Only 17% of EU hydrogen project pipeline to materialise by 2030
New data from Westwood Global Energy Group (Westwood) highlighted that despite significant ambitions and substantial funding commitments, Europe is unlikely to meet its 2030 hydrogen production targets.
In its recent whitepaper, “Europe’s Hydrogen Future: How Much Is Realistically Achievable?” Westwood research reveals only 17% of the EU’s planned project pipeline is expected to materialise without market intervention.
The analysis points to a European pipeline under strain, as regulatory delays, elevated costs and weak demand weigh heavily on progress , with 23 hydrogen projects totalling 29.2 GW(LHV) already stalled or cancelled by the close of 2024.
Moreover, the UK market presents a similar story, with Westwood estimating a potential delivery range of just 1% to 24% of its pipeline by 2030, underlining the sizable policy, funding and mandate shortfall.
Subsidies alone have not closed the cost gap between renewable and fossil-based hydrogen, leading to a shift towards targeting key demand sectors and facilitating offtake agreements. While the European Hydrogen Bank has introduced changes, the effectiveness of these measures remains to be fully seen. Similarly, delays and uncertainties in the UK’s funding schemes pose challenges, with further results needed to determine how these approaches may enhance project viability in the future.
In addition, mandates have real potential in driving hydrogen demand by targeting specific sectors with binding targets, penalties, and incentives. While the EU has several mandates set for 2030, the UK only has a single mandate in aviation, which does not explicitly require hydrogen use, revealing a gap in the UK’s hydrogen strategy. Effective implementation of these mandates, particularly in sectors with the greatest decarbonisation potential, will be crucial for achieving meaningful progress.
However, despite the stark outlook, the research also outlines a best-case scenario for the market, where 70% of the current EU pipeline could materialise if planned frameworks are effectively developed and implemented.
In this scenario, the EU could reach its 2030 production targets, underscoring the importance of effective progress.
The gap between ambition and reality in Europe’s hydrogen sector is widening. While targets are necessary, they will remain out of reach unless the policy landscape evolves. For the UK in particular, without sharper coordination and a clearer demand-side focussed approach, there is a potential risk of falling behind.
…said Jun Sasamura, Hydrogen Manager, Westwood.
David Linden, Head of Energy Transition, Westwood, added that while it is easy to focus on the challenges, it should be acknowledged that delivering 17% (12 GW(LHV)) of the EU’s pipeline still represents substantial progress. European governments are increasingly adopting a more realistic perspective on hydrogen’s role in the economy.
Governments must now act decisively on the three critical areas that we have identified to ensure continued progress.
…said David Linden.
To remind, in February, Hydrogen Europe and 16 European associations committed to the development of the hydrogen market, released a joint statement asking the European Commission for a revision on the European Hydrogen policy in order to adjust the course at the EU level.
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