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German gas storage operators slam H2 network plans

  • Market: Hydrogen
  • 01/08/23

Germany's gas system operators should "fundamentally rethink" their core assumptions for a future hydrogen transport network as existing plans would lead to an oversized grid, storage operator association Ines has said.

Germany's hydrogen transport system may need much less entry and exit capacity in the early 2030s than system operators' association FNB has assumed in initial plans, Ines said.

On the entry side, Ines regards the assumed import capacity as particularly oversized. Based on FNB's assumptions, capacity for hydrogen pipeline imports from neighbouring countries would be 58GW by 2032. FNB is factoring in 19GW of "other flows" into the grid, specifically imports from maritime terminals, for a combined 77GW, or 675 TWh/yr.

But in Germany's revised hydrogen strategy, which was finalised last week, the government estimates no more than 91 TWh/yr of imports would be needed by 2030 to meet demand, even in a maximum scenario. Even in longer-term scenarios, maximum import demand does not exceed 422 TWh/yr, Ines said.

It similarly questions assumptions around domestic electrolyser capacities and required exit capacity.

Given the "large discrepancies" between FNB's assumptions and other estimates, including in the national hydrogen strategy and in the government's long-term scenarios, the system operators should "fundamentally rethink" their approach, Ines said. Oversizing the grid risks infrastructure being underused, thereby driving up costs, the association said.

Effective use of storage sites would allow for the network to be kept smaller as these facilities can help meet demand peaks, Ines said.

"It is obvious that storages have not been factored in adequately for peak demand periods" in FNB's plans, it said.

Ines said last year that Germany may need to build new storage facilities for up to 41TW of hydrogen until 2050, in addition to converting existing sites that hold natural gas. While pilot projects for converting existing sites have been launched, uncertainties persist over the feasibility of using facilities for hydrogen, especially in aquifers.

FNB's consultation on its underlying assumptions for the hydrogen transport system ended last week. Based on its assumptions, the association had drawn up a core network comprising 11,200km of pipelines, but said the final network could be shorter when planning has been fully optimised. FNB expects around 60pc of the core network would consist of converted natural gas pipelines, and the remainder would be newly built connections.


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Q&A: IMO GHG scheme in EU ETS could be 'challenging'

Q&A: IMO GHG scheme in EU ETS could be 'challenging'

London, 11 April (Argus) — Delegates have approved the global greenhouse gas (GHG) pricing mechanism proposal at the International Maritime Organization's (IMO) 83rd Marine Environment Protection Committee (MEPC) meeting. Argus Media spoke to ministerial adviser and Finland's head representative at the IMO delegation talks, Anita Irmeli, on the sidelines of the London MEPC meeting. What is your initial reaction to the text? We are happy and satisfied about the content of the agreed text, so far. But we need to be careful. This week, all member states were able to vote. But in October, when adaption will take place, only those states which are parties to Marpol Annex VI will be able to vote if indeed a vote is called for, and that changes the situation a little bit. Here when we were voting, a minority was enough — 40 votes. But if or when we vote in October, then we need two thirds of those party to Marpol Annex VI to be in favour of the text. Will enthusiasm for the decision today remain by October? I'm pretty sure it will. But you never know what will happen between now and and the next six months. What is the effect of the decision on FuelEU Maritime and the EU ETS? Both FuelEU Maritime and the EU ETS have a review clause. This review clause states that if we are ambitious enough at the IMO, then the EU can review or amend the regulation. So of course, it is very important that we first consider if the approved Marpol amendments are ambitious enough to meet EU standards. Only after that evaluation, which won't be until well after October, can we consider these possible changes. Do you think the EU will be able to adopt these the text as it stands today? My personal view is that we can perhaps incorporate this text under FuelEU Maritime, but it may be more challenging for the EU ETS, where shipping is now included. What was the impact of US President Donald Trump's letter on the proceedings? EU states were not impacted, but it's difficult to say what the impact was on other states. By Madeleine Jenkins Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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IMO approves two-tier GHG pricing mechanism


