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Europe’s Green Hydrogen Reality Check

  • Apr 15
  • 6 min read

Enerdealers Editorial




The launch of ERA comes at an important moment for Europe’s energy system. The EU has long positioned renewable and low-carbon hydrogen as a pillar of industrial decarbonisation, energy security, and competitiveness, but the delivery pipeline has advanced far more slowly than policy targets. ERA is designed as a CEO-led coalition of industrial players spanning production, infrastructure, and end use, with the explicit aim of moving from strategy to execution.


For energy decision makers, the significance is not the symbolism of another alliance. It is the signal that Europe’s hydrogen sector has entered a more pragmatic phase in which success will depend less on broad declarations and more on project economics, permitting speed, grid access, offtake contracts, and cross-border coordination.


Europe cannot build a competitive clean-hydrogen market if regulation remains fragmented, electricity costs stay high, demand remains uncertain, and infrastructure development remains too slow.


Why ERA matters


The European Resilience Alliance (ERA) is a response to a familiar European problem: policy ambition outpacing implementation. According to Hydrogen Europe, the alliance brings together companies across the clean-hydrogen value chain and has published a white paper calling for concrete policy action to close the gap between ambition and deployment. The founding members listed in the launch materials include ENAGÁS, FLUXYS, FORTUM, GASGRID FINLAND, MOEVE, NORDION ENERGI, OGE, RWE, SEFE, STEGRA, and THYSSENKRUPP, working with Hydrogen Europe.


The alliance’s message is straightforward: Europe cannot build a competitive clean-hydrogen market if regulation remains fragmented, electricity costs stay high, demand remains uncertain, and infrastructure development remains too slow. That diagnosis matters because hydrogen projects are capital intensive, long dated, and highly sensitive to policy risk, so the cost of delay quickly becomes a cost of capital problem.


The market gap


The clearest argument for ERA is the difference between what Europe has promised and what it has delivered. The EU Hydrogen Strategy set a target of 40 GW of renewable hydrogen electrolysers in the EU by 2030, alongside 10 million tonnes of renewable hydrogen production. Yet project progress has lagged badly, with industry reporting that only a small share of projects have reached final investment decision.


Hydrogen Europe has also highlighted that Europe remains far from the original 2024 milestone of 6 GW of electrolyser capacity, with only a fraction of that target achieved and a sizeable but still incomplete construction pipeline. That is the central tension ERA wants to address: a policy framework that is directionally strong, but still too complex and too uncertain to unlock large-scale private investment.





What the alliance wants


ERA frames its agenda around four pillars: industrial strength, energy sovereignty, security of supply, and decarbonisation. Those priorities are not abstract; they map directly onto the business case for hydrogen in Europe. Industrial strength means keeping manufacturing, engineering, and project development in Europe rather than losing them to better-supported markets elsewhere.


Energy sovereignty is equally important. Several alliance voices argue that clean hydrogen can reduce exposure to volatile imported fossil fuels and help Europe build a more resilient energy system. Security of supply matters because hydrogen is not just a decarbonisation tool; it is also a system-balancing and storage option that can support hard-to-electrify sectors and help integrate renewables.clean-hydrogen.


The policy bottlenecks


ERA’s white paper points to several specific barriers. The first is fragmented implementation of EU regulation, especially around renewable fuels of non-biological origin, or RFNBOs, which have become a source of complexity for developers and offtakers. The second is the electricity price problem, which hits electrolyser economics directly because power is the main operating cost.


A third bottleneck is demand certainty. Industrial customers may support the hydrogen transition in principle, but many are still reluctant to sign long-term contracts unless price, volume, and regulatory compliance are all clear. A fourth issue is infrastructure: without pipelines, storage, terminals, and import corridors, even competitive projects can remain stranded assets.


Hydrogen is not a fashionable optional extra; it is one of the few available decarbonisation pathways.


