U.S. prepares hydrogen deal before Merkel, Zelensky visits

The U.S. government is preparing a framework for
Ukrainian hydrogen exports to Germany in time for visits in July by German
chancellor Angela Merkel and Ukrainian president Volodymyr Zelensky. The proposal
would include using Ukraine’s existing gas transit system to transport the
hydrogen fuel to western Europe. Bloomberg.com reported on June 26 that
progress on the talks ahead of offering the proposal is uncertain, with sources
claiming various degrees of success.

The European Investment Bank (EIB) and Ukraine’s
energy ministry discussed the development of green hydrogen energy in Ukraine
on June 23. The ead of the EIB Representation in Ukraine, Jean-Eric de Zagon,
said that working on green hydrogen projects with the energy ministry was of
interest to the EIB.

James Hydzik: The
Americans’ plan of pushing for the development of green hydrogen exports from
Ukraine should be welcomed. It will be hard for any German interest to openly
fight against the further introduction of a more ecological fuel, especially if
the Green Party wins the German elections in September. EIB support means that
financing should be relatively easy to come by.

However, a variety of interests could work against
the deal, ranging from pro-gas to pro-Russian to those seeing that Germany
should build its own hydrogen production capacity. Behind all that, though, is
the possibility that complacency will set in once the proposed solution is
adopted. Policy and regulatory changes might rile vested interests that the
government would sooner not disturb, or they could just drag on. If the deal is
worked out, it will be vital to securing environmental and political interests,
but it won’t guarantee that the work afterward will be done.