Algeria, Tunisia, Austria, Germany and Italy have agreed to construct a hydrogen pipeline to bring clean fuel generated with renewable energy in North Africa to the European Union, in a move hailed as one of the bloc’s “most important renewable energy projects”.
But analysis of Algeria and Tunisia’s green hydrogen strategies reveals that neither country is likely to be in a position to export the fuel in any meaningful quantity when the pipeline is due to start operating in 2030.
Experts told Climate Home News that despite the hydrogen hype, there are serious challenges for North Africa to become a major exporter of green hydrogen to the EU by 2030. Some question whether the pipeline should be developed at all.
Last week, ministers from each country along with Tunisia’s ambassador to Italy met in Rome where they confirmed their intentions to build the SoutH2 Corridor.
The first-of-its kind hydrogen pipeline, 3,500-4,000 kilometres long, would run under the Mediterranean Sea. It aims to connect hydrogen production centres in Algeria and Tunisia – which have yet to be built – to the Italian island of Sicily and consumer hubs in Austria and Germany by repurposing existing gas infrastructure along 65% of the route.
The corridor “is crucial for the development of an interconnected and diversified hydrogen backbone” in the EU, the consortium of European and Algerian companies developing the project says on its website.
Green hydrogen ramp-up
The EU is betting on importing large amounts of green hydrogen to wean highly polluting sectors and hard-to-electrify industries such as steel production, fertilisers and long-distance transport off climate-wrecking fossil fuels.
With its abundant sunshine, vast renewable energy potential and relative proximity to Europe, EU officials hope to tap into North Africa’s resources and secure green hydrogen supplies.
“The Southern Hydrogen Corridor is one of the largest and most important renewable energy projects of our time,” Philipp Nimmermann, Germany’s State Secretary for the Ministry for Economic Affairs and Climate Action, said in a statement.
“We can use North Africa’s immense potential for renewable energies, advance the hydrogen ramp-up in Germany and support the EU’s climate targets,” he added.
According to the project consortium, the pipeline, when fully operational, could deliver more than 40% of the EU’s target to import 10 million tonnes of green hydrogen by 2030.
But Algeria and Tunisia anticipate large-scale green hydrogen production to be at least a decade away, calling into question plans for exports in the next five years.
Adrian Odenweller, a researcher at the Potsdam Institute for Climate Impact Research (PIK), told Climate Home that the EU should “certainly not count on the delivery” of green hydrogen from Algeria and Tunisia any time soon.
Odenweller said he does “not expect to see any hydrogen imports via [the SoutH2 Corridor] by the year 2030” and urged policy makers to interpret project announcements “with caution”.
“Green hydrogen production projects have a poor track record and often get delayed. I would expect this to be even worse for massive infrastructure projects such as pipelines that require international coordination,” he said.
Mismatched expectations
Green hydrogen is produced by splitting water into hydrogen and oxygen using renewable electricity – as opposed to blue or grey hydrogen, which uses gas.
But transporting green hydrogen is a logistical challenge. Channelling it in a gaseous form through a pipeline is generally cheaper and more efficient that liquefying it to transport it on ships but requires relative proximity to where the fuel is consumed.
Algeria and Tunisia do not currently produce green hydrogen. Algeria – a top gas exporter – and Tunisia generate nearly all of their electricity from gas. The share of solar power in electricity generation is growing but accounted for less than 1% in Algeria in 2023 and 4% in Tunisia the same year, according to BloombergNEF data.
Over the last two years, both countries have released green hydrogen strategies. But neither country foresees large-scale hydrogen production until the mid-2030s.
By 2030, the SouthH2 Corridor will have capacity to import 4 million tonnes of hydrogen per year into the EU. But Algeria and Tunisia expect to have combined capacity to export around 330,000 tonnes of hydrogen – or 8% of the pipeline’s capacity – by then.
Algeria’s hydrogen strategy suggests it could produce around 30,700 tonnes of green hydrogen by 2030. The country foresees production of more than 1 million tonnes from 2040. Tunisia plans to export 300,000 tonnes of green hydrogen to the EU by 2030 and 1.6 million tonnes by 2040.
Neither the Algerian nor Tunisian governments responded to requests for comment.
‘Reality check’
According to data from the International Energy Agency (IEA), less than 1% of the 97 million tonnes of hydrogen produced globally in 2023 was green or “low emissions” hydrogen.
