Italy, Austria, Germany, Algeria, and Tunisia reiterated on Tuesday their intention to develop a pipeline that would carry renewable hydrogen from North Africa to Europe, the Italian energy ministry said.

The 3,300-km (2,050 miles) hydrogen pipeline, named SouthH2 Corridor, is planned to ship green hydrogen from the African coast to Italy and then further north to Austria and Germany.

Ministers and officials from the countries and Ditte Juul Jørgensen, Director-General for Energy of the European Commission, attended the meetings and discussions for the project.

SouthH2 Corridor is recognized as a Project of Common Interest (PCI) by the European Commission, which means that the EU could finance parts of the infrastructure project.

The project will use more than 65% repurposed infrastructure, with new pipeline segments where necessary. The corridor has political endorsement, as well as strong support from companies involved in production and offtake of hydrogen along the whole corridor.

The project is expected to come on stream in 2030.

SouthH2 Corridor will further boost Italy’s role as a European energy hub, said Antonio Tajani, Italy’s Deputy Prime Minister and Minister of Foreign Affairs.

Green hydrogen projects in Europe have seen setbacks in recent months, amid persistently high costs and uncertainty about future demand.

Denmark, for example, looks to commission a cross-border green hydrogen pipeline to Germany in 2031, three years later than the previous timeline, the Danish government said in October.

Shell and Equinor have ditched plans for low-carbon hydrogen production and transportation in north Europe, due to a lack of demand.

Green hydrogen will struggle to compete at price level with gray hydrogen made from natural gas at least until 2050—much longer than previously anticipated, research firm BloombergNEF said last month.

BNEF’s new report on hydrogen prices finds that green hydrogen, the one produced via electrolysis using renewable energy, will fail to reach price parity with gray hydrogen by the middle of the century, as costs have more than tripled from the 2023 forecast.

By Charles Kennedy for Oilprice.com

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