Germany's Ambitious Plan for Hydrogen-Ready Gas Power Plants
Key Ideas
- Germany plans to tender 5GW of hydrogen-ready gas power plants and 2GW of modernisations by 2025 as part of its renewable energy drive.
- The Power Plant Safety Act requires the plants to switch to green or blue hydrogen by their eighth year of operation, with a full transition to 100% hydrogen expected between 2035-2040.
- Subsidies for moving from gas to hydrogen will cover 800 full-time hours of use per year, with an investment cost supported by the government.
- The country aims to enhance security of supply during low demand periods with the addition of 5GW of new gas-fired power plants and a technology-neutral capacity mechanism operational by 2028.
The German government has revealed an ambitious plan to transition towards renewable energy by tendering 5GW of hydrogen-ready gas power plants and 2GW of modernisations as part of its renewable energy drive. These power plants will need to switch to green or blue hydrogen operation in accordance with the National Hydrogen Strategy by their eighth year of operation, with a complete transition to 100% hydrogen expected between 2035 and 2040. Subsidies will be provided to cover the investment cost of moving from gas to hydrogen, supporting 800 full-time hours of use per year. The government's strategy also includes the addition of 5GW of new gas-fired power plants to improve security of supply, especially during periods of low demand, and the implementation of a technology-neutral capacity mechanism by 2028. This initiative aims to make the electricity system more resilient to high proportions of renewable energies and provide additional security during times of low wind and solar availability. With renewables contributing 52% of Germany's electricity consumption in 2023, up from 46% in 2022, the country is making significant strides towards a cleaner energy future. Despite a reduction in subsidies from €16bn to €7.5bn for the construction of hydrogen-ready gas-fired power plants, the funding for the programme will be drawn from Germany's Climate Transformation Fund.