11/04/25
News
11/04/25

IMO approves two-tier GHG pricing mechanism

London, 11 April (Argus) — Delegates have approved the global greenhouse gas (GHG) pricing mechanism proposal at the International Maritime Organization's (IMO) 83rd Marine Environment Protection Committee (MEPC) meeting, pending an adoption vote at the next MEPC in October. The proposal passed by a majority vote, with 63 nations in favor including EU states, the UK, China and India, and 16 members opposed, including Mideast Gulf states, Russia, and Venezuela. The US was absent from the MEPC 83 meeting, and 24 member states abstained. The proposal was accompanied by an amendment to implement the regulation, which was approved for circulation ahead of an anticipated adoption at the October MEPC. Approval was not unanimous, which is rare. If adoption is approved in October at a vote that will require a two-thirds majority, the maritime industry will become the first transport sector to implement internationally mandated targets to reduce GHG emissions. The text says ships must initially reduce their fuel intensity by a "base target" of 4pc in 2028 ( see table ) against 93.3 gCO2e/MJ, the latter representing the average GHG fuel intensity value of international shipping in 2008. This gradually tightens to 30pc by 2035. The text defines a "direct compliance target", that starts at 17pc for 2028 and grows to 43pc by 2035. The pricing mechanism establishes a levy for excessive emissions at $380 per tonne of CO2 equivalent (tCO2e) for ships compliant with the minimum 'base' target, called Tier 2. For ships in Tier 1 — those compliant with the base target but that still have emission levels higher than the direct compliance target — the price was set at $100/tCO2e. Over-compliant vessels will receive 'surplus units' equal to their positive compliance balance, expressed in tCO2e, valid for two years after emission. Ships then will be able to use the surplus units in the following reporting periods; transfer to other vessels as a credit; or voluntarily cancel as a mitigation contribution. IMO secretary general Arsenio Dominguez said while it would have been more preferable to have a unanimous outcome, this outcome is a good result nonetheless. "We work on consensus, not unanimity," he said. "We demonstrated that we will continue to work as an organization despite the concerns." Looking at the MEPC session in October, Dominguez said: "Different member states have different positions, and there is time for us to remain in the process and address those concerns, including those that were against and those that were expecting more." Dominguez said the regulation is set to come into force in 2027, with first revenues collected in 2028 of an estimated $11bn-13bn. Dominguez also said there is a clause within the regulation that ensures a review at least every five years. By Hussein Al-Khalisy, Natália Coelho, and Gabriel Tassi Lara IMO GHG reduction targets Year Base Target Direct Compliance Target 2028 4% 17% 2029 6% 19% 2030 8% 21% 2031 12% 25% 2032 17% 30% 2033 21% 34% 2034 26% 39% 2035 30% 43% Source: IMO Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Oil and gas lobby calls H2 'core competency,' hails 45v


10/04/25
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10/04/25

Oil and gas lobby calls H2 'core competency,' hails 45v

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US absence unlikely to derail IMO talks


10/04/25
News
10/04/25

US absence unlikely to derail IMO talks

London, 10 April (Argus) — The US delegation's absence from the 83rd International Maritime Organisation's (IMO) Marine Environment Protection Committee (MEPC) meeting is unlikely to derail the outcome of discussions on a greenhouse gas (GHG) economic pricing mechanism, market participants told Argus . This comes after the US sent a statement to foreign embassies of countries partaking in the IMO GHG economic pricing mechanism talks, confirming the US' absence from the negotiations. The statement says: "President Trump has made it clear that the US will not accept any international environmental agreement that unduly or unfairly burdens the US or the interests of the American people," according to a document seen by Argus . It adds: "Should such a blatantly unfair measure go forward, our government will consider reciprocal measures so as to offset any fees charged to US ships and compensate the American people for any other economic harm from any adopted GHG emissions measures". The statement ends: "The US will engage with partners on energy and investment issues of common interest. We stand ready to work with you to advance our shared commitment to energy security and economic growth". "The US will not be engaging in negotiations at the IMO's 83rd Marine Environment Protection Committee. Consistent with President Trump's executive orders on international environmental agreements and on energy dominance, it is the administration's policy to put the interests of the US and the American people first in the development and negotiation of any international agreements", the US State Department told Argus . IMO member countries are voting this week on the economic pricing mechanism for marine GHG emissions, for which the structure is expected to be agreed by 11 April, according to IMO secretary-general Arsenio Dominguez. Even if the US does not engage in the GHG talks, it cannot unilaterally block decisions at the IMO, a spokesperson told Argus . Many of the GHG measures remain under discussion, with final approvals from the working group expected by 11 April. "The US doesn't have a huge share of the global ocean-going fleet, so their absence or opposition probably won't change the broader [IMO members] consensus", a Chile-based ship owner told Argus . US imposing "reciprocal" costs on foreign ships calling at US ports will almost certainly get passed on to [US] consumers, which could lead to higher prices for goods in the US, the owner said. If the measures are ratified by IMO member nations, US-flagged ships will probably not adhere to IMO's regulations when they call into ports of member countries, a Singapore-based shipbroker said. "We are not expecting any impacting on Asia-Pacific region yet, and it's subject to what is agreed at the MEPC and how levies are calculated," the shipbroker added. Despite not having veto power, the US remains the largest financial contributor to the UN, a Greece-based shipowner told Argus . If international shipbuilding credit lines begin to tighten under US influence, other countries may align with Washington's stance, it added. The IMO has 176 member countries. Greece, China and Japan account for the largest shares of the global ocean-going fleet. During the ongoing session, member states have approved interim guidance on the carriage of biofuel blends. The guidance allows conventional bunker ships certified for carriage of oil fuels under Marpol Annex I to transport blends of not more than 30pc by volume of biofuel , as long as all residues or tank washings are discharged ashore, unless the oil discharge monitoring equipment is approved for the biofuel blends being shipped. By Hussein Al-Khalisy, Madeleine Jenkins, Stefka Wechsler, Mahua Mitra, Natália Coelho, and Gabriel Tassi Lara Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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Defence spending hike gives H2 an opportunity


