EU is ready with a green recovery plan. Here is how to make smart investments in Power-to-X
The European Union just launched their biggest ever financial recovery plan to help European economies and businesses regain their strength in the wake of COVID-19. Out of the 750 billion Euros in the recovery fund, 37% is earmarked for investments in the green transition. A smart move would be to spend some of it on Power-to-X projects. But what should the focus be? Here is our take.
1: Use our strength position: Invest in applied research
First of all, we need heavy investments in applied research within Power-to-X, and Denmark has a unique strength position here. We have the needed competencies within sustainable energy, we have world-class scientists, and we already have a functioning value chain in hydrogen and Power-to-X.
GreenLab is a national research facility for green technologies, and we have strong collaborations with DTU, Aarhus University, and Aalborg University. In our view, the greatest potential lies in research projects that are established as collaborations between industries, the transport sector, and universities. EU funding would be well spent here.
2: Focus on largescale testing and production
If PtX is to truly solve the problems we face, we need to think in largescale testing and production from the beginning. There is no use in being able to solve a problem at a theoretical level if we cannot transform it to largescale testing first and largescale production later. GreenLab’s CEO, Christopher Sorensen, says: “PtX represents a potential export adventure for Denmark, that resembles the wind adventure many years ago. But it will only happen, if we dare to think big from the start”.
3. Think about the buyers – create a market
Green technology is nothing without companies willing to purchase it. We need to invest in creating the very market for PtX. Relevant industries and sectors must be involved in the development, so everyone is on the same page when the technology is ready for implementation.
But great technology is only half the story. The other half is creating the right incentives to use that technology. A series of instruments are available for this – we need to implement EU’s directive for sustainable energy (RED II) and drive digitalization of how we control energy through for instance blockchain or crypto energy. Fortunately, digitalization is the other focus of the recovery fund.
“Another aspect of the market creation is to make Power-to-X accessible and easy to choose for as many as possible”, says Christopher Sorensen.
“GreenLab stands out because we have focused our business model on making it as cheap and easy as possible to run a green business in our industrial park. We call it ”Facilities as a Service” or FaaS, and it is a model where we operate as an industrial community and thus get easier access to green power and other operational advantages – whether you produce hydrogen or protein powder from starfish. I think the idea of collaborating in new ways is also something we need to invest in as a society, and I look forward to seeing the EU fund projects that do just that.”
Think beyond PtX
PtX is an important part of the solution to ensure CO2-neutrality in industries and heavy transport. But the task of reducing Europe’s emissions with 55% by 2030 will take bigger and more groundbreaking solutions than PtX alone. The society of the future must be based on a model of circular economy where we don’t use any resources without making sure that they are reusable.
Christopher Sorensen says: “At GreenLab we have developed an integrated system – the SymbiosisNet – which makes it possible for the companies in our green industrial park to share their excess energy with each other, so they achieve 100% sustainable production – and we have the cloud solution that keeps everything running too.
In our view, the circular aspect is key for the green transition. PtX is part of the solution but a coherent energy system is the joker that can really make a transition happen”.
Facts
- In order to help the economies and businesses that are struggling after the corona crisis, EU has approved a recovery fund of 750 billion Euros
- The fund’s strategic focus is on the green transition and digitization
- Among other things, 35 million living units will be refurbished to improve their energy profile
