Hydrogen Atlas of the Future: Germany and Its Partner Countries

In the project "HYPAT – H2 POTENTIAL ATLAS," nine research institutions, led by Fraunhofer ISI, examined the future role of green hydrogen in transforming industry, the transport sector, and the energy economy toward greater sustainability and climate neutrality. The project identified potential partner countries for Germany to ensure a secure and sustainable supply, assessed global supply and demand potentials for hydrogen and its derivatives, and provided recommendations for import, funding, and cooperation strategies. The final report has now been published.

Green hydrogen is a crucial energy carrier for the energy transition in Germany and Europe, as well as globally. Germany, in particular, will need to import a significant portion of green hydrogen and its derivatives, as domestic renewable energy sources are limited, but demand for hydrogen and its derivatives will be high.

In this context, the recently completed HYPAT project aimed to identify sustainable locations for tomorrow’s green hydrogen economy. It conducted technical, economic, regulatory, and social analyses to develop a global hydrogen atlas. Using integrated energy system models, the atlas provides detailed insights into the production of green hydrogen and the necessary infrastructure, including international transport options and demand scenarios. The analyses also considered the needs of partner countries, identified opportunities for these nations, and included acceptance and stakeholder analyses.

Key Findings

One major finding is that global demand for green hydrogen and its derivatives will increase significantly, especially under ambitious greenhouse gas reduction targets. The global hydrogen demand in 2050 is projected to range between 4% and 11% of global final energy demand. For Germany, this figure is approximately 20%, driven by its industrial structure and the high relevance of the steel and chemical sectors as potential users.

Greater Investment Needed

The project’s analyses also show that the global supply potential for green hydrogen is sufficient to meet demand, even when considering constraints such as water scarcity. This offers Germany opportunities to diversify its imports and mitigate risks. However, economically, it would be more advantageous to concentrate on a few supplier countries to achieve economies of scale and avoid high production and infrastructure costs. Currently, the market ramp-up is progressing slowly. Geopolitical tensions, supply disruptions, uncertain demand, and high energy and raw material prices are deterring necessary investments.

In terms of hydrogen import costs to Europe, the project estimates costs of €3.50–6.50 per kg in 2030 and €2.50–4.50 per kg in 2050. Wholesale prices in Germany are expected to remain comparatively high at over €4 per kg in 2050. Germany is likely to face the highest hydrogen prices within the EU and globally.

Challenges to Competitiveness

These high costs will impact the competitiveness of German industry, particularly in industrial applications that will rely on green hydrogen to reduce greenhouse gas emissions. Countries like the USA or Canada, which have abundant, cost-effective resources for green hydrogen production, have a competitive advantage in industrial applications.

In the short- and medium-term, the limited supply of hydrogen necessitates prioritizing sectors with few alternatives, such as steel production, basic chemicals, international aviation and shipping, and refineries. For hydrogen and its derivatives to be used in areas like building heating or road transport, prices would need to drop significantly, which is unlikely in the near future.

Supply Considerations and Strategic Recommendations

The HYPAT project concludes that the EU can largely meet its own hydrogen needs economically but will rely on imports for derivatives due to quantity and cost considerations. Germany should actively support export countries and the development of international transport capacities. Within the EU, high investments are currently being made in countries with significant hydrogen demand but less so in countries with favorable production conditions, such as France. Future EU-wide priorities should address this imbalance.

Germany as a Key Importer

Since global import needs are expected to remain moderate, global trade will account for only about one-third of total hydrogen demand between 2030 and 2050. Germany, along with the Netherlands, Belgium, and Italy within the EU, as well as Japan and South Korea globally, will have the highest import needs.

Countries like Spain, France, Denmark, the UK, and Poland could supply EU countries that cannot meet their own needs. A well-developed European hydrogen pipeline infrastructure is therefore in Germany's interest. Additionally, Germany should cooperate with importing nations both within and outside the EU to build purchasing power.

Potential export countries include Morocco, the United Arab Emirates, Canada, Brazil, and Chile, which have favorable renewable energy conditions and access to cost-effective capital. Other factors such as geopolitical interests, human rights, and democratic principles should also be considered. Water availability, national regulations, and domestic energy use are critical to ensuring hydrogen projects for export do not displace local energy transition activities or increase local emissions. These projects should benefit local communities, as hydrogen projects often entail significant conflict potential.

Conclusion and Outlook for Germany

Professor Dr. Martin Wietschel, who heads the Competence Center Energy Technologies and Energy Systems at Fraunhofer ISI and coordinated the HYPAT project, summarized the project’s findings:

“In the HYPAT project, it became clear that Germany, as a major future consumer, must ensure a stable and sustainable supply of the promising energy carrier hydrogen—especially considering its future competitiveness, as the use of hydrogen for decarbonization in key industrial sectors is indispensable. International cooperation with both importing and exporting countries is essential. Mistakes from the past, such as one-sided dependencies, must be avoided. When selecting future partners, economic, social, and political factors must all play a central role.”

Participating Institutions

The HYPAT project, led by Fraunhofer ISI, included contributions from the Chair of Environmental/Resource Economics and Sustainability at Ruhr University Bochum (RUB), Fraunhofer Institute for Energy Infrastructures and Geothermal Energy IEG, Fraunhofer Institute for Solar Energy Systems ISE, German Institute of Development and Sustainability (IDOS), Energy Systems Analysis Associates (ESA²) GmbH, Institute for Advanced Sustainability Studies (IASS), German Energy Agency (dena), and Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH. The project was funded under the “Hydrogen Republic of Germany” ideas competition by the Federal Ministry of Education and Research (BMBF).