The future of Germany: changes and opportunities
We are living in a time of change. What about the future of the country? What are the innovative ideas? This is the theme of the great SZ focus “Future Germany”. All articles as well as other analyzes and reports are available on this page.
Christoph Noeres has been with the company for almost 20 years, but he never had such a start. His employer Uhde Chlorine Engineers (UCE) from Dortmund actually builds systems that extract pure chlorine from water and salt. It works with electricity in many small cells that can be assembled into meter long electrolysers. Because chlorine is not only used in swimming pools or the famous chlorinated chickens, but also as a raw material for chemical factories.
The market has seen solid growth over the years, but now whole new opportunities are opening up. UCE is increasingly turning to electrolysers that work without salt or chlorine. They divide water into elements: hydrogen and oxygen. “My job is to develop this activity”, explains Noeres, head of the so-called green hydrogen division at UCE. “We want to help shape the energy transition in the world. It looks like a new start, made in the Ruhr area.
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Christoph Noeres has every reason to be in a good mood: the hydrogen production for which he is responsible at Uhde Chlorine Engineers is in great demand.
(Photo: Uhde Chlorine Engineers)
To understand Noeres’ assertion, a look to the future is useful: Germany wants to become climate neutral by 2045, other countries want to follow suit. For this to be successful, virtually no fossil fuels can be burned: wind turbines replace coal-fired power plants, electric cars replace gasoline vehicles, and heat pumps heat homes without gas. But some processes cannot be converted into green electricity, explains Kilian Crone of the German Energy Agency (Dena). “Green hydrogen is a solution so that such processes can still become climate neutral.” For example steelworks: You can also turn iron ore into iron and steel with hydrogen instead of coal. This protects the climate if hydrogen was previously produced with renewable energies.
This brings you back to Noeres and his electrolysers.
A few years ago, they only built very small systems for hydrogen, explains the doctor of engineering. “But over the past two years, interest has grown by leaps and bounds.” Because more and more countries want to become climate neutral. And the green electricity needed for electrolysis is available in ever greater quantities. “We are seeing a wave of projects,” Noeres explains, “especially in Europe and North America, Australia and China”.
UCE wants to quintuple its capacity – and create new jobs in the Ruhr area
Earlier this year, the 48-year-old landed an order from Canada: the electricity company Hydro-Quebec is one of the largest hydroelectric companies in America. UCE is currently building an electrolyser near Montreal that will use renewable electricity from Hydro-Quebec to produce 11,000 tonnes of hydrogen per year. The company talks about one of the largest green hydrogen plants in the world. Hydro-Quebec wants to use hydrogen to produce biofuels. The carbon that is also required for this should come from residual waste instead of oil.
Such orders create new jobs at UCE in the Ruhr area. “In the last three months alone, we have doubled the number of our engineers,” says Noeres. And sales are also expected to grow: “Overall, we want to almost double the number of our employees at the company headquarters in Dortmund in the coming year. More recently, UCE had at least 400 employees.
With today’s supply chain, the company can already build water chlorinators with a capacity of one gigawatt per year, explains Noeres. That would be enough for a good eleven projects of this size in Canada. But UCE wants more: “We want to go to five gigawatts by 2025.” In addition, production has so far only been linked to the project, not yet in stock. “We will change that in the years to come,” Noeres announced.
So far, one third of EUA is held by the Italian company Industrie De Nora – and two thirds by the Thyssenkrupp group. He suffered years of losses, also from the Corona crisis, and in fact sees his future more in the steel business and automotive supply than in factory building. Thyssenkrupp is therefore still looking for a way to finance the growth of UCE. The Dortmund subsidiary has good preconditions to benefit from the demand for water electrolysers, the parent company said. “We want to use this head start.” We are therefore also examining a possible IPO of UCE. Thyssenkrupp could, of course, still have a partial stake in the company.
Green hydrogen is still more expensive than climate-damaging alternatives
Despite all the euphoria, one can of course object that many industries already need hydrogen today – for example chemical plants or refineries, for example for the production of fuel. These industries only produce hydrogen from natural gas, which is harmful to the climate. The big advantage: this so-called gray hydrogen is much cheaper than the green hydrogen from the electrolyser.
Noeres knows how important it is to reduce manufacturing costs: both the price of the systems and the operating costs. “We want to manufacture faster and easier,” explains the head of UCE. “But it’s also about reducing electricity consumption during electrolysis.” According to experts, the costs of electricity constitute the largest part of the costs of producing green hydrogen. Noeres sees it as a prudent hope. “The costs of producing renewable electricity are gradually decreasing.” Record-breaking projects in the Middle East, for example, now produce electricity for less than two cents per kilowatt hour. For comparison: Basically in this country, a kilowatt hour of electricity this year has cost an average of six to 19 cents.
However, wind turbines and solar systems have become considerably cheaper and more efficient in recent years. “More and more projects are moving in this direction”, explains Noeres. In addition, more and more countries are increasing the cost of fossil fuels such as natural gas in order to create an incentive for climate protection. This too can help green hydrogen to be competitive.
The first housing companies produce hydrogen on a small scale to heat homes
But even if the hydrogen economy starts up, the question remains how it will be structured: will there be more industrial electrolysers like the one built by UCE, which then feed the pipelines with hydrogen, which at their turn lead to big customers? Will the hydrogen even be converted into green ammonia, for example, which is easier to transport by sea? Or will there be more small electrolysers using wind power, for example, to meet a need for hydrogen directly on site, without a long queue?
Dena boss Andreas Kuhlmann assumes that a hydrogen grid – as countries like Germany predict – will not initially be nationwide. “This is why small decentralized generation plants are also important.” The energy expert refers to the early housing companies that used excess solar energy from rooftops to produce and store hydrogen. In winter, this results in fuel cells that produce electricity and heat.
Therefore, there are completely different manufacturers in the electrolyzer market. For example, they rely on smaller systems with special coatings which – depending on the green electricity supply – can be started and stopped more easily. “But that’s not our domain,” says Noeres, the UCE man. Its systems for large-scale industry work best continuously: either with electricity from hydropower, or with a combination of solar power during the day and wind power at night.
So far, Noeres hasn’t worried about betting on the wrong horse. “There will be more bottlenecks in the green hydrogen market than problems in gaining market share.” In any case, experts trust the water chlorinator market more than chlorine systems, the old roots of ECU. Hope begins, so to speak, with H – the symbolic element of hydrogen.
Germany’s hydrogen plans are ambitious
Germany is to become “the world number one” in hydrogen technologies, this target was set by the federal government last year with its national hydrogen strategy. As a result, the state wants to promote the production, transport and use of the energy vector in this country with a total of seven billion euros.
The strategy foresees, for example, that water electrolysers with a capacity of five gigawatts will be built in Germany by 2030. The federal government wants to exempt as much as possible the necessary green electricity from taxes, charges and surcharges – so that green hydrogen does not become too expensive. In addition, the state wants to put in place incentives for chemical factories or refineries to actually use the silver lining. Pipeline operators have the option of reclassifying part of their pipelines for hydrogen.
With an additional two billion euros, Germany wants to promote international partnerships in the field of hydrogen with countries such as Morocco and Ukraine, but also Australia and Saudi Arabia. “Even if Germany exhaust the full potential of renewable energies, we will probably still need energy imports,” explains Kilian Crone of the German Energy Agency (Dena). “Green hydrogen is an energy vector that we can import without using fossil raw materials. In a climate neutral future, the Federal Republic should, if possible, no longer need imports of fossils. “With hydrogen partnerships, Germany can make exporting countries a good offer for the future,” says Andreas Kuhlmann, boss of Dena.