Project

Germany's deep decarbonisation scenarios indicate that achieving climate neutrality by mid-century will largely depend on energy efficiency and the use of renewable energy sources. However, these scenarios also highlight that hydrogen and synthetic fuels will be crucial for reducing emissions beyond 80%. Due to the limited potential for renewable energy generation in Germany, a significant portion of the necessary hydrogen will need to be imported. Algeria is a promising partner for establishing a hydrogen partnership with Germany, thanks to its excellent conditions for renewable power generation and robust logistical infrastructure, including around 15 ports, an extensive gas grid, and numerous refineries and chemical plants. The deployment of renewable energy and PtX technologies offers enormous potential for the Algerian economy by supporting the transition from the current use of natural gas and oil resources by providing opportunities for economic and social development (investment, jobs, new markets). The formation of a German-Algerian hydrogen partnership could therefore be mutually beneficial, but requires compliance with strict sustainability criteria to ensure that the creation of export markets develops in line with the decarbonisation of the Algerian economy.

The study commissioned by KfW, titled "Assessment and Analysis of the Power-to-X Market and Investment Opportunities in Algeria" investigated the opportunities for Algeria along the value chain of different PtX technologies. The study serves as the basis to initiate concrete programmes in the framework of the German-Algerian Financial Cooperation with the Algerian Ministry of Energy and Mining (MEM) and under the responsibility of the German Federal Ministry for Economic Development and Cooperation BMZ on the German side. The primary focus was on identifying investment opportunities, particularly in hydrogen production facilities and related Power-to-X infrastructures. To achieve a comprehensive understanding, the study employed several methods, including:

Methods

• Renewable energy resource assessment
• Analysis of green hydrogen production potentials
• Production site identification
• Cost calculations for hydrogen production (including synthesis products) and transport
• Development of decarbonisation scenarios for the Algerian economy
• Sustainability assessment of hydrogen/PtX production
• Stakeholder interviews and workshops
• Identification of investment opportunities

• Eichhammer, W.; Müller, V. P.; Hadrich, M. J.; Riemer, M.; Boie, I. (2024): Assessment and Analysis of the Power-to-X market and investment opportunities in Algeria. Final project report. Karlsruhe/Freiburg: Fraunhofer Institute for Systems and Innovation Research ISI/Fraunhofer Institute for Solar Energy Systems ISE.
• Eichhammer, W.; Müller, V.P.; Hadrich, M.J.; Riemer, M.; Boie, I. (2024): Évaluation et analyse du marché Power-to-X et des opportunités d'investissement en Algérie. Rapport final du projet. Karlsruhe/Freiburg: Fraunhofer Institute for Systems and Innovation Research ISI/Fraunhofer Institute for Solar Energy Systems ISE.
• Eichhammer, W. (2024): Étude Évaluation et Analyse du Marché du Power-to-X et des Opportunités d'Investissement en Algérie. Atelier de Clôture, 18 Avril 2024. Karlsruhe: Fraunhofer Institute for Systems and Innovation Research ISI.
• Müller, V. P.; Eichhammer, W.; van Vuuren, D. (2024): Paving the way: Analysing energy transition pathways and green hydrogen exports in developing countries – The case of Algeria. In: International Journal of Hydrogen Energy, 67, pp. 240–250. https://doi.org/10.1016/j.ijhydene.2024.04.153.

April 2021 - June 2024.

• The work was commissioned by KfW.

• Fraunhofer ISE.