Fraunhofer Institute for Material Flow and Logistics IMLFrom electricity generation to use as a fuel in vehicles – hydrogen offers a wide range of possibilities as an energy carrier. Germany is pursuing the goal of playing a leading role in hydrogen production. This requires international partnerships and supply chains that are transparent and comprehensible. In short: In addition to a hydrogen infrastructure, technologies such as blockchain are also needed to ensure transparency in a reliable and understandable way.
Green hydrogen is a central key to the energy transition – and to achieving a climate-neutral future. The H2 molecule is a versatile energy carrier that can be used in various applications and sectors – from electricity generation to use as a fuel in vehicles. With the “National Hydrogen Strategy,” the German federal government is showing how Germany can use green hydrogen in the areas of industry, transportation and energy to maintain competitiveness, achieve climate protection targets and open up new markets. The strategy combines climate, industrial and innovation policy and aims to help Germany achieve a leading global position in hydrogen production. For the widespread use of green hydrogen, the German federal government supports rapid expansion for a nationwide infrastructure. Therefore, production facilities for electrolysis have to be constructed, and the distribution infrastructure such as filling stations, pipelines and storage facilities have to be expanded to use the energy carrier in different sectors.
The strategy on the federal level also enters into the planning of the German federal states. Wide-ranging potentials in the hydrogen environment result especially for North Rhine-Westphalia (NRW) as an industrial location. NRW has a well-developed infrastructure for hydrogen transport, for example. At the numerous companies from the chemical, steel and machine construction sectors, this energy carrier can be used as an energy source as well as a raw material. The construction of electrolyzers and other hydrogen-related technologies (e.g., tank containers valves, pipelines etc.) could additionally create numerous jobs. By now, the number of hydrogen projects and initiatives in NRW has increased to 300 in the last few years. The initiatives for accelerating hydrogen development in NRW include, for example, H2UB, ProBF, ELEFACT and COSiMa. Fraunhofer IML is also currently planning several projects to develop hydrogen as an energy carrier in industrial applications.
Since the required quantities of hydrogen cannot yet be exclusively produced in Germany, the German federal government also supports the establishment of corresponding international value chains for imports. The state of NRW is also working on an import strategy.
“We want to remain an industrial location while becoming climate-neutral. Therefore, we have to set the right political and business course now. It is important to us to have an import structure that rests on many pillars. A one-sided dependency, such as with gas in the past, must never happen again,” emphasized the NRW minister of economic affairs and energy, Mona Neubaur, in a press release in January 2023.
The entire value chain is now considered – from production to transport and distribution to use. Dependencies must be avoided and increased emphasis placed on sustainability targets at the same time. This means: Even when arranging the necessary cooperations for procuring hydrogen from abroad, politicians and companies have to make sure that the so-called ESG criteria are observed in the production countries. The German National Hydrogen Council already noted the following in its position paper on “Sustainability criteria for import projects of renewable hydrogen and PtX products” in 2021: “It is nevertheless necessary to formulate criteria for a sustainable production and use of hydrogen to ensure that the contribution of hydrogen to a sustainable economy is not counteracted somewhere else. Sustainability issues in the entire value chain, including social consequences in production countries, are of great importance for ensuring the integrity and acceptance of hydrogen (imports) and hydrogen technologies.”
Even before the question of how to enforce one’s own sustainability standards in third countries, the question arises how to record their observance in the first place and ensure traceability. This is where blockchain technology makes a decisive contribution to the energy transition.
In various research and development projects, Fraunhofer IML has shown how tamper-proof, continuous recording and distribution of information is possible in international supply chains. This is the result of experience in other application fields such as the automated referral of available production capacities with subsequent booking and payment as well as the mapping of hazardous goods transports up to data exchange in customs handling. Researchers have used this as a basis to develop solutions for contract negotiation and payroll services processing as well as for implementing these in practice, for example. In addition, blockchain technology is suitable for implementing the digital product passport, which stores product-specific information from raw material extraction to recycling and provides it to the relevant user groups. This comprehensive knowledge in various application fields and the experience gained can also be transferred to the hydrogen economy.
Here, blockchain technology also has the potential to contribute to more security and efficiency in data exchange and to ensure the necessary trust in the information base through transparency regarding data origins or change tracking. Its technological characteristics allow an end-toend verification for green hydrogen, for example – from the producer of the renewable energy to the end user. A blockchain also makes it possible to determine what quantity of green hydrogen was used to manufacture green steel, for example – and thereby answer the question of whether it is actually green steel. For a hydrogen-based (energy) economy, there is thus great potential in seamlessly linking information from all parties of the hydrogen supply chain. The result: Process transparency and traceability by third parties is increased, from the end customer to the regulatory authorities.
Documents and certificates regarding the production of green hydrogen and its use in production and transport processes can be securely stored in blockchain networks, for example. Furthermore, payments between the hydrogen producer and the electricity provider can be automated via smart contracts. A “hydrogen” blockchain network creates the technical basis for mapping the complete hydrogen value chain. In addition to information on the product itself, this value chain also shows compliance with the required ESG standards during the production process. Without such a trustworthy, blockchain-based hydrogen network for keeping such records, a climate-neutral import structure and a domestic production landscape bear the risk of not being enforceable.
