Germany's chemical industry is large and prosperous, but it is also one of the largest sources of greenhouse gas emissions. This needs to change if Germany is to meet its 2045 climate targets – and green hydrogen is at the heart of the solution.
The key point
is that Germany wants to promote the green transformation of its greenhouse gas-intensive chemical industry. Hydrogen energy will be at the core of this transformation, and international companies with ready-made solutions will welcome new business opportunities. For
a glimpse of the future of the German chemical industry, look to the sun-drenched expanses of southern Spain. There is a German company that specializes in developing renewable energy devices. Viridi RE is planning to produce hydrogen and methanol using power from dozens of hectares of photovoltaic panels and wind turbines. The company aims to produce more than 60,000 tons of green hydrogen annually by the end of 2025, all of which will be transported by train to the German chemical plant in Baden-Württemberg, more than 2,000 kilometers north. Daniel Argyropoulos
, Viridi's senior manager of corporate policy and innovation, estimates that when they begin operations in 2025, the company will reduce CO2 emissions by more than 200,000 tons per year. By purchasing methanol produced from renewable sources, Viridi's chemical customers can move closer to their carbon neutrality goals. "At present, the chemical industry is still highly dependent on natural gas, and natural gas is a fossil fuel, and it is the general trend to gradually replace it,
" Ayropoulos said. As a green methanol supplier, we expect that there will be a huge demand for our products in the market. The growth of the market for
green hydrogen (H2) and methanol (CH3OH) is a new area that the German government aims to promote, that is, the government hopes to use the production of hydrogen to decarbonize most sectors of the country's industry, covering everything from automobiles to chemical industries.
"In order to decarbonize further, hydrogen must be green, which means that the goal of renewable energy has been greatly improved.". At the same time, the industrial sector also needs more decarbonization gas. Ayropoulos said.
Now is the opportunity
for change. Germany's huge chemical industry ranks among the top four in the world, accounting for more than 10% of Germany's GDP. On the negative side, chemical synthesis produces 15% of Germany's carbon emissions, and chemical producers are also the world's largest industrial consumers of gas, oil, and electricity.
"The whole chemical synthesis process is accompanied by the use of energy, mainly from fossil fuels.". In order to get out of this situation, the required energy for chemical synthesis needs to come from renewable sources. Said Gerold Neumann, head of Vivevo Energy. The
recently elected German government has set new climate targets to speed up the process of change. "The industry in Germany is under a lot of pressure to become carbon neutral by 2045 and in Europe by 2050," said Joke Rosemeyer (J? Rg Rothermel), a chemist and head of the Energy, Climate Change and Raw Materials Department at the German Chemical Industry Association (VCI). This time is not far away, especially when it comes to the new chemical plant being planned today, which will still be operational in 2045.
Yet there is another factor accelerating the decarbonization of industry. As the world's dependence on oil nears its peak, fossil fuel prices will be more volatile than ever, prompting chemical companies to turn to more predictable sources of energy and raw materials.
Changing the equation
"Hydrogen energy will be at the heart of this process," explains Raphael Goldstein, a chemicals specialist at the German Federal Agency for Foreign Trade and Investment. His prediction is based on a long history of practice. "The chemical industry has become the largest consumer of hydrogen in Germany," he added.
As one of the largest carbon dioxide emission areas in Germany, the chemical industry should at least bear the corresponding decarbonization responsibility proportionally. Currently, the vast majority of hydrogen used to make chemicals is produced by splitting natural gas into hydrogen and carbon dioxide. The result is millions of tons of greenhouse gas emissions. The chemical industry realized that the equation would have to change. "Replacing conventional hydrogen with green hydrogen is the order of the day for the next decade,
" Goldstein said. In theory, the chemistry is simple: use renewable electricity to drive an electrolyzer that splits water into oxygen and hydrogen.
Assuming there is enough renewable electricity, green hydrogen can be produced in unlimited quantities. Moreover, the demand for hydrogen energy will be huge. According to the German Ministry of Economy and Climate Protection (BMWK), by 2030, Germany's demand for hydrogen will be as high as 110 terawatt-hours (TWh), and the hydrogen must be produced by renewable energy sources such as solar, wind and geothermal. By comparison, Germany currently generates about 500 terawatt-hours of electricity. "It is impossible to meet the demand for hydrogen if it is produced only in Germany," Goldstein said.
This means that Germany must import a large amount of green hydrogen energy. As a result, Viridi and other companies are working with companies outside Germany, in addition to building electrolyzers in areas of Germany rich in renewable energy.
Logistics solutions
As the transportation of hydrogen in large quantities is complex at the logistics level, the market is in urgent need of expertise and solutions in this area. In the short and medium term, investors will continue to be optimistic about green methanol produced by renewable energy as an energy carrier. Extensive infrastructure already exists to transport and store liquid methanol, and methanol production can combine hydrogen and carbon dioxide — in other words, it captures carbon and is also a fossil fuel alternative to gas-intensive chemical processes.
Viridi has found solar-rich areas in Spain, setting up hundreds of hectares of photovoltaic panels to produce methanol. Next, they plan to use special trains to transport methanol to Karlsruhe, an important chemical industry town in northern Germany. Once the methanol arrives, "it will become the basis for the production of various chemical products," Ayropoulos said.
Another way is to build electrolyzers and chemical plants in areas close to renewable energy sources. Vivevo is planning to build a hydrogen plant at the chemical park Park Brunsbüttel (ChemCoast Park Brunsb) in the German state of Schleswig-Holstein. The region has easy access to wind energy produced in the North Sea, and future gas pipelines in the region can also be used to transport green hydrogen to customers all over Germany. Great Business Opportunities
for
Investors The above two areas provide great flexibility for foreign investors. "The technology is there, but now we need to further improve the efficiency." "The current technology requires a lot of electricity and the equipment is expensive," Rosemeyer said.
The transition is likely to be as subsidised as renewables were 30 years ago. At present, the European Union is setting up a framework to subsidize hydrogen production in the form of funds from the European Common Interest Major Project (IPCEI).
However, some big questions remain unanswered: for example, does it make more sense to relocate old chemical plants and build new ones close to renewable energy sources, such as the windy North Sea coastline, or should power pipelines be built to deliver green power to existing chemical manufacturing priorities? For example, the "chemical triangle" in southeastern Bavaria or the chemical industry centers such as Baden-Württemberg and Karlsruhe.
Vivevo hopes that the Brunsb Brunsbüttel Chemical Industrial Park, where it is located, will become a future demonstration base. The 100 MW electrolyzer in the industrial park is used to produce hydrogen, which is combined with carbon dioxide produced by a nearby waste incineration plant to synthesize methanol. Subsequently, the synthesized methanol will be sold to other enterprises in the chemical industrial park as a green alternative to traditional natural gas.
"Our industrial consumers are at our doorstep, and green energy is here." "This is also a modular solution that can be replicated in other regions," Neumann said.
As Germany moves to a hydrogen economy, new business opportunities will open up for companies that provide ready-made solutions for the chemical industry. "Germany is the ideal location for you," Neumann said. The German market is very large and provides great opportunities for foreign enterprises.
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