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.
- 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.
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.