France, Spain to Pursue €2.5 Billion Hydrogen Pipeline Plan

Alonso Soto
·3 min read
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(Bloomberg) -- France and Spain said they will move ahead with a 2.5 billion euro ($2.6 billion) hydrogen pipeline, easing past tensions over an alternative link as they seek to boost their status as European energy suppliers.

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The project will connect Portugal and Spain with France to transport about 10% of the bloc’s green hydrogen demand by 2030. French President Emmanuel Macron and Spanish Prime Minister Pedro Sanchez, as well as Portuguese premier Antonio Costa and European Commission President Ursula Von der Leyen took part in a meeting in Alicante, Spain, on Friday.

“This green corridor will give more security and strategic autonomy to the European Union,” said Sanchez, who hosted the gathering before a forum of leaders from southern Europe later Friday. The new pipeline is part of the Spanish administration’s €16 billion investments in green energy.

Plans for a sub-sea pipe connecting Barcelona with Marseilles, known as H2Med, fit within Europe’s broader push to diversify its energy supplies away from Russian gas. Initially, H2Med was presented as a pipe that would transport gas for several years before shifting to hydrogen. But the option of carrying the fossil fuel was dropped this week to make the project eligible for EU funding earmarked for clean energies.

The optimal route to link Barcelona and Marseilles has a length of 455 kilometers at a maximum depth of 2.6 kilometers, according to a join presentation of the project. The governments are analyzing two other routes that are lengthier. The link between Portugal and Spain will cost an additional €300 million and could be ready in four years, Portuguese Environment Minister Duarte Cordeiro told reporters.

“We want to make hydrogen a central part of our energy system in the transition to net zero. And we want to maintain our European trailblazers position, as we build a global market for hydrogen,” von der Leyen told a joint news conference.

Production Plans

“We will produce ten million tonnes of renewable hydrogen in the EU by 2030. And we plan to import in addition another 10 million tons. Hydrogen that will have to reach our industry,” von der Leyen said.

Plans to build the hydrogen pipe were first announced in October, as France sought to end years of discussions over the construction of a gas pipeline through the Pyrenees, which was supported by Spain and Portugal and, more recently, by Germany.

Although so-called green hydrogen, which is produced from renewable energies, is yet to prove a viable large-scale source of energy, companies and governments are already outlining plans to start producing it. If the Barcelona-Marseilles pipeline does go ahead, it isn’t expected to be ready before 2030.

France and the two Iberian nations are expected to apply by a Dec. 15 deadline for EU financing for the pipeline, which also includes infrastructure linking Spain and Portugal. The European Union could pay for up to half of the project if approved.

Spain is betting on the new pipeline as part of a strategy to become a European green hydrogen hub, taking advantage of cheap solar generation. To help fulfill its ambitious, the government is backing local refiner Cepsa SA’s plan to build Europe’s largest green hydrogen facilities in the southern region of Andalusia by 2028. Local oil firm Repsol SA is also developing large hydrogen projects.

--With assistance from Thomas Gualtieri, Samy Adghirni and Joao Lima.

(Updates with details on project from fifth paragraph)

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