Renewable hydrogen is emerging as a key element in Europe’s clean energy transition, offering solutions for hard-to-decarbonise sectors like industry (e. g. iron and steel, chemical, petrochemical) and transport (mostly long-haul aviation and shipping).
As hydrogen production, transport, storage, and use will significantly impact the power system, ENTSO-E and Europe’s transmission system operators (TSOs) are working to ensure its integration supports system security and flexibility. ENTSO-E`s report highlights how electrolysers and hydrogen infrastructure can contribute to a resilient, decarbonised energy system – and the coordinated actions needed to make that vision a reality.
This article highlights key messages from the ENTSO-E study on the integration of renewable hydrogen and electrolysers into Europe’s power system – outlining the actions needed for an efficient, flexible, and decarbonised energy future:
- Coordination between hydrogen and electricity systems is essential for a successful energy transition. Electrolysers and hydrogen facilities must be planned and operated in sync with the power system to maximise benefits for both sectors and consumers. This requires cross-sector planning, collaboration between operators, and a supportive regulatory framework to enable smart investments, avoid stranded assets, and protect system stability – particularly during the scale-up phase.
- Electrolyser investments and locations must align with power system needs to ensure efficient decarbonisation. Where and how electrolysers are sited – whether near renewable generation, consumption points, or both – and how they connect to the grid has a direct impact on electricity network capacity, development, and stability. Regulation and market design should incentivise technologies, locations, and operations that benefit both the hydrogen and power systems while supporting the phase-out of natural gas.
- Electrolysers and hydrogen infrastructure can provide valuable flexibility to the energy system. Electrolysers can offer short-duration flexibility through demand response, supporting grid balancing and congestion management. In the future, hydrogen transport and storage facilities could also deliver long-duration flexibility by enabling re-electrification during renewable scarcity. Such infrastructure can optimize the hydrogen sector by exploiting surplus cheap renewables, and build reserves for broader hydrogen applications beyond electricity.
- Renewable hydrogen can play a key role in ensuring resource adequacy in a carbon-neutral energy system. Power-to-hydrogen (P2H2) offers demand response potential, while hydrogen-to-power (H22P) can provide low-carbon backup capacity via repurposed gas turbines. Both applications can support national capacity mechanisms and strengthen energy security.
- Targeted and well-designed public support can be beneficial during the hydrogen ramp-up phase. Efficiently deployed support can stimulate green hydrogen production, drive demand, and encourage investments in transport and storage infrastructure – helping to build the full value chain and enhance energy system flexibility.
ENTSO-E`s report concludes that renewable hydrogen holds great promise for decarbonising Europe’s industry, transport, and e-fuels sectors by 2050. Yet, a clear gap remains between the EU’s ambitious targets and the current level of demand and domestic production capacity. Building a hydrogen economy will require close cooperation between network operators, regulators, and new hydrogen stakeholders, as well as early action on integration strategies and business models.
While renewable hydrogen is not yet cost-competitive compared to fossil-based alternatives, advances in technology, scaling effects, and rising CO₂ prices are expected to close this gap. To succeed, Europe must optimize electrolyser deployment, promote flexible operations, and ensure that regulation and market design incentivise solutions beneficial to both the hydrogen and power systems.
For the full analysis and recommendations, see the ENTSO-E study here (Executive Summary) and here (Detailed Report).
