SEFE plans to convert some pipelines and storage facilities from gas to hydrogen

German state-owned gas trader Securing Energy for Europe (SEFE) is considering options for converting some of its underground storage facilities and transmission pipelines. It wants to use them for clean hydrogen instead of natural gas, the company’s chief executive Egbert Läge told Reuters in an interview.

„We do not yet have an exact calculation of the investment,“ Läge said.

The cost of converting some of its gas storage facilities is expected to be around 500 million euros (CZK 12.7 billion), he said.

However, the investment required to convert some gas pipelines operated by its subsidiary Gascade to hydrogen would be much higher. Läge estimated that it could range from one to three billion euros.

A decision on converting some of the storage capacity is expected this year, Läge added. Plans to build a 1,200-kilometre hydrogen pipeline called Flow are further advanced, and investment could begin next year. Construction would then continue until 2028.

Germany is seeking to increase its reliance on hydrogen as a future energy source in order to reduce greenhouse gas emissions and dependence on fossil fuels in industries that cannot be electrified, such as steelmaking and chemicals.

SEFE was formerly known as Gazprom Germania and operates across all sectors of Germany’s energy market. It has a 14 percent share of the country’s gas supply market and also operates in the UK and seven other European countries. It also operates 5.6 billion cubic metres of gas storage capacity, a quarter of Germany’s total.

The German government nationalised the former subsidiary of Russia’s Gazprom in 2022 over concerns that the company could become insolvent, threatening the security of energy supplies in Germany. However, the state must exit the company by the end of 2028.