As specified above, as one of the main hydrogen producers in the world, Poland has set ambitious goals related to the planned development of hydrogen technologies. These goals and the manner of achieving them were defined in detail in the draft Polish Hydrogen Strategy 2030 with the prospects to 2040 (the “Strategy”), published by the Ministry of Climate and Environment on 14 January 2021. The Strategy has been officially adopted by the resolution of the Polish government passed on 2nd November 2021. However, at the date of publication this Guide, the final version of the Strategy has not been published yet in the Official Journal of the Republic of Poland. For the purposes of preparing this Guide it has been assumed that the final version of the Strategy is compliant with the draft.
The Strategy is meant to respond to the changes taking place in the European and global energy environment, resulting in a shift from conventional fuels to low-carbon solutions. Hydrogen can play a significant role in the decarbonisation process.
Therefore, future actions envisaged by the Strategy are focused on the development of green and low-emission hydrogen economy, and the Strategy itself refers to three sectors enabling the use of hydrogen – energy, transportation, and industry. The Strategy also addresses the methods of producing hydrogen, its distribution, and necessary legal changes for the creation of a stable regulatory environment and rules for financing hydrogen technologies.
The priority areas adopted within the Strategy refer to the concept of combining sectors, which provides for: an increase in the use of electric energy from Renewable Energy Source (“RES”) and its consumption by specified sectors of the economy (such as the transportation sector, various industry sectors and the heating sector – heating of buildings) in order to minimise the dependence on fossil fuels contributing to greenhouse gas emissions to the environment. If renewable hydrogen and the concept of sector combination are implemented, the emission reduction potential in 2050, as compared to 2020, will be approximately 68 per cent.
The Strategy also complies with the actions presented in the draft Polish Energy Policy 2040 (“PEP 2040”), outlining the directions for the energy sector development, taking into account the tasks to be performed in a short-term perspective, which also cover activities related to hydrogen.
The authors of the Strategy also refer to the European regulations and assumptions, which are aimed at achieving climate neutrality by 2050, in line with the EU vision presented in the European Green Deal and the Paris Agreement.
The Strategy emphasises that the hydrogen economy may be developed by establishing the entire value chain and constructing infrastructure which will facilitate its use. Achieving this requires the development of electrolyser installations, a hydrogen distribution network, including creating the relevant transmission and transportation infrastructure, hydrogen storage facilities, refuelling infrastructure, production of fuel cells used in energy, heating, transportation, and other sectors of the economy. The overarching objective of the Strategy is also to create a Polish branch of hydrogen economy, amongst other ways by developing and making use of national patents and hydrogen technologies. The Strategy emphasises the need to use Polish research and development potential in the area of hydrogen technologies and to become a supplier of electrolysers, pyrolysis installation, fuel cells and hydrogen storage tanks, reactors and catalysts for methanation (Power to Gas or “P2G”), or for Power to Liquid (“P2L”) technologies and other components.
The authors of the Strategy are of the opinion that implementing the above assumptions requires planning legal solutions supporting the development of hydrogen use. It is crucial to support demand, and specifically to create appropriate technical conditions and incentives for companies, as well as to secure the financing of hydrogen technologies from the EU leverage package, which will contribute to their further development.
As was mentioned above, the goals formulated in the Strategy relate to three priority areas of using hydrogen: energy, transportation, and industry, as well as its production and distribution, and the need to establish a stable regulatory environment.
The Strategy also assumes the development of a broad range of competence for the hydrogen economy. The main task within that scope is to prepare qualified personnel to create, construct, and operate hydrogen installations. The projected dynamic growth of hydrogen mobility should take place in parallel with educating personnel skilled for maintaining such vehicles and refuelling stations. The Strategy also emphasised that the hydrogen economy growth creates a possibility for employees from coal-based sectors to effectively change their qualifications. To this end, it will be necessary to commence educational activities, which will make it possible to increase social awareness of the fact that structural changes of the labour market do not entail only the liquidation of positions but also the creation of new jobs. Therefore, the Strategy anticipates that the Government should undertake actions and be involved in social campaigns sharing knowledge on the current hydrogen use and the security rules that should accompany such hydrogen use.
Energy and industry
As specified in the Strategy, the application of hydrogen technologies in the energy sector needs to be commenced in the context of an increasing share of non-controlled electric energy from RES in the Polish energy mix. Under the draft Energy Policy of Poland until 2040, the share of RES in the net electric energy production will reach at least 32 per cent in 2030. A significant portion of generation capacity from renewable energy installed in Poland is based on sources whose operation profile depends on weather conditions (wind, sun, partially water) and which operate for an insignificant number of hours a year.