Growth in the sector has been slow, with many projects struggling to move beyond very early stages of development. The IEA recently found that investments in electrolysers and green hydrogen have lagged because of uncertainty over costs, demand and regulatory frameworks.
A recent paper published in Nature Energy by PIK found a “huge gap between [hydrogen] announcements and actual deployment”. They tracked almost 200 projects over three years and determined that only 7% of the capacity announced was completed on schedule.
In 2024, the EU’s own auditors called for “a reality check” on its green hydrogen production and import targets, describing them as “overly ambitious”. But the EU Commission said it stood by the targets despite the challenges. The Commission declined to respond to Climate Home’s questions on the SoutH2 Corridor.
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Abdurahman Alsulaiman, from the Oxford Institute for Energy Studies, argued that the EU’s hydrogen import target is “highly ambitious” but underpinned by a sound political calculation.
“As more details about financial support, trade economics, and standardisation become available to investors, the target will become more of a reality rather than just an ambition,” he told Climate Home. It is also placing “urgency “ on potential production hubs such as North Africa even though “the economics of the green hydrogen trade are still at a very nascent stage”, he added.
Diverting energy and water away from needs
But others have questioned whether Algeria and Tunisia should use clean electricity to produce hydrogen for export rather than to meet their own energy needs.
“Instead of planning to export green hydrogen to Europe, North African countries should focus on using domestically produced hydrogen to decarbonise their own high energy-intensive industries or increasing their share of renewables in power generation,” Ana Maria Jaller-Makarewicz, of the Institute for Energy Economics and Financial Analysis, told Climate Home.
Tunisia already struggles with energy shortages and is dependent on gas and electricity imports from Algeria to meet its growing electricity needs, said Saber Ammar, a Tunisian researcher at the Amsterdam-based Transnational Institute think-tank.
The EU is pushing for a green hydrogen economy because “they dominate the [hydrogen] value chains and technologies” and can outsource all “the socio-environmental costs to the peripheries”, he said.
Using scarce renewable electricity and even scarcer water resources to produce green hydrogen for Europe “is not only a paradoxical and foolish investment but it also underscores the political hegemony at play”, he added.
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Drought-stricken Tunisia and Algeria are already experiencing water shortages and climate change is likely to exacerbate water scarcity in the region.
Former Algerian parliamentarian Nadjib Drouiche, a senior researcher in desalination and water policy, supports Algeria’s move to become a hydrogen-exporting nation.
However, North Africa’s “water scarcity, exacerbated by climate change, necessitates a cautious approach,” he told Climate Home.
“Prioritising domestic water needs, implementing sustainable water management strategies like efficient desalination, wastewater reuse and water conservation… are crucial before large-scale green hydrogen production for export can be considered,” he emphasised.
(Reporting by Sacha Shaw; editing by Chloé Farand)
The post EU backs North Africa hydrogen pipeline, but is it a green dream? appeared first on Climate Home News.
EU backs North Africa hydrogen pipeline, but is it a green dream?
The right-wing populist Hungarian government led by Viktor Orbán has suffered a landslide electoral defeat to the centre-right Tisza party, led by Péter Magyar.
This brings to an end 16 years of rule by Orbán and his Fidesz party, a move welcomed by many around the world who were concerned about Hungary’s “slide toward authoritarianism”.
Hungary has played a disproportionate role in EU climate and energy policy in recent years, by repeatedly vetoing climate action and by delaying the phaseout of Russian fossil-fuel imports.
Magyar did not prioritise climate and energy issues in his electoral campaign, but he has championed cooperation with the EU and proposed a 2035 deadline for “eliminating Russian energy dependence”.
Hungarian experts tell Carbon Brief that, while the new government is yet to be formed, it is likely that Magyar will move quickly to secure EU funds for “green” measures.
One expert notes that “this is not a progressive pivot”, with Hungary unlikely to emerge as a climate leader in the EU, even if it is less disruptive to the bloc’s wider climate strategy.
- What was Orbán’s approach to climate action?
- What will be the new Hungarian government’s climate and energy policies?
- How will the new government approach EU climate policy?
- What has the new leadership said about Russian fossil fuels?
What was Orbán’s approach to climate action?
Hungary has had a mixed record on climate change under then prime minister Orbán, supporting some relevant actions while opposing others – particularly those taken at an EU level. This broadly reflects his Fidesz party’s populist and Eurosceptic leanings.
