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1. Higher Renewable Energy Targets in Germany: How Will the Industry Benefit?

Author:
Gilles Lepesant
Publication Date:
01-2023
Content Type:
Policy Brief
Institution:
Institut français des relations internationales (IFRI)
Abstract:
“Deutschland – Einstieg in die Deindustrialisierung?” – “Germany, the beginning of deindustrialisation?” asked the German economic newspaper Handelsblatt in the context of the spike in energy prices that has put at risk thousands of companies across Germany in 2022. Whereas some sectors such as steel, glass and chemicals have been seriously hit, the manufacturing industries operating in the areas linked to the energy transition (such as renewable energies and hydrogen production) should benefit from decisions taken to reach climate neutrality. Will the German industry benefit from the ambitious commitments agreed by the new coalition? The boom and bust of the solar sector in 2011 are a reminder that a strong internal demand does not necessarily translate into strong and resilient supply chains on the national territory. In the context of generous support schemes, several companies emerged in the 2000s benefiting from the strong demand for solar panels before being overwhelmed by Asian competitors. Nowadays, more than 90% of solar panels are imported from China. The level of ambition of the Federal government for the Energiewende has dramatically increased with the new coalition elected in 2021, the share of renewables to be reached in the power mix by 2030 being set at 80% (against 47% in 2022). The German wind industry has however been affected by a slowdown of the expansion of capacities, several rounds of onshore wind and solar auctions being in 2022 undersubscribed. The added value of the Energiewende in terms of job creation has been ambivalent so far. The country’s current industrial geography might be partly reshaped with the efforts made by northern and eastern States to deploy renewables and green hydrogen at large scale. Stakes are high for southern Germany since new spatial patterns are emerging in the automotive sector too. While Chinese competition in the solar and wind manufacturing sectors is tough, the Inflation Reduction Act has reinvigorated discussions around a stronger industrial policy.
Topic:
European Union, Electricity, Renewable Energy, Wind Power, Hydrogen, and Energy
Political Geography:
Europe and Germany

2. Green Hydrogen: Implications for International Cooperation With Special Reference to South Africa

Author:
Andreas Stamm, Tilman Altenburg, Rita Strohmaier, Ece Oyan, and Katharina Thoms
Publication Date:
01-2023
Content Type:
Working Paper
Institution:
German Institute of Development and Sustainability (IDOS)
Abstract:
Green hydrogen – produced with renewable energy – is indispensable for the decarbonisation of economies, especially concerning “hard-to-abate” activities such as the production of steel, cement and fertilisers as well as maritime transport and aviation. The demand for green hydrogen is therefore booming. Currently, green hydrogen is far more expensive than fossil fuel-based alternatives, but major initiatives are underway to develop a global green hydrogen market and bring costs down. Green hydrogen is expected to become cost-competitive in the mid-2030s. Given their endowment with solar and wind energy, many countries in the Global South are well-positioned to produce low-cost green hydrogen and are therefore attracting investments. Whether and to what extent these investments will create value and employment for – and improve environmental conditions in – the host economies depends on policies. This discussion paper analyses the potential industrial development spillovers of green hydrogen production, distinguishing seven clusters of upstream and downstream industries that might receive a stimulus from green hydrogen. Yet, it also underlines that there is no automatism. Unless accompanied by industrial and innovation policies, and unless there are explicit provisions for using revenues for a Just Transition, hydrogen investments may lead to the formation of socially exclusive enclaves. The paper consists of two parts. Part A provides basic information on the emerging green hydrogen market and its technological ramifications, the opportunities for countries with abundant resources for renewable energy, how national policies can maximise the effects in terms of sustainable national development and how this can be supported by international cooperation. Part B delves into the specific case of South Africa, which is one of the countries that has an advanced hydrogen roadmap and hosts several German and international development projects. The country case shows how a national hydrogen strategy can be tailored to specific country conditions and how international cooperation can support its design and implementation.
Topic:
Development, International Cooperation, Renewable Energy, and Hydrogen
Political Geography:
Africa, South Africa, and Germany

3. EU – Pacific Talks: H2 – Hydrogen Hype

Author:
David Plhák
Publication Date:
03-2022
Content Type:
Special Report
Institution:
Europeum Institute for European Policy
Abstract:
Czechia is in many respects similar to Japan in its limited ability to rely fully on renewables. It is therefore in the interest of Czechia to increase hydrogen imports and its use in the energy mix. In order to ensure a steady supply of hydrogen the gas system operators of Czechia, Slovakia, Ukraine, and Germany launched in 2021 joined initiative to create a Central European Hydrogen corridor in an effort to create a supply of hydrogen from Ukraine. Unfortunately, given the Russian aggression on Ukraine, this project must be stopped, until Ukraine will be free of war again.
Topic:
Climate Change, Energy Policy, European Union, Economy, and Hydrogen
Political Geography:
Japan, Ukraine, Germany, Asia-Pacific, Slovakia, European Union, and Czechia