Perspectives

Afkenel Schipstra

Senior VP Business Development Hydrogen Netherlands at ENGIE

1. What does it take to shape the development towards a hydrogen economy?

The key to the development of a value chain for green hydrogen are customers who want to buy green hydrogen. In addition, there are 5 important conditions that must be met in order for the value chain to become a reality.

1. Support from the national government and the EU in the form of adequate funding to cover the unprofitable top for investments. The faster we can scale up, the smaller the unprofitable top is going to be. It also includes having shared vision and national and international hydrogen strategies.

2. Technology developments: R&D in the field of electrolyzers; cost, efficiency, service life, usability. Here too, upscaling will help reduce the cost of electrolyzers.

3. The need for a comprehensive hydrogen infrastructure, including transport, storage and hydrogen fueling stations.

4. Stimulating laws and regulations that recognize and support the state of the hydrogen market and remove possible barriers. To name an example: the Renewable Energy Directive (REDII) legislation regulates the requirements for electricity used for electrolysis. The way in which these requirements are now taking shape is not expected to stimulate or help the launch of hydrogen in the market. More consideration should be given to the development phase the hydrogen market is in right now. What is needed now? An example of stimulating regulation would be to put an incentive in the market - there must be an incentive for market parties to start using green hydrogen. In the transport sector this can be done via the HBE system (currently being developed). This could make the use of hydrogen attractive in the mobility sector as it would compensate for the fact that the current price of green hydrogen is still high compared to other renewable fuels.

5. And although the share of renewable electricity is increasing, a major step forward still needs to be taken to achieve electrolysis ambitions. The construction of new offshore wind farms is no longer a given due to a 'wait-and-see what the demand does’ - attitude. A mechanism must therefore be put in place to ensure that the amount of renewable sources, in particular offshore wind, increases at the same time with electrolyzers are built.

2. What is already there, what is still missing and is there something to say about the pace?

In March 2020, the Dutch Minister of Economic Affairs and Climate presented a beautiful vision document in which it sees a major role for green and blue hydrogen. The ministry must now link supportive policies to this so that it becomes as attractive for companies to invest in the Netherlands as it is in Germany or France. As for the pace, political ambitions are high, almost every political party has included hydrogen in the election programs, but there is still a lack of supportive financial resources and regulation. The grant instruments mainly focus on pilots, innovations, etc. and not on large-scale deployment. This is necessary if the Netherlands wants to realize 500MW electrolysis capacity in 2025 and 3 to 4 GW in 2030. To realize the ambitions, you cannot wait until 2029, you have to take action now. I look at energy transition in different ways. Climate and environment are not my only motivations to be committed to ENGIE’s HyNetherlands project. The essence of the energy transition, I think, is the system change it brings about. The step towards a fossil-free world is fundamental, it has major social, economic and landscape consequences. That is precisely why I think we should actively share ideas, knowledge and developments with each other, in panels, conversations and on social media as Linkedin. With everyone. The step towards system change is about continuous innovation and the opportunities that come from it, and that exists by the grace of diversity. We need everyone in this comprehensive transition and development, women and men, young and old, established order and schoolchildren. I would like to commit myself to the ‘demystification’ of the energy transition. People who are confronted with the energy transition because they suddenly see large solar farms or a wind turbine on their doorstep only see the disadvantages. As industry and governments, we will have to tell the whole and honest story of the entire energy system change required. How it works now and how we would like to see it in the future. That we will need multiple techniques. If we fail to involve people more now and linger in discussions around one technique or another, we can surely expect to encounter difficulties in the future. People need to feel that they are part of working towards the energy transition themselves.
 

Afkenel Schipstra

3. What roles/activities does ENGIE see for itself in the construction of the hydrogen value chain and how do you work on this in the Netherlands and internationally?

For ENGIE, the development and rapid upscaling of the hydrogen chain is an essential part of the energy transition. With partners, we are therefore committed to the entire value chain from sustainable electricity generation, hydrogen production, transport and storage to stimulating the use of green hydrogen in industry to replace grey hydrogen and natural gas. ENGIE is therefore also actively involved in various projects in the Netherlands. Our own large-scale project HyNetherlands in the Eemshaven is of course our prime example. The geographic position of the Eemshaven in Groningen is very favorable. The connections of the Cobra cable to Denmark and the NorNed cable to Norway come ashore near the ENGIE power station. In addition, the recent news that the power from the new wind farm that will be located next to the current Gemini wind farm will also come ashore in the Eemshaven. We are good to go on the production side and with Chemical Park Delfzijl at fifteen kilometers, the purchase of green hydrogen will not be a problem. Gasunie still has to build a pipeline, but both Gasunie and Groningen Seaports are very positive in supporting this type of sustainable investment. Also a big plus is the presence of storage capacity in the salt caverns in Zuidwending. By the way, the gas pipelines themselves also offer a considerable buffer. This so-called ‘line pack flexibility’ already compensates a large part of the imbalance between production and use. In addition, we play a role in testing a hydrogen train and in the development of several other small-scale hydrogen chains in, among others, Den Helder. We are also actively involved in innovative technological developments around hydrogen, such as with Neste in the port of Rotterdam. ENGIE is part of the core group of the Hydrogen Coalition where we work together with many different social, public and private parties to accelerate the roll-out of hydrogen. That goes beyond just the industrial parties. It is the public and social parties such as municipalities, provinces and NGOs that are essential for the social safeguarding of a new system. It is not a question of ‘whether/or’ and ‘we vs them’, but rather a matter of working together to progress quickly.