Orbán has described the EU’s climate goals as a “utopian fantasy” that would “destroy the middle class”. He has also accused “western elites” of wanting people to “live in fear” of climate change.
Yet, despite being embraced by climate sceptics elsewhere and supporting climate-sceptic lobbyists, Orbán’s government has not overtly adopted such sceptical rhetoric.
In fact, reflecting broad Hungarian support for climate action, Orbán has framed his nation as a “climate champion” – albeit one taking a “pragmatic” approach. This was captured in his speech at the COP29 summit in 2024, when he said:
“We must continue advancing the green transition, while also maintaining our use of natural gas, oil and nuclear energy…Our climate policy should be guided by careful consideration and common sense, not by ideology, alarmism or panic.”
Domestically, Orbán’s government has pursued various climate goals, including a 2050 net-zero target, phasing out coal power by 2029 and supporting the expansion of solar power.
What will be the new Hungarian government’s climate and energy policies?
Climate change was not a major issue in the April election and Magyar, the incoming prime minister, hardly mentioned it in his campaign.
However, the 243-page manifesto released by his Tisza party includes many climate-related proposals, such as home insulation, railway electrification and tackling drought.
The document says some of these measures – notably “energy modernisation and efficiency programmes” – will be funded with billions of euros in EU funds that have been frozen under Orbán. (See: How will the new government approach EU climate policy?)
One notable pledge is to “double the share of renewable energy in domestic energy supply” by 2040. As the chart below shows, Hungary already generates three-quarters of its electricity from clean sources – predominantly Paks, its single nuclear power plant.
Nearly a third of Hungary’s electricity comes from solar, which has benefited from supportive government schemes in recent years. In contrast, for years, the Orbán government blocked the construction of wind turbines, meaning there is virtually no wind power in Hungary.
The Tisza manifesto recognises this imbalance, stating that “we will abolish the unnecessary restrictions preventing the installation of new wind turbines”, while also supporting geothermal energy.
Energy prices are a key political issue in Hungary, as they are in many nations around the world. Orbán’s “utility cost reduction” has been a flagship policy for many years, capping household prices using large state subsidies.
During the election, Orbán accused his opponent of planning to get rid of the energy price cap. In fact, the Tizsa manifesto says the new government will “maintain and expand” the scheme and add new VAT cuts on firewood.
Despite having few batteries and electric vehicles (EVs) domestically, Hungary has emerged in recent years as a major battery manufacturer, driven by Chinese and South Korean investment. However, this boom has sparked environmental and social concerns.
Zsolt Lengyel, founder and chair of the Institute for European Energy and Climate Policy (IEECP), tells Carbon Brief:
“Orbán’s battery and EV strategy – in theory, a flagship of the transition – has backfired politically…So Tisza inherits a paradox: it needs to accelerate the transition, but does so in an environment where parts of that transition have already lost public legitimacy.”
With much still unknown about Magyar’s attitude to climate and energy policy, some Hungarian experts that Carbon Brief spoke to cautioned against “speculation” and “wishful thinking” when assessing his climate credentials.
How will the new government approach EU climate policy?
There is cautious optimism among EU officials and leaders that a Hungarian government led by Magyar will be more cooperative on EU-led initiatives.
Under Orbán, Hungary has been a vocal and persistent opponent of EU climate policies.
Since 2011, 21 of all the 48 vetoes on joint EU actions have been used by Hungary. These include blocking efforts to sanction Russia following the country’s invasion of Ukraine. (See: What has the new leadership said about Russian fossil fuels?)
Among other issues, Hungary has vetoed or obstructed progress on the EU’s 2050 net-zero target, the “fit for 55” legislative package to help meet that goal and the 2035 ban on petrol and diesel cars.
Generally, this opposition did not totally block these policies, as most did not require unanimous agreement among EU member states. However, it did tend to slow down or complicate the process. Hungary was also not acting alone – it was often joined by fellow eastern and central European states, claiming the policies would have high costs.
Nevertheless, the Orbán government’s aversion to the EU has taken it further than other states. In recent months, for example, Hungary has launched a legal case against the EU over its phaseout plan for Russian oil and gas imports.
In this context, Lengyel tells Carbon Brief:
“Orbán’s exit removes Hungary’s most damaging feature in EU climate politics: the ideological reflex to oppose ‘anything Brussels does’.”
However, just because Magyar is less hostile to the EU does not mean his government will be a climate leader.
