Mind the Gap—A Socio-Economic Analysis on Price Developments of Green Hydrogen, Synthetic Fuels, and Conventional Energy Carriers in Germany

Christian Schnuelle, Timo Wassermann and Torben Stuehrmann
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Christian Schnuelle: Resilient Energy Systems Department, University of Bremen, Enrique-Schmidt Straße 7, 28359 Bremen, Germany
Timo Wassermann: Resilient Energy Systems Department, University of Bremen, Enrique-Schmidt Straße 7, 28359 Bremen, Germany
Torben Stuehrmann: Resilient Energy Systems Department, University of Bremen, Enrique-Schmidt Straße 7, 28359 Bremen, Germany

Energies, 2022, vol. 15, issue 10, 1-13

Abstract: In recent years, the development of energy prices in Germany has been frequently accompanied by criticism and warnings of socio-economic disruptions. Especially with respect to the electricity sector, the debate on increasing energy bills was strongly correlated with the energy system transition. However, whereas fossil fuels have rapidly increased in price recently, renewable substitutes such as green hydrogen and synthetic fuels also enter the markets at comparatively high prices. On the other hand, the present fossil fuel supply is still considered too low-priced by experts because societal greenhouse gas-induced environmental impact costs are not yet compensated. In this study, we investigate the development of the price gap between conventional energy carriers and their renewable substitutes until 2050 as well as a suitable benchmark price, incorporating the societal costs of specific energy carriers. The calculated benchmark prices for natural gas (6.3 ct kWh −1 ), petrol (9.9 ct kWh −1 ), and grey hydrogen from steam methane reformation (12 ct kWh −1 ) are nearly 300% above the actual prices for industry customers in 2020, but below the price peaks of early 2022. In addition, the price gap between conventional fuels and green hydrogen will be completely closed before 2050 for all investigated energy carriers. Furthermore, prognosed future price developments can be considered rather moderate compared to historic and especially to the recent price dynamics in real terms. A gradual implementation of green hydrogen and synthetic fuels next to increasing CO 2 prices, however, may temporarily lead to further increasing expenses for energy, but can achieve lower price levels comparable to those of 2020 in the long term.

Keywords: hydrogen; synthetic fuels; inflation; environmental impact costs (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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