EBRD and Ukraine boost low-carbon hydrogen development

By Vanora Bennett

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  • EBRD and Ukraine joining forces to promote development of hydrogen in the country
  • Hydrogen can reduce reliance on fossil fuels
  • New EBRD study assesses potential for hydrogen supply chain across Bank’s regions

The European Bank for Reconstruction and Development (EBRD) and the Gas Transmission System Operator of Ukraine (GTSOU) are joining forces to promote the development and use of hydrogen in Ukraine.

The partners have signed an agreement to formalise their cooperation on low-carbon hydrogen and to develop hydrogen supply chains, a first of its kind accord.

The EBRD and GTSOU previously signed a Memorandum of Understanding in April 2020 that would provide a general framework to improve the environment for sustainable energy investments in Ukraine and reduce the level of greenhouse gas emissions, in particular methane fugitive emissions, and air pollution.

The EBRD regions are characterised by a growing renewable energy industry, which is expected to continue adding value to the domestic economies and contribute to green transition. In certain countries, recent renewable energy electricity prices have fallen below US$ 30/MWh – a level at which production of green hydrogen starts to become competitive with conventional fossil fuels.

The Bank recently launched a study on the potential for developing different segments of the hydrogen supply chain across many of the economies where it invests, including Ukraine.

Harry Boyd-Carpenter, EBRD Managing Director, Green Economy and Climate Action, said: “I am very pleased that the EBRD and GTSOU are cooperating to support each other’s activities regarding hydrogen. Ukraine relies heavily on fossil fuels across all sectors of its economy and hydrogen can represent a good alternative for decarbonisation, and reduce reliance on fossil fuels. Supporting the green transition of our economies is a key priority for the EBRD.”

Sergiy Makogon, CEO of GTSOU, said: “Hydrogen is one of the most promising energy sources, which will contribute significantly to energy decarbonisation and achieving sustainable development goals. The challenge therefore is to develop technology to scale up hydrogen use, to create the necessary conditions and infrastructure for its production, transportation and consumption. All this requires time, effort and cooperation by all stakeholders. We recognise the role of natural gas as one of the key energy sources and transition fuel on the path to carbon-free economy, which will remain significant for this transition period. As the operator of the gas transmission system, our task is now to prepare our infrastructure for the decarbonised energy markets of the future.”

“Green” hydrogen – made through the electrolysis of water powered by renewable energy – is widely seen as a promising clean fuel as it has no carbon footprint. In early July, the European Union put scaling up green hydrogen at the centre of Europe’s climate ambition, announcing plans to produce up to a million tonnes of the gas through facilities to be built in the next four years.  

To date, the EBRD has invested nearly €15 billion in close to 500 projects in Ukraine. Work is focused on assisting the country’s stabilisation and anchoring its reforms by increasing energy efficiency and energy security, unlocking agricultural and industrial potential, providing quality infrastructure and strengthening the financial sector.

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