Germany accelerates the hydrogen revolution: new law will facilitate infrastructure development

The German cabinet has approved a draft law intended to accelerate the development of hydrogen in Germany’s energy sector. The construction of hydrogen infrastructure would thus become a priority, gaining “overriding public interest” status, which in simple terms means that the approval process would be made easier by reducing bureaucracy. Numerous foreign media outlets have reported on the move.

Germany wants to reduce greenhouse gas emissions by ideally 36 to 41 million tonnes a year in order to achieve climate neutrality by 2045 (it currently reduces emissions by approximately 15 million tonnes a year). To achieve this, the country must significantly improve energy efficiency and substantially accelerate the development of renewable energy sources, while ensuring an adequate hydrogen supply. The latter has therefore become the main focus of the new draft law.

The draft law is primarily aimed at speeding up the availability of hydrogen, which means accelerating the construction of domestic infrastructure, as well as import and export facilities. As Europe’s largest economy and a leader in the energy transition, Germany has a strong interest in playing a key role in the hydrogen future too.

The law’s provisions include simplifying planning and permitting procedures, as well as public procurement. As noted above, projects covered by the law would immediately become “projects of overriding public interest”. Specific measures are expected to include requirements for digitalisation, shorter administrative deadlines and an easier process for converting existing gas pipelines and storage facilities to hydrogen. The ultimate goal is to create an efficient hydrogen economy.

The acceleration will primarily apply to the approval of electrolysers. However, their operators will have to connect their systems to renewable energy assets or declare their intention to purchase at least 80% renewable electricity by the end of 2029 in order to benefit from the law.

Germany’s hydrogen strategy

It is clear that Germany sees hydrogen as a future energy source. Recently, the country’s coalition government discussed a funding mechanism for the country’s hydrogen infrastructure. It plans to allocate around 3.5 billion euros in public funds to its construction between 2027 and 2036. Investors have also been offered protection in the event of bankruptcy, further confirming the scale and firmness of the country’s ambitions.

Germany is pursuing its own hydrogen strategy, which identifies hydrogen as a key element of the energy transition. For a complete picture, it is worth listing some of the strategy’s objectives.

Creating a domestic market is seen as a priority and the first step in getting the market off the ground. The goal that follows from the aforementioned draft law is to develop a specific regulatory framework for the development and expansion of the necessary infrastructure. Equally important is strengthening the competitiveness of German companies by supporting the use, research, development and export of hydrogen technologies.

Last but not least, Germany sees securing future supplies of renewable hydrogen through international partnerships as crucial. These partnerships should primarily be at European level, but should also include countries outside Europe with strong renewable energy potential.