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Global Economy

It still snags with the hydrogen

The stock exchange is considered a seismograph – it has a nose for new, promising developments, they say. But when it comes to hydrogen, investors have so far gotten a bloody nose. "And one or the other group of investors will also be busy dabbing and cooling their bloody noses," says Felix Schröder, hydrogen analyst at Union Investment. At the beginning of 2020, hydrogen stocks were the big hit. But due to a lack of orders and applications, the house of cards collapsed. Not for the first time – hydrogen was already a hype on the stock market at the turn of the millennium. Even then, the hydrogen dreams burst.

A subsidy so far

But now it should finally start. The old federal government launched the National Hydrogen Strategy. The new one is stepping up the pace: by 2030, the output should increase to ten gigawatts – doubling what was previously planned. It is very important, according to hydrogen analyst Schröder, that this strategy is initially aimed at "making green hydrogen economically competitive".

So far, green hydrogen production is actually a subsidy business. According to studies, the production of "green steel" costs up to 70 percent more than conventional steel. The car or the washing machine would then become significantly more expensive. But in order to achieve the energy transition, there is no way around it, says Karsten Pinkwart, hydrogen expert at Karlsruhe University of Applied Sciences. "We absolutely have to get going, and we can't wait any longer. After all, all of our industries are ultimately based on fossil fuels."

Speed and know-how count

And that's the catch. Fossil energy is still too cheap in comparison, and there is still a lack of production capacity for hydrogen, for example for electrolysers that convert water into its components – a highly competitive market. There are over 100 national hydrogen strategies worldwide. Speed and know-how count here.

"We are a country of engineers, we are a country of machine builders," says Pinkwart. "We can play this card much better than that of the raw material supplier." That is why Germany definitely has a say in this.

Stock exchange plans at Thyssenkrupp

Countless hydrogen projects are currently underway – in universities and in companies. The steel industry is at the forefront. Thyssenkrupp wants to list its hydrogen subsidiary Nucera on the stock exchange in the first half of the year – but it is said that the price will have to be reduced. Siemens Energy is also in the starting blocks. The industrial gases manufacturer Linde is also an important player on the hydrogen market.

But is it really a boom? "It's already happening – we're right in the middle of it," believes expert Pinkwart. Hydrogen analyst Schröder is a little more skeptical: "Of course, we always have to be a bit careful with the term boom."

But the nine billion euros that the federal government is making available for hydrogen projects are also a strong argument for him. But in the end, will all stock market dreams come true for hydrogen? That remains to be seen.

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