The actions planned in the Strategy for the forthcoming five years, which are meant to support the performance of that objective, include the need to support the stable operation of distribution grids, including commissioning class 1 MW P2G installations based on Polish technologies, determining the legal framework for hydrogen technology operation, support for research and development in relation to the creation of co- and poly-generation systems for the construction of demonstration installations. Studies also are envisaged in relation to the development of the hydrogen storage methods, including the possibilities of making use of large-scale salt caverns. Subsequently, the plans to be implemented by 2030 envisage the commissioning of medium-sized co- and poly-generation installations with hydrogen being the main fuel, commencing the use of hydrogen as energy storage capacity, and the installation of fuel cell systems.
The year 2030 is also a year for which the use of hydrogen as energy capacity storage is scheduled to commence with a view to supporting the operation of the RES-based energy grid. By 2030, favourable conditions should be created for establishing installations throughout the country that use fuel cells for blocks of flats, small housing estates and public buildings, which installations may also serve as a source of emergency energy supplies.
The Strategy proposed supporting actions aimed at obtaining and using low-carbon hydrogen for industrial production processes. Using low-carbon hydrogen will make it possible to significantly reduce the greenhouse gas emission within that branch of the economy in which achieving the climate neutrality is the most difficult.
The Strategy assumes that heavy industry could observe the highest increase in the consumption of low-carbon hydrogen. According to the forecasts, electrolysis using RES, with natural gas prices as high as in Europe, will achieve a cost parity for certain products and processes after 2030.
Therefore, actions designed in the Strategy to achieve this objective include: providing support until 2025 in respect of initiatives related to obtaining and using low-carbon hydrogen in petrochemical production processes, implementing a coal contract of differences as an instrument supporting climate transformation in industry, the development of technologies consisting in the production of steel in the process of its original melting process, financial and organisational support for feasibility studies of industrial hydrogen valleys as part of creating circular industrial processes.
In turn, it is envisaged that by 2030 at least five hydrogen valleys with a significant element of hydrogen transmission infrastructure in the form of pipelines will have been constructed.
Hydrogen for transport is a cornerstone of Poland’s hydrogen economy. There is wide ranging interest within the Polish industry around the development of hydrogen transportation infrastructure, such as refuelling stations for hydrogen fuelled vehicles. One example is PKN ORLEN’s focus on developing hydrogen generation and distribution installations of hydrogen fuel for this purpose. Furthermore, state funding is available to encourage individuals to purchase hydrogen fuelled vehicles. The Strategy of Sustainable Development of Transport for 2030 predicts that low emission transport, including technologies such as hydrogen, will be key in addressing the negative impact on the environment.
A number of local companies have begun developing hydrogen refuelling stations. These include the state-owned energy companies PKN ORLEN, PGNiG and LOTOS, who are planning to develop a network of hydrogen vehicle refuelling stations by 2021. PKN ORLEN’s first refuelling station for hydrogen-fuelled vehicles shall be open in 2021.
PKN ORLEN is also planning to develop a hydrogen hub, with hydrogen generation installations located in Włocławek, in 2021, and in Płock at a future date. PKN ORLEN has signed a Letter of Intent (“LOI”) with Pojazdy Szynowe PESA Bydgoszcz S.A. – the largest manufacturer of railway vehicles in Poland – for the construction of a hydrogen fuelled train. Furthermore, PKP Cargo S.A. – the largest rail freight operator in Poland and the second in the EU – has also signed a LOI with JSW concerning joint initiatives for the commercial use of the hydrogen as a fuel.
In relation to buses, Solaris Bus & Coach S.A. – one of the leading European bus manufacturers – is currently producing a fleet of hydrogen fuelled buses.
Therefore, the Strategy envisages that the potential of hydrogen includes replacing conventional fuels, specifically in municipal/public transport, road, railroad or sea/maritime transport, and subsequently also in aviation (also unmanned aircraft aviation).
To totally decarbonise that branch, it will be necessary to implement fuel cell electric vehicles (“FCEVs”). FCEVs will be of special importance in the scope of public transport, as well as heavy goods and long-distance road transportation.
