EC plans euro-based hydrogen benchmark by 2021: draft EU strategy

The European Commission plans to develop a benchmark for euro-denominated hydrogen trades by 2021, according to an unofficial draft of its EU hydrogen strategy expected on July 8.

The aim is to reduce European market players' "foreign exchange risks" for hydrogen imports and exports by developing "a structured international hydrogen market in euros," according to the draft made available to the Euractiv news agency on June 22.

"Hydrogen being a nascent market, the commission will develop a benchmark for euro-denominated transactions in hydrogen, thus contributing to consolidate the role of the euro in trade of sustainable energy," the draft said.

There were no further details given, and the EC has a policy of not commenting on drafts.

The currency used for global hydrogen trades is not that important, several industry executives said during the Global Hydrogen Forum 2020 webinar hosted by the International Partnership for Hydrogen and Fuel Cells in the Economy on June 18.

"The currency doesn't matter one bit," Tom Linebarger, CEO of US energy technology company Cummins, said in the webinar.

The most important thing was to build regional-scale centers where clean hydrogen technologies could be deployed "in a serious way" for storage, transport and industrial use, he said.

Southern California was a good example of this, he said, "but we need more of these in more parts of the world."

Jon Andre Lokke, CEO of Norwegian hydrogen technology company NEL, agreed that the trading currency was not the most important element to develop the market.

He wanted more help for industrial customers to scale up demand for clean hydrogen so that suppliers could meet it.

"We want help for the big ammonia producers, the big steel producers to go green at scale," he said. If the market was there, NEL was ready to scale up equipment to supply it and that would cut production costs.

Global trading

But Pierre-Etienne Franc, secretary of the Hydrogen Council and vice president of Air Liquide's hydrogen unit, said that "in the end we will need one single currency" so that hydrogen can be easily traded globally.

Regional players would remain significant, and the jury was still out on which country or region's currency would eventually dominate.

"It could be Australia, the US, Saudi Arabia... it depends who starts," Franc said. "As a European I would prefer the euro, but the most important thing is that there is a single hydrogen trading currency in the future because it would set the benchmark that shows it is an international player."

Jorgo Chatzimarkakis, secretary general of Hydrogen Europe, agreed there should be one currency for trading hydrogen, and said that the EC wanted it to be the euro.

"Europe has this ambition to be one of the central hubs of this new hydrogen market place," he said.