (called the Inga dam) which, once constructed, would be the biggest dam on our planet. The government of the DRC regards the Inga Project as a substantial hydroelectric initiative that has attracted the involvement of Chinese and Spanish companies.

The displacement of local communities is a common consequence of large-scale infrastructure projects. Affected communities often receive insufficient compensation and have limited say in a decision-making process that disrupts their lives and livelihoods.
Part I and II of this dam were already built years ago, flooding land, displacing people and forcing those who stayed in the area to walk for hours to get access to clean water. Angelique Mvuezolo brought the perspective of communities threatened by Inga dam part III directly to Brussels, highlighting how the first two parts of the dam were already forced on people with false promises. She finds the government promise that there will not be any people displaced hard to believe; The third dam would flood the entire Bundi valley and might even affect land beyond DRC’s borders. 

And Eric Kassongo from CODED, the Centre Congolais pour le Droit du Développement Durable, decried a severe lack of transparency around the project. Kassongo was able to explain what is known about the links between the Inga dam project and Europe. An agreement to develop Inga dam III was signed in 2018 with by a consortium led by the Chinese Three Gorges and Spanish Actividades de Construccion y Servicios (ACS), the latter having links to the European Investment Bank (EIB) that had already been involved in the development of Inga dam part I. Also Deutsche Bank and funds in other European countries have ties to Inga dam III.

The potential construction of large hydroelectric dams in the DRC raises alarms about the environmental consequences as well. These projects can disrupt ecosystems and lead to a release of climate-wrecking methane emissions. The Congo River, which would be dammed up, serves as an important carbon sink as it carries minerals into the ocean, which puts the climate benefit of the gigantic projects into question. Droughts and floods, made stronger and more likely by climate change, are not only devastating in its impact on communities, but also increase the uncertainties around the entire project  – a point highlighted by Siziwe Mota from International Rivers.

Only a very small fraction of the people in the Democratic Republic of Congo have access to energy. Still, considerable shares of this new mega-hydropower project are dedicated to splitting water into oxygen and hydrogen. The hydrogen would then be exported to Europe, but in which form and via which export and import facilities is still unclear. The neocolonial nature of such undertaking is impossible to negate, and Europe risks continuing a highly unjust model of exploitation by failing to block support for Inga dam and other similar projects in the global south.

It is crucial for European decision makers to look beyond the label of ‘green’ hydrogen, and to establish a much safer definition on what truly green energy actually is. They also fail to consider energy poverty, or lack of access to energy, in the countries the EU plans to source its hydrogen. It seems certain that the EU is dramatically inflating its projections for green hydrogen production. These projections should be drastically downscaled, for the sake of the people and the future of our only planet.

Joint NGO Letter: DG CLIMA to support ambitious EU methane regulation

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MethaneFossil Fuels

Over 10 CSO groups from across Europe have sent an open letter to the EU Commission. We are writing to DG CLIMA to urgently request stronger support and involvement in the ongoing trilogue negotiations on the Methane Regulation to cut methane emissions in the energy sector.

We are extremely concerned about the Council’s lack of ambition on the text, and the impact it will have on the final agreement.

We therefore call DG CLIM to support the colleagues from DG ENER in making the Methane Regulation a crucial tool to reduce GHG emissions and bring the EU closer to reaching its 2030 and 2050 climate targets.

You can read the joint letter here.

Netherlands – Fracked Gas Imports: Briefing

Imports of U.S. liquid gas into the Netherlands soared in 2022, representing 59% of total LNG imports and 34% of total gas consumption in the country – and almost all of it comes from fracking. In order to avoid climate catastrophe, Europe and the Netherlands should decrease their dependence on U.S. fracked gas as fast as possible.

Fossil gas, no matter its origin, is no solution for Europe. Russian gas has proven to be synonymous for supply insecurity and weaponization of the EU’s dirty energy dependency. The EU’s aim to get off Russian gas could be a big chance to accelerate a just transition. So far, however, EU-leaders and European governments have chosen to go into the wrong direction embracing LNG as a dirty fix, while largely ignoring real solutions. Simply moving Europe’s gas addiction from Russia to LNG imports is a big problem. This briefing takes a closer look at fossil gas imports from the U.S., which are almost entirely fracked.

Read the full briefing here

The European Parliament’s Plenary Adopts a Good Position on the EU Methane Regulation, But Concerns Persist. 

Categories

MethaneFossil Fuels

On Tuesday, May 9, the European Parliament’s plenary adopted its position on the EU methane regulation proposal. 

This is a good result, considering the plenary’s vote had been overshadowed by the threat of the adoption of some worrying amendments from some MEPs in the EPP and ID (European People’s Party and Identity and Democracy) groups. These would have dramatically weakened key elements of the report as adopted in the European Parliament’s ITRE (Energy) and ENVI (Environment) committees at the end of April, by favouring the interests of the fossil fuel industry through weakening provisions on leak detection and repair (LDAR) and energy imports. 

Fortunately, this did not happen. In its position, the European Parliament calls on the European Commission to set binding targets to reduce methane emissions for 2030 and implements strict rules on imported fossil gas, coal and oil from 2026 onwards. Additionally, the parliament’s position extends the provisions of the regulation to the petrochemical sector, which is becoming the largest driver of global oil demand. 

Let’s not sweep problems under the rug

Although this is a very good outcome, some concerns spoil the party:

  • No mention of fossil fuel phase-out

In the Parliament’s text there is no mention of a phase-out of fossil fuels in the longer term. Contrary to what signatories asked for in our methane manifesto, rapid actions to cut methane emissions from fossil fuels are crucial in the short-term, but these need to be coupled with strong commitments towards a path to deliver a fossil-free European Union. In 2021, the European Parliament in its INI report on the EU Methane Strategy, clearly recognised that fossil fuels have no long-term role in the Union’s energy mix. But this is not reflected in the final parliamentary position adopted this week. 

  • No fracked gas import ban

The EU Parliament’s request for stricter measures on imports is an important step forward compared to the Commission and Council’s positions, but a clear focus on the need to stop imports of fracked gas is missing. Most of the U.S. Liquified Natural Gas (LNG) exported to Europe is produced by fracking, a technology which is banned across much of the EU due to its environmental impacts. Fracking is closely tied to the rise of methane emissions in the atmosphere, besides posing a serious threat to public health and local communities. However, U.S. fracked gas imports to Europe skyrocketed after Russia’s invasion of Ukraine and the European Parliament had the opportunity in its report to call for an immediate ban on those imports.  

  • Major loopholes for coal mine methane emissions

Following strong pressure from the Polish coal industry, the European Parliament revised downwards its ambition on coal mine methane emissions. However, coal mines are the largest single source of energy sector methane emissions in the EU.

Amendments adopted in plenary suggest an increase in venting thresholds for thermal coal, while action on venting from coking coal is delayed until 2031. The rules will allow Polish mining companies to easily comply with the regulation through accounting tricks rather than any actual methane reductions. 

  • There’s always danger lurking in the dark

The imminent start of trilogue negotiations in the summer with the Council and the European Commission are one more opportunity for the fossil fuel industry to scuttle these regulations. The Council’s general approach has more holes than Swiss cheese and blatantly benefits the interests of fossil companies. It will be vital to safeguard and strengthen the parliament’s position, and to ensure that the trilogue final text is not a lowball agreement, but one that truly serves the interests of the planet and the people.