08/04/25
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08/04/25

Defence spending hike gives H2 an opportunity

Hydrogen could play a role in EU defence considerations, as governments are placing an emphasis on resilience, writes Stefan Krumpelmann Hamburg, 8 April (Argus) — Vows by European leaders to boost defence spending have left climate policy advocates worried that efforts to reduce emissions could fall by the wayside. But the renewed focus on security and resilience could also present fresh opportunities for the struggling clean hydrogen sector. Funding otherwise earmarked for "green" initiatives could now be redirected to the defence sector and the first shifts have already taken place, for instance in Poland . For clean hydrogen, any cuts to public funding could be particularly detrimental, given its continued reliance on large subsidies. But funding for green technologies could follow behind the increased defence spending. In return for waving through a €500bn ($548bn) package for defence and infrastructure, Germany's Green party was instrumental in getting conservative CDU/CSU and social-democratic SPD to include €100bn for climate protection. Some of this is likely to go to the hydrogen sector, government officials have said. In any case, hydrogen and defence industry participants alike point to synergies between their sectors, noting that an increased focus on security could speed up technological progress on hydrogen and bring down costs in the process. Renewable hydrogen production, storage and fuel cell systems could play a key role in bolstering energy independence — and therefore resilience — of military camps, radar stations and other critical infrastructure such as hospitals, according to Christian Trapp, chairman of the board at the German armed forces university's research centre for mobility and renewable energy. In the past, development of such systems was primarily driven by sustainability considerations, Trapp told the Hydrogen and Fuel Cells Public Forum at the Hanover Trade Fair on 3 April. But now "the ministry of defence is asking for resilience and this is a key gamechanger" as it "justifies" higher investments. Defence companies have investigated potential applications for hydrogen and derivatives for some time. Germany's Rheinmetall told Argus in 2023 that synthetic fuels made domestically could help reduce reliance on fuel supply from abroad while allowing for decentralised production that would be "unattackable". Use of hydrogen and derivatives could also offer other benefits. Its proponents point to lower noise and heat profiles of military vehicles running on fuel cells instead of combustion engines, which would make them harder to detect. German fuel cell firm SFC Energy sees that its investments in defence applications are now starting to pay off , the firm's chief executive, Peter Podesser, has said. SFC has developed portable hydrogen and methanol fuel cells for more than 20 years as a more lightweight alternative to batteries that produces less noise and heat. But until recently, it "almost had to hide" military applications "from an ESG [environmental, social and governance] perspective", Podesser said. Larger defence budgets could aid hydrogen in more indirect ways as well. Lead markets have been the talk of the town lately when it comes to reinvigorating Europe's hydrogen efforts . The concept remains vague in many respects, but the more concrete proposals include "green" criteria — or even quotas — for public procurement. This could cover, for instance, green steel procurement by the armed forces. At the Hanover event, the German economy and climate protection ministry's head of industrial policy, Beate Baron, signalled openness to the idea, but said more work is needed on certification of low-emission products. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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