The Strategy assumes increasing use of hydrogen as an alternative fuel in transportation, precisely thanks to the significant advantages of FCEVs, including the fact that they can cover long distances without the need to refuel (more than 500 kilometres). In line with the Strategy’s assumptions, FCEVs will play a special role in the process of decarbonising public transportation in the future, as well as heavy goods and long-distance road transportation, where there is a limited possibility of using electric vehicles.
Therefore, in the perspective of the next five years, the Strategy assumes the creation of conditions in which 500 hydrogen-driven buses manufactured in Poland will be admitted to operation, as well as 32 hydrogen refuelling stations and hydrogen cleaning installations will be constructed. The plans also include the construction of the first hydrogen-driven passenger trains/freight locomotives which will replace their combustion equivalents at railway lines which cannot be easily electrified. The projections also include the examination of the possibility and profitability of the application of hydrogen in transporting synthetic gas produced through hydrogen methanation and launching pilot programmes related to using hydrogen in heavy goods road, railroad, sea and inland/river transport.
In a 10-year perspective, the Strategy assumes that the number of hydrogen-driven buses in operation will increase to 2000, and that the refuelling infrastructure and hydrogen cleaning installations will be further developed. The forecasts state that diesel trains will be replaced with hydrogen trains and that the use of hydrogen in heavy goods transport, railroad, sea, and inland/river transport will grow. Within the same perspective, work is envisaged to produce synthetic fuels in the reaction of hydrogen with CO, CO2, N2. It is also planned to further increase the use of hydrogen in heavy goods road, railroad, sea, and inland/river transport.
Energy system management and hydrogen transmission
According to the Strategy, it will be necessary to create, by 2030, conditions for commissioning installations for producing hydrogen from low- or zero-carbon emission sources, as the majority of hydrogen in Poland is currently produced from fossil fuels. The above choice is not meant to discriminate the existing production methods but is aimed at encouraging Polish industry towards a low-carbon economy transformation.
To this end in line with the Strategy – within the next five years, activities will be undertaken with a view to commissioning the installation for hydrogen production from low-carbon sources, amongst others by electrolysis, from biomethane, waste gas, natural gas with CCS/CCU, by pyrolysis, and other alternative technologies of hydrogen production, as well as commissioning synthetic gas production in the process of hydrogen methanation.
By 2030, it is projected that the capacity installed in RES will be used for the production of hydrogen and synthetic fuels by electrolysis. The installed capacity of electrolysers will then reach 2 GW, which will enable the generation of approximately 6,415 GWh, i.e. 193,643 tonnes of hydrogen annually, which represents approximately 20 per cent of the existing total hydrogen production in Poland.
The plan to be realised by 2030 also encompasses securing conditions for constructing installations in Poland for hydrogen production at nuclear power plants.
The Strategy emphasises that in order for the economy based on hydrogen to develop, it is necessary to efficiently supply it from the production place to its end recipient and its secure storage. Therefore, a gradual development of the hydrogen transmission and distribution grid is proposed. The existing solutions relating to hydrogen transportation provide for pipelines, road and railroad transportation, and it is expected in the future that network will be expanded to include oceanic transportation.
It has not yet been confirmed, under Polish conditions, whether electric energy transmission proves to be more efficient so that hydrogen is produced from it near the demand centres, or whether transmission of hydrogen generated at RES installations or of synthetic natural gas (“SNG”) produced from it by the existing gas grid is regarded as more efficient. The possibility of transmitting hydrogen by dedicated pipelines also needs to be considered. In the perspective of the first five years, it is also necessary to examine the existing gas infrastructure in relation to possible hydrogen feeding and transmitting mixes of hydrogen and gas.
Therefore, in the perspective outlined up to the year 2025, it is assumed that actions will be taken based on the analyses carried out, through:
- The development of the hydrogen transmission and distribution grids, whether by transmitting electric energy, transmitting hydrogen/SNG by the existing gas grid or by transmitting hydrogen by dedicated pipelines;
- the preparation of a feasibility study in respect of the north-south pipeline and the establishment of the so-called “Hydrogen Highway”,
- and examining the existing gas infrastructure from the perspective of the possible hydrogen feeding and transmitting mixes of hydrogen and gas.
The plan of actions to be completed by 2030 stipulates adjusting selected sections of gas grid for transmission and distribution of gas doped hydrogen, constructing dedicated pipelines for hydrogen transmission and distribution or expanding the electric energy grid to transmit electric energy and feeding SNG produced in P2G systems into gas grids.