Infrastructure is decisive


This is where the debate becomes operational rather than ideological. Hydrogen markets do not scale simply because more electrolyser capacity is announced; they scale when production, transport, storage, and end use move together. The EU’s earlier hydrogen alliance was built around that logic too, with roundtables on production, transmission and distribution, and end use, and an investment pipeline that has been used to map more than 700 projects.


Recent EU funding decisions reinforce that infrastructure is now central to policy execution. In January 2026, the Commission awarded hundreds of millions of euros to cross-border electricity and hydrogen projects, including terminals and storage assets in Germany, the Netherlands, Spain, and elsewhere. That matters because the hydrogen economy will not be decided only by electrolysers; it will be decided by whether Europe can build a credible backbone that connects supply to demand at scale.


The industrial logic


The industrial case for hydrogen remains strongest in sectors that cannot easily electrify. EU policy documents and strategy papers continue to point to steel, refining, chemicals, heavy transport, and some maritime applications as key demand anchors. For those sectors, hydrogen is not a fashionable optional extra; it is one of the few available decarbonisation pathways.


That said, the market still needs a stronger pull from customers. The European Clean Hydrogen Alliance has spent years building a project pipeline and investment agenda, but the fact that many projects have not reached final investment decision shows how fragile the transition remains. ERA’s value proposition is that a more unified industrial coalition can reduce transaction costs, improve visibility for investors, and present policymakers with a clearer set of asks.


The investment problem


Hydrogen has always been as much a financing challenge as a technology challenge. Industry analysis in 2026 suggests that Europe is moving from ambition to delivery, but that growth remains concentrated in a relatively small number of large, government-backed projects. That is not surprising: early markets for strategic technologies often depend on public support before they become self-sustaining.


ERA is trying to accelerate that transition by improving bankability. Its white paper argues that fewer than 7 percent of projects in the broader clean-hydrogen pipeline have reached final investment decision, which suggests that Europe has a large project idea pool but a much smaller execution pool. For investors, that is a warning sign; for policymakers, it is a sign that support mechanisms need to be more targeted, simpler, and faster to deploy.


ERA’s core argument is that Europe now has enough strategy and not enough execution, and that the next phase must be built around delivery.


Europe’s competitive test


ERA also reflects a broader industrial competitiveness debate. The alliance’s supporters argue that Europe risks falling behind if it cannot turn its hydrogen leadership claims into real manufacturing and infrastructure capacity. That is especially relevant as global electrolyser manufacturing becomes more competitive and Europe faces pressure from lower-cost suppliers elsewhere.


The strategic issue is not just whether Europe can meet climate targets. It is whether it can keep a domestic industrial base in areas such as electrolyser manufacturing, pipeline engineering, compression, storage, and hydrogen-related systems integration. If Europe loses those capabilities, it risks importing the equipment and services needed for its own energy transition.


What decision makers should watch


For executives, developers, and policymakers, three indicators will matter most over the next 12 to 24 months. First, whether the EU and member states simplify RFNBO and related hydrogen rules enough to reduce compliance friction. Second, whether more long-term offtake agreements emerge from steel, chemicals, refining, shipping, and mobility players.


Third, whether infrastructure funding keeps pace with production ambitions. The hydrogen market will not become liquid because a coalition says it should; it will become liquid when pipelines, terminals, storage, and demand centres are actually connected and financed. ERA’s core argument is that Europe now has enough strategy and not enough execution, and that the next phase must be built around delivery.


Conclusion


ERA arrives at a time when Europe’s hydrogen sector needs discipline more than slogans. The alliance’s main contribution may be that it forces the discussion onto the hard questions: how to lower risk, align regulation, stimulate demand, and build the infrastructure that makes hydrogen usable in the real economy.


For the energy sector, the launch is a useful reminder that clean hydrogen will not advance through policy targets alone. It will advance when Europe creates a market structure in which private capital can earn a return, industrial users can trust supply, and infrastructure can scale quickly enough to matter. ERA is essentially an attempt to turn that formula into a coordinated industrial push.



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