Magyar’s centre-right Tisza party is aligned with the European People’s Party (EPP) grouping in the European parliament, which has been instrumental in weakening EU climate goals in recent months. Given this, Lengyel tells Carbon Brief.
“Let’s be clear: this is not a progressive pivot. Tisza sits close to the EPP mainstream and is unlikely to challenge it. If anything, it will follow it, including on any watering down of green-deal elements.”
Crucially, Hungary is entitled to billions of euros of EU funds that have been blocked due to breaches of conditions regarding the rule of law and human rights under Orbán.
These include €9.5bn for Hungary’s recovery and resilience plan, the EU’s post-Covid recovery fund, much of which is earmarked for the “green transition”.
This finance needs to be disbursed before the end of August – and both Magyar and the EU have been clear that unlocking the funds is a priority.
Jozsef Feiler, director of the south-east Europe and Hungary programme at the European Climate Foundation, which funds Carbon Brief, says “full EU compliance” will be crucial for Hungary over the coming months, in order to obtain these funds. He tells Carbon Brief:
“The economic and financial stability of the new government [will depend] on obtaining the recovery and resilience facility funds and managing some kind of absorption before the 26 August hard deadline.”
Another early challenge will be the new government’s approach to the new part of the EU’s emissions trading scheme (ETS) – known as ETS2 – which will put a price on emissions from buildings, cars and other sources not covered in the original ETS.
ETS2 is already facing criticism from member states concerned about rising fuel costs. Moreover, Hungary is likely to be one of the countries that is most exposed to high fossil-fuel prices.
István Bart, a senior director in carbon pricing at the Environmental Defence Fund, tells Carbon Brief that Orbán’s government has done little to help with the implementation of ETS2, which is currently due to start in 2028. He notes that, with the question of affordability so fraught in Hungary, it is unclear how Magyar will tackle this issue.
What has the new leadership said about Russian fossil fuels?
One of the most notable policy statements made in Tisza’s manifesto is a commitment that:
“By 2035, we will eliminate Russian energy dependence and diversify our domestic energy supply.”
Despite its relatively clean electricity supply, Hungary is still heavily reliant on fossil fuels – including in its transport, heating and industrial sectors – the majority of which are imported.
Russia is Hungary’s main fossil-fuel trading partner, with the Druzhba and TurkStream pipelines supplying much of the smaller nation’s needs for oil and gas, respectively.
Among EU member states, Hungary is second only to Slovakia in terms of reliance on Russian fossil fuels. In 2024, 74% of Hungary’s gas and 48% of its oil were imported from Russia, as shown in the chart below.
Since Russia’s full-scale invasion of Ukraine in 2022, most EU nations have taken steps to reduce their dependence on Russian fossil fuels.
The EU has implemented a series of sanctions on Russia and the European Commission launched the REPowerEU plan to “fully end dependency on Russian energy”.
Under Orbán, however, Hungary has obstructed efforts to wean the EU off Russian fossil fuels, citing energy-security concerns. It has successfully negotiated exemptions from Russian oil sanctions, allowing the country to increase its reliance on cheap Russian crude.
The REPowerEU regulation involves a ban on Russian pipeline gas by September 2027. Unlike sanctions, the EU did not need unanimity among states to pass this.
It is notable that Tisza has only committed to end reliance on Russian energy by 2035 – eight years after the EU deadline. It is unclear how Magyar’s new government will negotiate this discrepancy, especially given long-term contracts with Russian suppliers.
Hungary also relies on Russia for nuclear technology and supplies of uranium for its nuclear plant. In its manifesto, Tisza says it will explore the possibility of sourcing nuclear fuel from US or French suppliers, as well as building small modular reactors.
Orbán had already started pursuing diversified nuclear and fossil-fuel supplies by buying from the US, even as it secured exemptions from US sanctions on Russian energy imports. It is possible that Tisza may maintain this approach.
However, with the Iran war and energy crisis looming in recent months, Bart, from EDF, tells Carbon Brief:
“Before the Iran war started, you could have said: ‘Why don’t you just buy LNG [liquified natural gas]?’…Now it seems like less of an option, so, unfortunately, in the short term, [Russian gas] has to stay because we don’t really have an alternative.”
The post Q&A: What Magyar’s defeat of Orbán in Hungary means for climate and energy appeared first on Carbon Brief.
Q&A: What Magyar’s defeat of Orbán in Hungary means for climate and energy
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