On November 26, Italy’s Ministry of Environment and Energy Security (MASE) published the National Hydrogen Strategy, aimed at promoting hydrogen production and consumption as a key energy vector in the country’s decarbonization efforts.

The strategy envisions investments ranging from €29 billion to €57 billion by 2050, positioning Italy as a leader in the energy transition.

Dr.Prof.    Gaetano Santonocito  CEO of IBC Energy, stated that the Italian green hydrogen market is expected to develop progressively over the coming years, driven by domestic production and ammonia imports. He highlighted Italy’s competitive advantages, including a robust industrial and manufacturing chain, key players in the supply chain, and a strategic geographical position.

However, Santonocito, pointed out significant barriers facing the sector, such as regulatory challenges, lack of infrastructure and gas networks, poor coordination, and high production costs.

“The primary barrier relates to the absence of a coordinated and coherent plan to develop the hydrogen value chain. This framework depends on decisions to be made at the European Union level, where Italian representatives participate to defend national positions,” he explained, adding that such participation has not always aligned with national interests.

Santonocito, also noted a lack of coordination among ministries, resulting in a “fragmented development” of the value chain, with missing elements across various projects, regulatory barriers, and authorization hurdles. He emphasized that high production costs require urgent support measures, such as incentives, and that key aspects like hydrogen logistics and vehicle acquisition (mainly buses and trucks) lack adequate support.

“One challenge is the high electricity costs in the country, which can be up to twice as much as in other European nations. This requires electricity market reform, expected to be addressed by the European Commission within the next two to three years,” he added in an interview with Energía Estratégica España.

National Strategy and Long-Term Development

Italy’s hydrogen strategy focuses on its use as an energy vector for decarbonization, particularly in heavy industries, long-distance transportation, aviation, and maritime sectors. The plan combines domestic production and imports, with significant investments in infrastructure and technology.

The strategy outlines three phases: pilot projects through 2030, market expansion from 2030 to 2040, and consolidation by 2050. In the final stage, hydrogen could account for 18% of industrial energy consumption and 30% of transportation energy. In the short term, the emphasis is on Hydrogen Valleys—local ecosystems integrating production and consumption in specific areas.

It is worth noting that the original goal of 5 GW of electrolyzers by the end of the decade has been adjusted to the current context. “Delays in developing the national strategic framework and global structural challenges have reduced this target to 1 GW,” the specialist explained.

The Italian government’s proposed measures include mandating green hydrogen use to drive demand, promoting domestic production, simplifying permits, and strengthening international partnerships.

“Incentives will enable the creation of the first production and usage hubs, particularly in major industrial sites. However, large-scale plants are not expected, with an ideal cap of up to 100 MW,” detailed Santonocito.

Regarding mobility, he added, “A network of infrastructure will be developed, supported by adequate tools and incentives, enabling the deployment of hydrogen-based heavy transport, likely starting in 2030 along major highway corridors, especially in northern Italy. The arrival of import infrastructure, gas networks, and port facilities will accelerate the hydrogen sector, but likely from 2035.”

Unlike other international strategies that often focus on domestic hydrogen production as a key element, Santonocito, indicated that Italy prioritizes “identifying off-takers and analyzing the conditions under which end-users would adopt hydrogen as a decarbonized energy vector.”

“Hydrogen production in Italy will balance between imports and domestic production, although it currently faces high costs and a significant gap compared to market-affordable prices for replacing fossil fuels. Initially, domestic production will be supported by incentives outlined in the forthcoming tariff decree,” he emphasized.

Southern Hydrogen Corridor

One of the key projects in Italy’s strategy is the “Southern Hydrogen Corridor.” This large-scale energy infrastructure initiative aims to transport renewable hydrogen from North Africa to central and southern Europe. The corridor, passing through Italy, Austria, and Germany, is considered strategic for supplying clean hydrogen to Europe, leveraging the competitive green hydrogen production potential in North African countries.

“It will enable hydrogen imports from North Africa, where production costs are estimated at €2-4/kg, thanks to local conditions. This scenario is complemented by relatively low marginal transportation costs,” Santonocito explained.

Transporting hydrogen to Sicily would involve an additional cost of approximately €0.6/kg, while delivering it to northern Italy would result in a total transport cost of €0.9/kg from North Africa.

“These total costs are significantly lower than those of local production in Italy, especially in areas with limited access to cost-effective renewable sources, such as the Po Valley,” he added.