South Africa and Germany seek to develop green hydrogen links

A joint declaration of intent concerning green hydrogen was signed recently by Kgosientsho Ramokgopa, South Africa’s minister of electricity, and Robert Habeck, Germany’s minister of economic affairs and climate action.

The declaration supports the establishment of a joint hydrogen taskforce “to drive the commercial viability of green hydrogen projects, industry and infrastructure in South Africa and Germany”, according to a statement issued by the South African government.

Johannesburg-based energy projects expert Jurg van Dyk of Pinsent Masons, and Njabulo Gumede, also of Pinsent Masons, said growth of the green hydrogen economy is imperative as part of developing clean energy solutions in response to the climate crisis.

Van Dyk said: “South Africa has some of the best solar and wind resources, and has evidenced its ability to develop new sectors through the South African government’s Renewable Energy Independent Power Producer Programme. All of this bodes well for establishing South Africa as a major developer and exporter of green hydrogen.”

“This South African and German initiative comes against the backdrop of South Africa’s ambitions to become a key exporter of green hydrogen products with the global green hydrogen export market currently valued at $300 billion. These factors make South Africa a major stakeholder in the future of the green hydrogen export market,” he said.

“The South African government has outlined the creation of a ‘hydrogen valley’ that will encompass areas like Limpopo, Johannesburg, and Durban. The formation of the valley is aimed at creating projects that will jumpstart hydrogen projects in hubs for purposes of driving economic growth and job creation,” van Dyk said.

The joint taskforce is expected to serve as a platform for the exchange of information and assessments pertaining to upscaling green hydrogen production, as well as identify specific “lighthouse projects” that both governments might get behind. Its objectives will also include to connect South Africa’ green hydrogen developers with German off-takers and foster closer relations between government, industry, and research institutes from both countries.

The taskforce is also expected to identify challenges to the development of the South African and German green hydrogen value chain. This might include helping grey hydrogen producers in their transition from grey to green hydrogen. Funding mechanisms to support the scale up of green hydrogen and Power to X’ (PtX) value chains are also expected to be explored by the taskforce. Germany’s green hydrogen subsidy scheme, H2Global, could, for example, be deployed in the context of projects in sub-Saharan Africa, the South African government suggested in its statement.