This article is based on an interview with Thorsten Herdan, CEO of HIF EMEA, originally published in the German daily Tagesspiegel. In the interview, Herdan discusses the challenges facing Europe’s green energy transition and emphasizes the urgent need for regulatory reforms to enable the large-scale import of synthetic fuels and green hydrogen.
By Thorsten Herdan, CEO at HIF EMEA
The national import strategy for green hydrogen and derivatives has been adopted. However, a range of European regulations is hindering a key goal of this strategy: the sustainable ramp-up of green fuel and chemical markets. Without swift action, Europe risks falling behind in this global race.
Import Strategy: Vision vs. Reality
The German government recently outlined its plan to import green hydrogen and derivatives like e-SAF, e-methanol, and e-ammonia to achieve climate goals in aviation, shipping, mobility, and chemical industries. While the strategy is promising, delays in investment decisions are stalling progress. Without concrete steps within the next 12–18 months, Europe might miss its 2030 targets, and these essential fuels could be diverted to regions with less burdensome regulations.
Europe’s goal to import ten million tons of green hydrogen annually by 2030 faces significant hurdles. Many assume there’s still ample time, but this view ignores the realities of project timelines. Only the projects reaching final investment decisions within the next year and a half will be able to deliver hydrogen and e-fuels by 2030. Currently, only a handful of global projects appear capable of overcoming these hurdles.
Key Challenges Hindering Progress
1. Regulatory Uncertainty
The EU’s strict and unclear rules on green hydrogen and e-fuels production create high investment risks. Changes in these rules could retroactively render compliant fuels “non-green,” deterring long-term investments. Investors and customers need regulatory guarantees—commonly referred to as “grandfathering”—to ensure that rules set at the time of investment decisions remain stable for the entire 15–20 year duration of supply agreements.
2. Exclusion of Potential Suppliers
EU regulations exclude green hydrogen from countries like the U.S., where tax incentives lower production costs. This forces European buyers to pay up to 30% more for similar products or abandon cost-effective imports altogether. This exclusion is driven by EU rules meant to prevent double-counting of subsidies, but it effectively removes some of the most competitive global suppliers from the market.
3. Strict CO₂ Source Rules
EU rules for CO₂ sources further limit production. For instance, CO₂ captured in regions like Chile or Morocco is only permissible if these countries implement EU-equivalent carbon pricing—an unrealistic requirement for many. Additionally, the EU does not recognize internationally accepted sustainability certifications for CO₂, complicating imports.
To circumvent these challenges, some companies are considering transporting CO₂ from Europe to non-EU countries for e-fuel production and then shipping the resulting fuels back to Europe. This “CO₂ tourism” raises serious questions about the efficiency and practicality of current regulations.
A Call for Reform
The absence of a reliable regulatory framework has left Europe with few long-term supply agreements for e-fuels. Customers in industries such as aviation, shipping, and chemicals need certainty that the fuels they purchase today will remain classified as “green” throughout the entire lifecycle of their use. The incoming European Commission must act urgently to revise these regulations, ensuring clarity, feasibility, and competitiveness in the global green fuel market.
Without these reforms, Europe risks being sidelined as other regions move forward with less burdensome frameworks, securing both investment and supply chains for green hydrogen and synthetic fuels. The time for action is now.
Thorsten Herdan is the CEO of HIF EMEA, overseeing operations in Europe, the Middle East, and Africa. Previously, he led energy policy at Germany’s Federal Ministry for Economic Affairs and Energy (2014–2022).
Source: Standpunkt Thorsten Herdan, CEO at HIF EMEA, originally published in Tagesspiegel.