VVD and D66 want greater ambitions with green hydrogen: 8 gigawatts in 2030

The Netherlands must double its current efforts towards sustainable hydrogen production. In order to lead the way in this area in Europe by 2030, the subsidy system for sustainable initiatives will have to be overhauled early next year.

That is the core of the hydrogen plans that the parliamentary parties of the VVD and D66 will announce on Wednesday. The two largest coalition parties of the Rutte IV cabinet want to be able to produce 8 gigawatts (GW) of green hydrogen in the Netherlands by 2030. The target of the previous cabinet was much lower with 3 to 4 GW.

Hydrogen plays an important role as an alternative to fossil fuels in the plans to make the Netherlands more sustainable. The energy carrier can be produced sustainably via electrolysis, in which water is split into hydrogen and oxygen. That requires a lot of green energy. For the current hydrogen ambitions, offshore wind production will already be doubled to 21 GW in 2031.

It is not yet clear in the VVD-D66 plan whether more offshore wind farms need to be built in order to implement the hydrogen plans. Part of the electricity that the parks will generate in the coming years, “cannot be used on the stranded electricity grid,” the two parties write in their plan. That part can then be used for hydrogen. The parties propose to use some wind farms exclusively for the production of hydrogen. That option needs to be further explored. “If more wind is needed at sea, we should do that,” says D66 MP Raoul Boucke.

broad support

The fact that the Dutch government should focus on green hydrogen can count on broad political support in the House of Representatives. a motion to ‘intensify’ the government’s plans for hydrogen to ‘acquire a leading role in the hydrogen transition in Europe’ received broad support in 2020. Only PVV and FVD voted against. The idea is that the Netherlands can use the gas infrastructure to transport hydrogen, and the North Sea to generate the necessary electricity via wind turbines.

The hydrogen that refineries and the chemical industry already use as a raw material is produced with natural gas. In the coming years, hydrogen must be produced in a sustainable way, especially with the help of electricity from offshore wind farms. It is expected that hydrogen will increasingly replace the use of fossil fuels in industry. Companies such as BP, Shell and RWE already have concrete plans to build electrolysers in the Netherlands.

In the coalition agreement it has been agreed to allocate 15 billion euros in subsidies for ‘high-quality renewable energy carriers’. It is likely that 5 to 10 billion of that will be used to boost the production and transport of green hydrogen, wrote NRC earlier† It is not yet clear what will happen with that money.

Roadmap

Before the summer, Minister Rob Jetten (D66, Climate and Energy) will present a so-called road map for the Dutch plans for hydrogen. VVD and D66 set the bar high for Jetten, by already speaking of a doubling of Dutch production compared to the earlier plans.

One of the problems is that potential customers from industry and hydrogen producers are waiting for each other to make investments. “The government has to solve that chicken-egg problem,” says Member of Parliament for the VVD Silvio Erkens. “Among other things, by making agreements with those companies.” And by providing subsidies.

According to VVD and D66, green hydrogen will only get off the ground if production, infrastructure and consumption grow at the same pace. The aim is also to import a serious amount of hydrogen (4 GW) to accelerate the construction of infrastructure. The existing Dutch gas network can largely be used for this, so that very large investments are not necessary.

According to VVD and D66, a quick adjustment of the subsidy rules is necessary because the hydrogen plans are still too expensive to qualify for government support. Under the current subsidy rules, the cheapest alternatives to fossil energy are given priority. The coalition parties want an alternative to be introduced early next year, in addition to the existing SDE++ subsidy scheme.

Member of Parliament Boucke of D66 is not afraid that the cabinet runs the risk of betting on the wrong horse with all these extra billions. “We know that we need green hydrogen to make the industry greener. At companies such as Tata Steel, that is not possible with electrification. This is a unique opportunity for the Netherlands.”