The European Commission and national governments including Germany want to rapidly scale up production factories for “green” hydrogen
FRANKFURT: The European Energy Exchange (EEX) is exploring the development of hydrogen contracts to tap into the nascent economy for the zero-carbon fuel, a note from the bourse’s governing council said on Friday.
The European Commission and national governments including Germany want to rapidly scale up production factories for “green” hydrogen, derived from renewable power via electrolysis technology, in order to clean up polluting industries and hit climate targets.
EEX, a Deutsche Boerse subsidiary which is active in energy, carbon and freight markets at home and overseas, launched a working group that engages 120 energy operators last month.
“While the market itself does not yet exist, regulatory conditions and market design for hydrogen are now being established,” it said.
The discussions focused on a potential hydrogen market design “with the long-term goal to develop trading products, be it as a physical commodity or guarantee of origin,” it added.
EU countries use roughly 8 million tonnes a year of “grey” hydrogen, made from natural gas in a process that produces planet-warming emissions.
Green hydrogen could be especially helpful in hard-to-decarbonise sectors such as steel or refineries, as it can be stored in, and transported through, existing natural gas infrastructure.
Consultancy Horvath & Partners said in an interview in June that euro-denominated wholesale markets for hydrogen were very much on the horizon, especially with view to a possible import sector in the long-term future.
The region will lack land and offshore resources to produce sufficient green hydrogen, should a large-scale switch be made.
The 20-year-old EEX is Europe’s leading electricity and natural gas exchange. It has acquired rivals and offered clearing services across all time zones, notably stretching to the emerging Japanese power market this year.
Source: reuters
