North Africa has no interest in exporting green hydrogen to Europe (Transnational Institute)

(Ecofin Agency) – While Morocco, Algeria and Egypt have established partnerships with several European countries to produce hydrogen and export it to the old continent, a study conducted by two western research centers shows the inconsistencies and the dangers of this option for the countries the southern shore of the Mediterranean Sea.

Eldorado or Fata Morgana? Due to their geographical proximity to Europe and their large resources of low-cost renewable energy, the countries of North Africa are positioning themselves as ideal partners of the European Union (EU) in the field of production and hydrogen and dream of making large sums thanks to the export of this carbon-free energy to the north coast of the Mediterranean Sea. But it’s a long way from the cut to the lips. In a study published on Sunday May 15, the Dutch think tank Transnational Institute and the Corporate Europe Observatory (CEO), a Brussels-based research center that monitors how big business lobbies influence European public policies, have dampened these countries’ hopes .

title “Assessment of EU plans to import hydrogen from North Africa” (Evaluating EU plans to import hydrogen from North Africa), this study found that the green hydrogen export programs developed by three North African countries are not economical.

“Hydrogen export projects from Morocco, Algeria and Egypt — the three North African nations planning to build local green hydrogen industries — may not be economically viable,” emphasizes the study. And to add: “Taking local renewable electricity (solar and wind) and sharing it with neighboring countries in Africa and possibly the Middle East via interconnectors would be a much more efficient option than trying to create an export market for very expensive chemical products.”

11 times more expensive than natural gas!

The authors of the study also express doubts “Possibility to one day export green hydrogen at sufficiently attractive prices”, given the high production and transport costs. “Green hydrogen could cost up to 11 times more than natural gas per unit of energy at pre-Ukrainian invasion prices, even before storage and transport… and three times more expensive than prices [du gaz] today’s highest per energy unit”, They fight.

The Transnational Institute and the Observatory of Industrial Europe, on the other hand, note that North Africa’s rush for green hydrogen does not obey the logic of profitability.

“It makes little sense for Morocco, Algeria or Egypt to use their renewable electricity to produce hydrogen and hydrogen-based products and then ship them to Europe with a lot of wasted energy so that the ‘EU can achieve a reduction in climate emissions’, They are surprised and recall that these countries meet most of their electricity needs from fossil fuels. Morocco gets most of its electricity from coal, while Algeria’s electricity comes almost 100% from natural gas and over 90% of Egypt’s electricity comes from oil and some gas.

Several green hydrogen mega-projects have been unveiled in North Africa in recent months. French company Total Eren has announced construction of a $10.7 billion plant on a massive 170,000-hectare site in Morocco, while Norwegian group Scatec has signed a deal to build a green hydrogen plant in Egypt for an investment of $5 billion.

For its part, Germany has provided 2 billion euros in public funds for partnerships in the green hydrogen sector in Morocco, Namibia, the Democratic Republic of the Congo (DRC) and South Africa.

German giant Siemens also signed a MoU with Egypt in 2021 to develop large-scale green hydrogen projects in the country with a total investment estimated at $23 billion.

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