Reducing electricity grid fees and levies could substantially lower European green hydrogen production costs, with current charges adding as much as €5.30/kg in some member states.
That was one conclusion from a recent Hydrogen Europe report, which also claimed fees are expected to rise in tandem with wider investment in the relevant grid infrastructure.
The Clean H2 Monitor report identified significant differences in the network charges, taxes, and levies imposed on electricity supplied to electrolysers across member states.
At the low end, France’s fees were calculated to add just €0.10/kg ($0.11) to hydrogen production costs. In contrast, Poland’s network charges add €1.80/kg ($2.03), with taxes and levies contributing a further €3.50/kg ($3.95), bringing the total to €5.30/kg ($5.97).
Germany, Sweden, Spain, the Netherlands, and France have relatively low additional charges. Notably, the same five countries account for almost 80% of Europe’s electrolyser construction pipeline, according to the same report.
Of those five, the Netherlands and Spain see the highest additional charges, amounting to €1.20/kg ($1.30/kg) and €1.10/kg ($1.24), respectively, while Sweden’s come to just €0.40 ($0.45) and Germany’s €0.20/kg ($0.26).
Germany’s low costs are attributed to electrolyser fee exemptions, while France’s come from reduced charges and excise duty.
Hydrogen Europe argues replicating such measures across the bloc could help to narrow disparities in costs across member states, potentially improving the development of cross-border hydrogen trading.
It has also been calling for the EU to treat electrolysers as a grid flexibility tool that could reduce grid congestion, rather than just another power user.
Germany is nevertheless considering reforms that could expose more electrolysers to network charges, with some trade groups warning these could add €1.5 to €3 to the price of producing a kilogramme of hydrogen.
However, the University of Cologne’s Energy Institute estimated the changes would increase costs by just €0.32/kg ($0.36).
The recommendations also echo industry calls for greater flexibility. Hydrogen Director at Spanish hydrogen developer Moeve, Joaquín Rodriguez, advocated for more flexible
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