The so-called green molecules —such as renewable hydrogen and its derivatives (ammonia or methanol), second-generation biofuels, or biomethane— could reduce Europe’s external energy dependence by around half by 2040. According to the report “Why Europe needs green molecules?” prepared by Moeve together with PwC, these alternative fuels could replace up to 40% of the current demand for fossil fuels, while advancing the climate neutrality objectives set out in the Green Deal and the “Fit for 55” and “REPowerEU” regulatory packages.
The document calculates that robust domestic production of green molecules would reduce the European Union’s energy dependence by 50%, from the current 57% to 28% by 2040, which would significantly strengthen the security and stability of energy supply on the continent.
Looking ahead to 2050, the study —based on public sources and reports from consulting firms and which will be presented this Thursday in Brussels to institutional representatives and business executives— projects that the growing importance of these molecules could replace up to 50% of the demand for fossil fuels, also reducing it to 28%. In this scenario, green molecules would represent approximately one-third of the European energy mix and would allow for a 22% reduction in CO2 emissions.
In addition to reducing external dependence, the deployment of this new energy value chain would open the door to an emerging industry capable of generating 1.7 million new jobs and adding 145 billion euros to the EU’s GDP, according to ManpowerGroup estimates cited in the report.
The study emphasizes that the current decade will be key to laying the foundations for the massive deployment of green molecules in the coming decades.
The CEO of Moeve, Maarten Wetselaar, pointed out that, in a global context of growing geopolitical tensions and vulnerability in energy supply chains, “Europe’s strategic imperative is clear: to guarantee energy autonomy.”
In his opinion, green molecules produced on European territory offer “a firm roadmap towards a resilient, competitive, and energy-independent Europe, while positioning the continent as a global leader in the fight against climate change.”
“With the right boost, European champions can exponentially develop these clean energy solutions, but the time to act is now,” he added.
Decarbonizing sectors where electrification is not enough
The Moeve and PwC analysis assigns a central role to green molecules as a tool for decarbonizing hard-to-electrify sectors, including heavy industry, chemistry, and long-distance transport. These segments currently account for between 20% and 25% of primary energy demand, and according to the report, the use of green molecules could cut their CO2 emissions by up to 22% by 2050.
Although the study acknowledges the existence of the current ‘green premium’ (a surcharge compared to conventional alternatives), it predicts that its economic impact will be diluted along the value chain. Thus, the final effect on consumer prices would be limited to moderate increases of between 1% and 5% from the 2030s onwards.
For example, the maritime transport of a pair of sneakers costing 100 euros from Asia to Europe would barely incur an additional cost of around 50 cents if renewable fuels are used. In the case of green steel, its use instead of traditional steel would increase the final price of a car by around 2%. And in aviation, the regulated introduction of sustainable aviation fuels (SAF) would result in a limited increase in ticket costs, ranging from 1 to 40 euros depending on the flight distance.
In general terms, the report anticipates that the cost gap between fossil fuels and green molecules will narrow as the price of CO2 emissions increases, renewable energy costs continue to fall, and the efficiency of producing fuels from biomass and hydrogen improves.
Second-generation biofuels—already present in road (HVO), maritime, and air (SAF) transport—are expected to reach cost parity with fossil fuels during the 2030s. Subsequently, in the 2040s, the costs of synthetic fuels based on green hydrogen are also expected to approach parity.
The report also identifies that Southern Europe, and particularly the Iberian Peninsula, has “exceptional potential” to produce green hydrogen at very competitive prices, with cost levels practically 50% lower than those in Central and Northern Europe.
Spain and the Iberian Peninsula, a key hub for green hydrogen
Along these lines, the document highlights that Spain and the rest of the Iberian Peninsula hold a leading position in the development of Power-to-Hydrogen (PtH) technology. The region has set the most ambitious electrolysis capacity targets in Europe by the end of this decade, with an expected production of 0.39 million tons per year (Mtpa) of renewable hydrogen in Spain, linked to 3 gigawatts (GW) of installed capacity — ahead of other benchmark markets such as Germany — and 0.9 GW in Portugal. All of this is supported by abundant solar and wind resources that guarantee a very low electricity generation cost.
“Iberia could produce green hydrogen at approximately half the cost compared to Central Europe and the Nordic countries,” the study emphasizes, citing the analysis by Goldman Sachs Carbonomics, which positions the Peninsula as a future major large-scale supply hub for the European market.
Within this Spanish strategy for renewable hydrogen, the report mentions emblematic projects such as the approval by Moeve of the first phase of the Andalusian Green Hydrogen Valley (Onuba), with 300 MW, considered the largest green hydrogen project in the EU exclusively dedicated to the energy sector. It also includes the recent installation of a 100 MW electrolyzer by Repsol at Petronor’s facilities, as well as initiatives promoted by BP and Iberdrola in Castellón, with 25 MW.
Regulation, investment, and alliances to scale green molecules
For green molecules to unleash their full potential, the report calls for coordinated action between public administrations and the business sector to accelerate the consolidation of these new energy ecosystems.
Among the priorities, the study points to the need to promote regulatory frameworks that generate a clear market and stable demand signals; implement economic support mechanisms to close the cost gap in the initial phases; and expand infrastructure and innovation throughout the entire value chain — production, transport, and storage. Likewise, it advocates for strengthening public-private partnerships to mobilize large-scale investment and achieve industrial deployment of these energy solutions.
