Oct 20, 2022 · 44m · catalyst
What’s holding up hydrogen in Europe?
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this episode of Catalyst, host Shail Khan and clean hydrogen consultant Gnevamir Fleece examine why Europe's clean hydrogen economy faces severe project deployment delays despite aggressive REPowerEU targets, detailing the regulatory bottlenecks, international supply chain dynamics, and deindustrialization risks shaping the sector.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Shayle holds 42.4% of the talking time here. How this is scored →
Shayle as informed peer 6.5 Guest teaching 4.0 Guest disagreement 1.3 Shayle pushing back 1.5
speaking balance: gold is Shayle, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 15:21 Gnevamir rejects the energy crisis framing
Gnevamir directly rejects Shayle's premise that the energy crisis caused regulatory loosening, instead pointing to European industry lobbying leveraging the US IRA.
Hardest push from Shayle ▶ 17:31 Shayle defends the necessity of additionalityShayle pushes back on treating additionality lightly, arguing that without it, high hydrogen subsidies create a zero-sum drain on decarbonizing the broader power grid.
Biggest teaching moment ▶ 15:48 Gnevamir cites Florence School of Regulation dataGnevamir educates Shayle on the economic reality of hourly temporal matching, citing empirical findings that it only creates a 10% price difference in levelized hydrogen cost.
Shayle holds their own ▶ 36:47 Shayle breaks down balance-of-plant system costsShayle demonstrates deep technical and market knowledge by explaining why cheap mass-produced stacks do not guarantee cheaper hydrogen systems if balance-of-plant integration is inefficient.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Shayle as informed peer | Guest teaching | Guest disagreement | Shayle pushing back | Why |
|---|---|---|---|---|---|---|
| Pre-War Context and REPowerEU Ambitions | 5 | 4 | 1 | 1 | Shayle prompts Gnevamir on the pre-war baseline and EU policy framework. Gnevamir outlines the Renewable Energy Directive and funding mechanisms, while Shayle clarifies the relationship between EU and national subsidies. | |
| The Rules Debate: Additionality, Temporal, and Geographic Correlation | 8 | 6 | 3 | 3 | Shayle delivers a detailed breakdown contrasting US IRA tax credits with EU 3-pillar criteria (additionality, temporal, geographic). Gnevamir politely reframes Shayle's thesis, arguing regulatory dilution was caused by IRA lobbying panic rather than the energy crisis, citing a Florence School study. | |
| Regulatory Paralysis and the FID Bottleneck | 6 | 4 | 1 | 1 | Gnevamir explains the trilogue stalemate between EU institutions, while Shayle articulates how developers are navigating the uncertainty by building to the strictest possible compliance standards. | |
| Mid-Roll Commercial Break | 8 | 4 | 1 | 2 | Following the mid-roll ad read, the two discuss hydrogen transport carriers. Shayle demonstrates high domain literacy by analyzing roundtrip synthetic LNG costs and the direct-use benefits of methanol for maritime transport. | |
| Electrolyzer Manufacturing, China Competition, and Tech Options | 8 | 3 | 1 | 2 | Shayle and Gnevamir evaluate whether Chinese electrolyzers will replicate the solar supply chain takeover, with Shayle detailing how balance-of-plant costs can swamp cheap stack manufacturing. | |
| Deindustrialization Risks and the Future Outlook | 4 | 3 | 1 | 0 | Gnevamir synthesizes the long-term trade-offs between expensive domestic production, deindustrialization risks, and potential job displacement, with Shayle wrapping up the discussion. |
Statements from this episode (15)
Kann: IRA tax credits will supercharge the US clean hydrogen market
“The Inflation Reduction Act contains some very rich tax credits for low carbon hydrogen production that are, and I can say this with 100% certainty, Going to supercharge the market from a truly infant stage where it is today.”
Kann: Developing European regulations create headwinds for clean hydrogen projects
“You've got a regulatory construct that is still very much in development in Europe, and that is causing some Significant headwinds for anybody who's trying to actually get something built in hydrogen in Europe.”
Fleece: Regulatory delays stalled announced European hydrogen projects before final investment decisions
“The issue was that everybody was waiting for that regulation. So everybody was waiting for the decarbonized gas package and the hydrogen package, as well as the delegated act, which specified these renewable rules. So lots of projects announced, very little pr…”
Fleece: Hourly versus yearly temporal correlation shifts hydrogen costs by 10 percent
“The difference between Even yearly and hourly temporal correlation, the difference in, in the levelized cost of hydrogen and how that impacts the price of hydrogen is not that much. There has been recently, very recently in September, an excellent paper from t…”
Fleece: Relaxing hydrogen correlation rules will increase gas burning and insecurity
“In fact, if you have super relaxed rules, which you would base purely on renewable energy credits, or maybe guarantees of origin with no form of additionality whatsoever, you would actually Increase energy insecurity, because you'd be burning more gas than if …”
Fleece: Mandating both additionality and temporal correlation is overly stringent
“I think temporal correlation, in terms of absolute emissions abatement, I think temporal correlation or additionality or good principles, both together you know, that's a little bit, that is quite a bit stringent.”
Fleece: One day of local storage makes green hydrogen projects viable
“I think hydrogen storage, local hydrogen storage, not necessarily huge salt caverns, but, you know, a day's buffer worth will be enough to make some of these export projects or many projects actually fly.”
Fleece: Cheaper renewables abroad will drive industrial production out of Europe
“So I think we will, in the end, see some industrial shift out of Europe, just because it'll be, some countries have natural competitive advantage in, in, in access to cheaper renewable resources, and thereby,
Making their hydrogen production costs lower.
and …”
Fleece: Liquefied hydrogen is already transported between Australia and Japan
“Actually liquefied hydrogen is already being transported between Australia and Japan.”
Fleece: Around 80% of hydrogen transport projects use ammonia
“Frankly, most of these projects, I think something like 80% use ammonia as a hydrogen carrier”
Fleece: Imported ammonia will be used directly rather than cracked to hydrogen
“I think, at the end of the day, what's going to happen is that ammonia is going to be sold into international markets for, as ammonia.”
Fleece: Sunfire reached 84% LHV efficiency at Salzgitter steel plant
“We've just seen Sunfire say that they've reached 84% lower heating value efficiency by integrating their solid oxide electrolyzer at the Salzgitter Salzgitter clean steel plant.”
Fleece: Electricity accounts for 75 percent of levelized hydrogen production costs
“Actually 75% of your levelized cost is down to your electricity cost and natural capex.”
Kann: Electrolyzer winners will be determined by scaling speed, not paper specs
“One of the other lessons from solar was like the best technology on paper did not necessarily win out. What won out at the end of the day was who could get to scale and who could manufacture quickly when the market was ramping. And I think we'll see something …”